Billions in Tariffs Hang in Limbo While the Supreme Court Delays Its Ruling

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U.S. Customs and Border Protection has collected an estimated $195 billion in fiscal year 2025—a 150 percent increase over the prior year. Approximately $90 billion of that came from tariffs that courts have said are illegal. The United States Supreme Court heard arguments on November 5, 2025, about whether the president can impose tariffs on almost all imports without Congress. Three months later, as February 2026 begins, the justices have said nothing. No decision. No timeline. No indication they consider this particularly urgent.

Meanwhile, the federal government continues collecting roughly $20 billion to $30 billion monthly in tariffs that courts have said are illegal.

Since these tariffs took effect in January 2025, approximately $90 billion came from a law that allows presidents to impose tariffs when they declare an emergency—which the Supreme Court is now reviewing. Every day the justices delay, importers pay tariffs that courts say might be illegal. Every day, that money disappears into the government’s general money pot with no plan for what happens if the justices say it was collected without authority.

For thousands of businesses, this isn’t an abstract legal question. It’s whether the $100,000 they paid last month was a business expense or a loan to the government. Whether next year’s budget should assume these costs continue or vanish. Whether to restructure supply chains based on rates that might not survive the summer.

The Earliest Possible Date Is February 20. Maybe.

Nobody knows when the Supreme Court will decide, and the justices haven’t signaled they plan to tell anyone. The most optimistic timeline puts the decision no earlier than February 20, 2026—the next scheduled public bench session, though opinions are not guaranteed to be released on that specific date. That’s not because they’ll be ready, but because that’s the next day they’re scheduled to take the bench for a session where they don’t hear cases.

These sessions happen on Fridays when new lawyers are admitted to the bar. Opinions are released on these days because the justices rarely break their self-imposed schedule even for cases affecting hundreds of billions of dollars. If the opinion isn’t ready by February 20, the next opportunity comes whenever they next convene. Could be days. Could be weeks.

The alternative timeline stretches to June 2026, when the current term ends. Or beyond—into October 2026 when the next term begins, extending the uncertainty another four months minimum. The justices took eight months to decide a case about sex-offender registries. Six months for the decision overturning abortion rights. Seven months for the case restricting EPA authority. The TikTok case, decided in seven days, required an actual deadline set by law—the law specified an exact shutdown date that forced their hand.

No such deadline exists here. The tariffs can continue indefinitely. The justices can deliberate indefinitely.

Treasury Secretary Scott Bessent, when asked about timing, said he expects a “mishmash” ruling.

Why the Justices Won’t Rush

The Trump administration emphasized urgency in its briefings. Bessent warned that “the longer a final ruling is delayed, the greater the risk of economic disruption.” Yet despite this professed urgency, the administration scheduled oral arguments for the regular November session—nearly two months after review was granted—rather than requesting emergency consideration during recess.

Neither side filed a motion asking the court to decide faster after the November argument.

The justices view their own institutional functioning as more urgent than external economic pressure. They guard their docket and resist outside pressure to conform to external timelines, viewing such resistance as necessary to maintaining their independence. Economic consequences, however grave, don’t typically override this commitment. They have allowed uncertainty about what the rules actually are to persist for years when constitutional questions were genuinely difficult, operating on the theory that rushed decisions on constitutional matters risk making things worse instead of better.

During oral argument, justices grappled with intricate questions about whether the law allows this, whether the president has too much power, and whether this is too big a decision for the president alone. Different justices writing different opinions explaining their reasoning naturally extends the timeline. Writing and circulation can consume months even after a case is argued and voted upon, as justices negotiate language, respond to each other’s drafts, and seek to build coalitions.

One prominent trade law expert suggested during the post-argument period that “the court is more evenly divided than appeared to be the case at oral argument and the fifth vote is wavering.” If true, that would explain the delay. Justices disagreeing about which side should win can take months to resolve.

Whatever the reason, the practical effect is clear: the delay is now effectively making policy.

The Money Keeps Flowing Into a Black Box

When a company imports goods subject to these tariffs, U.S. Customs and Border Protection calculates and collects the tariffs at the rate specified in the president’s executive orders. The importer submits import paperwork, the amount is calculated, and the duty is either paid immediately or guaranteed by a financial bond. This money flows into federal accounts. From the government’s perspective, it’s revenue.

Except the legal authority for collection is contested. Lower courts ruled that the tariffs shouldn’t be collected, with decisions striking down the IEEPA tariffs. Only a temporary halt to that court order—granted to allow time for review—prevents the tariffs from ending immediately.

So what happens to all this money if the tariffs are invalidated?

Surprisingly little clarity exists on this point. The government hasn’t announced a separate account to hold the money. No instructions from the Treasury Department explain the contingency. No memo from Customs and Border Protection clarifies how the agency is treating these collections differently from ordinary revenue. In practice, the money appears to be treated as government revenue, counted in budget documents and Treasury statements, spent into the general revenues of the federal government.

If the tariffs are invalidated, this “revenue” will need to be refunded. That requires either Treasury to return money it has already spent—requiring Congress to approve new spending or shift money from other programs—or some other mechanism nobody has explained yet.

