IEEPA Tariff Refunds vs. the ERC: What Importers Should Learn From a Slower-Moving Refund Program
TL;DR
The Employee Retention Credit (ERC) was projected to process within weeks but took years for many claimants, with billions still unpaid. IEEPA tariff refunds share structural similarities: government-processed, high-volume claims subject to capacity constraints. Importers should learn from the ERC experience and pursue active claim management rather than filing and waiting.
What Was the ERC and What Happened?
The Employee Retention Credit (ERC) was a refundable tax credit introduced during the COVID-19 pandemic to encourage businesses to keep employees on payroll. Eligible employers could claim the credit by filing amended payroll tax returns with the IRS. When the program launched, processing was projected to take weeks. Instead, the IRS was overwhelmed by claim volume, fraud concerns, and capacity constraints. Processing timelines extended to 12, 18, and in many cases 36 or more months. The IRS imposed a moratorium on new ERC claims in September 2023 and as of mid-2025, billions in legitimate claims remain unprocessed.
How Are IEEPA Tariff Refunds Similar to the ERC?
While the ERC and IEEPA tariff refunds involve different agencies and different legal frameworks, they share important structural similarities. Both are government-processed refund programs with stated processing timelines that may not reflect reality. Both are subject to volume surges as awareness grows. Both involve bureaucratic capacity constraints that individual claimants cannot control. And both reward claimants who pursue active management over passive waiting.
What Should Importers Learn From the ERC Experience?
The ERC taught businesses three important lessons that apply directly to IEEPA tariff refunds: 1. **Stated timelines are guidance, not guarantees.** CBP's 60 to 90 day processing estimate is just that — an estimate. Importers should plan for longer timelines. 2. **Passive claims get deprioritized.** ERC claimants who filed and waited often saw their claims languish. Those with active representation and follow-up tended to resolve faster. 3. **Cash flow planning matters.** Businesses that treated the ERC refund as certain near-term income were caught off guard by delays. Importers should plan for IEEPA refund delays and consider advance funding to bridge the gap.
Why Active Claim Management Makes the Difference
Active claim management means more than filing a protest and waiting. It means monitoring claim status regularly, responding promptly to CBP requests, escalating stalled claims through proper channels, and maintaining audit-ready documentation throughout the process. For ERC claims, businesses that worked with experienced professionals who actively managed their claims saw resolution faster than those who filed independently and waited. The same principle applies to IEEPA tariff refunds — proactive management keeps claims moving through the system.
The Case for Advance Funding in a Slow-Moving System
The ERC experience demonstrated that government refund programs can take far longer than expected. For importers with significant IEEPA tariff overpayments, advance funding provides a practical solution to the timing uncertainty. Rather than waiting months — or potentially longer — for CBP to process the refund, qualifying importers can access capital against their filed claims and redeploy it immediately. This eliminates the opportunity cost of waiting and ensures that tariff overpayments do not constrain business operations.
| Factor | ERC (Employee Retention Credit) | IEEPA Tariff Refunds |
|---|---|---|
| Administering Agency | IRS | CBP |
| Original Processing Estimate | Weeks to months | 60–90 days (per CBP guidance) |
| Actual Processing Timeline | 12–36+ months for many claims | Frequently exceeding 90 days |
| Claim Volume | Millions of claims | Growing as awareness increases |
| Fraud/Error Concerns | High — led to moratorium | Lower, but compliance matters |
| Active Management Impact | Significant for resolution speed | Significant for resolution speed |
| Advance Funding Available | Yes (through third parties) | Yes (through TRA) |
Frequently Asked Questions
Are IEEPA tariff refunds at risk of a moratorium like the ERC?
As of mid-2025, there is no indication of a moratorium on IEEPA tariff protests. However, the ERC experience shows that high claim volumes can lead to policy changes. Filing promptly within the 180-day window is advisable.
Is the ERC comparison a scare tactic?
No. The comparison is factual — both programs share structural similarities as high-volume, government-processed refund systems. The purpose is to set realistic expectations and highlight why active management matters.
Were ERC delays caused by fraud?
Partly. The IRS identified widespread fraud and improper claims, which contributed to the moratorium and processing slowdowns. IEEPA tariff protests have a different risk profile, but the lesson about compliance-first filing remains relevant.
Chris Ward | Ward Business Solutions
Tariff Refund Agency is not CBP, U.S. Customs, or a government agency. We do not provide legal advice. Refund eligibility, amounts, and timing depend on individual circumstances. Past results do not guarantee future outcomes.