In 1998, the Supreme Court struck down the Harbor Maintenance Tax as applied to exports in United States v. United States Shoe Corp. Following that decision, the government issued refunds, but only to importers and exporters who had filed a complaint on time or who sued. The refunds came months or even years after the decision. Companies that hadn’t pursued a legal claim found themselves without recourse despite the tax being unconstitutional. The process was not automatic. Many affected parties missed the opportunity for recovery entirely.

The Insurance Policy: Filing Lawsuits to Preserve Rights

This precedent has prompted hundreds of importers to take preemptive action. As of late 2025, over 1,000 companies representing 900-plus lawsuits had filed lawsuits to protect their right to get refunds pending the decision.

These lawsuits serve as insurance policies. Under customs law, when the tariff calculation is finalized—the process where Customs finalizes how much tariff was owed and sends the money to the Treasury—the decision becomes final unless the importer files a complaint within 180 days of the tariff being finalized. Miss this deadline, and you generally have no legal recourse, even if a later ruling invalidates the tariff.

The earliest tariffs took effect in January 2025, meaning the government finalized the calculations on goods from that period in the months following, creating deadlines for importers to file protests within 180 days of each individual tariff determination. The Supreme Court decision is expected by late June or early July 2026, but importers cannot wait for that decision without risking the loss of their right to challenge individual tariff determinations that are being finalized on a rolling basis.

The companies filing lawsuits—including Costco, Kawasaki Motors, Revlon, Bumble Bee Foods, and TOMS Shoes—recognized that filing complaints with the government might not be enough. Because CBP simply followed orders without making judgment calls, legal experts debated whether companies could formally challenge these tariffs through normal procedures.

Filing a lawsuit in the Court of International Trade provides an independent legal basis to challenge the authority itself, without relying on whether CBP’s actions could be formally challenged. This two-part strategy—litigation to preserve refund rights, combined with administrative protests as a backup—has become standard practice among sophisticated importers.

The legal fees for Court of International Trade litigation run tens of thousands of dollars per case, multiplied across hundreds or thousands of entries. Customs brokers charge fees for filing paperwork, requesting delays, and managing cases. The total cost to all the companies importing goods for preserving refund rights amounts to tens of millions of dollars in legal and professional services—costs borne entirely because of legal uncertainty, costs that would be unnecessary if the decision had been expedited or if the lower courts’ injunctions remained in effect.

How Refunds Would Work (If They Happen at All)

If the tariffs are invalidated, the most direct approach would be for CBP to recalculate tariffs on affected goods at the legal rate (usually zero) and issue refunds through its normal payment process.

Under federal customs law, refunds include interest calculated from when the company overpaid, using interest rates the government pays when it owes you money. These interest rates currently exceed more than 8 percent per year. A $100,000 tariff paid in February 2025 and refunded in February 2026 would include more than $8,000 in accrued interest, making the refund process more expensive for the government but also more valuable to importers.

Yet the timeline for such refunds, how to process refunds for hundreds of thousands of shipments, and whether Congress might need to approve money for the refunds remain unsettled.

An alternative mechanism would involve a legislative appropriation specifically authorizing refunds. Congress would need to pass a bill directing the Treasury to return unlawfully collected duties. Congress would argue about how much to refund and when. The United States Shoe precedent suggests that even when the law is clear, refunds don’t flow automatically but rather require processing claims, making decisions, and sometimes lawsuits to enforce their rights.

The prospect of administering refunds on potentially hundreds of billions of dollars worth of entries—with interest calculations, claims processing, and dispute resolution—presents huge practical problems that no one appears to be actively planning for at this moment.

What This Looks Like for Companies

Stellantis, an automaker with operations in Europe and America, estimated that the Trump administration’s tariffs in the first half of 2025 cost the company approximately 300 million euros (roughly $354 million) and projected full-year costs of 1.5 billion euros, which is about 27% of their annual profit. Ford reported costs of $200 million in the first quarter of 2025 and projected annual costs of $1.5 billion.

The cash flow impact for large importers is substantial. An importer with a customs broker relationship might pay $20 million or more monthly in tariffs, every month, without knowing whether the money is deductible as a cost of goods or whether it represents a refund asset awaiting recovery. This affects managing their day-to-day cash flow, borrowing needs, and the company’s ability to invest in growth or shareholder returns.

Some companies have negotiated purchase commitments with suppliers based on pricing that includes the tariff costs, which would become uneconomical if tariffs disappear, creating inventory management challenges. Others have brought goods into the country early—to beat increases—finding themselves with excess inventory if tariffs are invalidated.

One particularly acute problem affects importers near the deadline when the tariff calculation is finalized. Goods that enter in February 2025 and liquidate in December 2025 (the standard time it takes to finalize calculations, about 10 months) give the importer until approximately June 2026 to file a protest—a deadline that will fall before or contemporaneously with the likely decision. If the tariffs are invalidated in June or later, importers who didn’t file protective litigation in advance may find the deadline to file a complaint has passed, leaving them with no way to get their money back even though the tariff was illegal.

Trading Partners Are Making Their Own Bets

The legal uncertainty doesn’t remain confined to U.S. borders. China, Canada, Brazil, Vietnam, and the European Union have all taken steps in response to the tariffs, some filing complaints with the World Trade Organization and others opening trade negotiations seeking relief.

The World Trade Organization’s dispute process typically takes a year or longer, but several trading partners have reported positive progress in direct negotiations, suggesting they prefer bilateral deals to litigation. China and the United States reduced mutual tariffs through negotiation. Brazil entered discussions. Yet all these negotiations occur under a shadow of legal uncertainty: if the tariffs are invalidated, the negotiating dynamics shift fundamentally.

Trading partners face their own strategic questions. Should they maintain retaliatory tariffs against U.S. goods pending the decision, or should they suspend retaliation in hopes of negotiating settlements? Several major U.S. trading partners have positioned themselves to negotiate rather than escalate, filing WTO complaints to pressure the U.S. into negotiations rather than as a serious pursuit of formal legal proceedings.

The delay also affects developing countries and smaller trading partners without the negotiating power of China or the European Union. Countries like Vietnam and Cambodia, which have become important sources of imports to the United States as businesses shift sourcing away from higher-tariff countries, face uncertainty about whether the preferential treatment they might negotiate will be negotiating with authority that might soon be invalidated.

The Institutional Choice Behind the Delay

The decision to use the normal timeline shows something about how the institution weighs competing values. The justices don’t think economic pressure should rush their decision-making.

Trillions of dollars in potential federal revenue at stake, billions in monthly private payments that may need reversal, and cascading uncertainty for thousands of businesses do not constitute an emergency by these standards. This approach differs from how other government agencies respond, which often declare emergencies and act quickly.

The justices have long maintained that rushing big constitutional decisions can cause worse problems than waiting. A wrong constitutional decision stays in effect until the Court reverses it, which can take decades or never happen. Better to wait months for careful deliberation than to issue a hasty ruling that binds future generations.

In cases like Bush v. Gore, where a genuine emergency existed—a constitutional crisis about whether the president was legitimately elected, with a deadline they couldn’t change—the justices acted with extraordinary speed, hearing arguments on Monday and deciding by Tuesday. But absent such extraordinary circumstances, they proceed according to their usual pace.

A 2022 Supreme Court case about environmental rules for power plants, decided in June 2022 after argument in October 2021, addressed millions of consumers and vast economic resources, yet took eight months from argument to decision. No calls for expedited treatment were heard despite the economic consequences of uncertainty about what the rules actually are.

The tariff case fits this pattern: major constitutional questions get decided on the Court’s schedule, not on anyone else’s.

The Human Cost of Uncertainty

Behind the billions in revenue and the complex legal procedures lie real people making real economic decisions without adequate information.

A small importer that depends on suppliers in Asia faces decisions about whether to diversify sourcing or deepen relationships—decisions that commit them to costs for years. A customs broker must advise clients on whether to pay tariffs under protest, ask for more time before the tariff calculation is finalized, or file litigation, each choice carrying costs and risks. A procurement officer at a mid-sized company must build next year’s budget not knowing whether costs will be 10 percent of component sourcing or zero.

A manufacturing plant manager must decide whether to continue U.S.-based assembly or relocate to a tariff-advantaged country, and this decision affects workforce planning years in advance.

For thousands of small and medium-sized importers, the uncertainty makes business planning nearly impossible. Many companies have entered 2026 budget cycles without knowing whether the tariffs they paid in 2025 constitute business expenses or money they might get back. This makes it hard to prepare accurate financial reports, figure out taxes, and borrow money, and affects their ability to plan expansions or contractions in specific sourcing arrangements.

A company importing auto parts from Mexico faces tariffs that may or may not be legal, may or may not need refunding, and must decide whether to continue these import streams or shift to domestic sourcing or other countries. This decision has labor consequences, affects ability to keep getting supplies if something goes wrong, and influences where to invest money.

What Happens After the Decision

When the decision finally comes—whether in February or later—it will resolve the constitutional question but not the practical consequences of the long wait.

Getting refunds will take months or years. In 1998, the Supreme Court ruled that a tax on exports was illegal, yet it took years to figure out who could get refunds, in what amounts, and under what procedures. The government first refunded only the people who sued, then expanded it, but the process was neither automatic nor instantaneous.

If the current case results in a similar refund process, the decision would be the start of a long process of handling claims and disputes rather than the end.

Businesses will need to reverse decisions they made based on tariff uncertainty—decisions that can’t be reversed immediately. Trading partners will adjust their plans depending on whether tariffs stay or go. Supply chains changed by tariffs won’t return to how they were before even if the tariffs themselves disappear.

One analysis suggests that the government might use different laws to impose tariffs even if the authority is invalidated, using different laws like a law that lets the president impose tariffs on steel and aluminum if he says it’s for national security and a law that lets the president impose tariffs if other countries are trading unfairly. If this analysis is correct, even if the court rules the tariffs illegal, they might not disappear but the government might impose tariffs using different laws that might pass the Supreme Court’s review.

For now, billions hang in limbo. Collected by a government that might not have the legal right to collect it. Awaited by businesses that might not be able to get it back. Pending a decision that could come anytime.

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