Duty drawback: how it works and how to file a claim

What is duty drawback, and which payments can you get back?

Drawback returns duties that were paid when goods entered the United States for consumption, if the goods (or articles made from them) leave the country or are destroyed. Under 19 CFR 190.3, drawback is allowed on:

• Ordinary customs duties, including duties in Chapter 99 of the HTSUS where CBP allows drawback (see below).
• Marking duties under 19 U.S.C. 1304(c).
• Internal revenue taxes that attach on importation, such as federal excise tax.
• The merchandise processing fee and the harbor maintenance tax.

Drawback is not allowed on antidumping and countervailing duties (19 CFR 190.3(b)). Agricultural goods that paid the over-quota rate of a tariff-rate quota qualify only under unused merchandise drawback (and tobacco also under direct identification manufacturing drawback).

What are the types of duty drawback?

The drawback law has several provisions. Five of them cover most claims. Other provisions cover, for example, petroleum derivatives, ship supplies and goods exported to Canada or Mexico under USMCA.

Manufacturing drawback

Manufacturing drawback applies when imported goods (or, under substitution, goods of the same 8-digit subheading) are used to make an article in the United States, and the article is exported or destroyed without use. The manufacturer must operate under a drawback ruling: a letter of notification under a published general manufacturing drawback ruling (19 CFR 190.7), or a specific manufacturing drawback ruling (19 CFR 190.8). You can file claims before CBP acknowledges or approves the ruling, but CBP pays nothing until it does.

Unused merchandise drawback

Unused merchandise drawback applies when imported goods are exported or destroyed without use in the United States. Operations that do not amount to manufacture, such as testing, cleaning, repacking or relabeling, are not a use (19 U.S.C. 1313(j)(3)). Under substitution, the claimant must possess the substituted goods before the export, and the substituted goods must also be unused.

Rejected merchandise drawback

Rejected merchandise drawback applies when the imported goods do not conform to sample or specifications, were defective at the time of import, or were shipped without the consent of the consignee. The goods must be exported or destroyed under CBP supervision within 5 years after import. If the claimant is not the importer, every earlier owner (except the final buyer) must sign a statement that no one else claimed drawback on the goods (19 CFR 190.42).

How much drawback can you recover?

The general rule is 99% of the duties, taxes and fees that are eligible. The regulation gives this example: if $1,000 in duties is eligible, the claim is for $990 (19 CFR 190.51(b)). CBP does not pay a claim above 99% until the claimant corrects it, and pays a claim below 99% as filed.

Substitution claims have two extra limits. First, the refund per unit is the average for the entry line (per-unit averaging). Second, the refund cannot exceed 99% of the lesser of the duties paid on the imported goods or the duties that would apply to the exported or substituted goods if they were imported (19 CFR 190.22(a)(1)(ii) and 190.32(b)). When the exported goods have a lower value, the refund is lower.

What is the time limit for a drawback claim?

• Filing: a complete claim must be filed within 5 years after the date of importation of the merchandise that it designates. Claims not completed in that time are abandoned (19 CFR 190.51(e)).
• Export or destruction: it must also happen within 5 years after importation, and before the claim is filed (19 CFR 190.31 and 190.32).
• Manufacturing: the designated goods must be used in manufacture within 5 years after importation, and the article must be exported or destroyed within that period (19 CFR 190.27).
• Returned retail goods: the claim must designate an import entry from within 1 year before the export or destruction (19 CFR 190.45).
• Notice: CBP Form 7553 at least 5 working days before export for unused and rejected merchandise, and at least 7 working days before any destruction (19 CFR 190.35, 190.42 and 190.71).

How do you file a duty drawback claim?

1. Choose the provision: match each export or destruction to a drawback type, and check the 5-year limits.
2. For manufacturing drawback, file the letter of notification or the ruling application with CBP.
3. Before each export of unused or rejected goods, file CBP Form 7553, unless you hold a waiver of prior notice. CBP decides within 2 working days if it will examine the goods.
4. Export the goods and keep proof of export: the date, exporter, description, quantity, Schedule B or HTSUS number and country of destination (19 CFR 190.72).
5. Transmit the drawback entry in ACE through ABI. It lists each designated import entry line (10-digit HTSUS number, duties paid, value, quantity), the export data, the refund claimed and the required certifications.
6. Upload the required documents within 24 hours after the claim is filed. The claim is complete only when CBP has the documents.
7. Answer questions from the drawback specialist. CBP then liquidates the claim and pays the refund, unless it paid earlier under accelerated payment.

Most claimants use a licensed customs broker, because the claim is an ABI transmission. Since April 22, 2026, ACE routes all drawback claims to the Petroleum, Natural Gas and Minerals Center, which assigns them to a drawback specialist team by the first character of the importer of record.

What are accelerated payment and waiver of prior notice?

Accelerated payment means that CBP pays estimated drawback before it liquidates the drawback entry (19 CFR 190.92). The claimant applies in writing to the drawback office. The application describes the drawback program, the records and the bond. The claimant must give a bond that covers the estimated drawback. If open accelerated claims exceed the bond, CBP asks for more bond coverage first. Since June 16, 2026, bond errors in ACE (inactive bond, invalid surety code, insufficient bond and others) are fatal and remove accelerated payment from the claim.

Waiver of prior notice (19 CFR 190.91) removes the CBP Form 7553 notice for unused and rejected merchandise exports. CBP approves it on a written application. If you exported without a notice and without a waiver, 19 CFR 190.36 lets you apply for a one-time waiver, under conditions.

What records must a drawback claimant keep?

Keep all records that support a drawback claim for 3 years after liquidation of the claim, or longer if another law requires it (19 CFR 190.15). The records include import entries and invoices, export documents, inventory records, and, for manufacturing claims, production records and bills of materials. When imported goods are mixed in inventory with other goods, you must use an approved accounting method to identify them (19 CFR 190.14).

Can you get drawback on Section 232, Section 301 and IEEPA duties?

Each trade action decides if its duties qualify for drawback. On the claim, the filer must report the Chapter 99 number and the Chapter 1 to 97 HTSUS number for each line, in the order used on the import entry. The table shows what CBP has published.

For substitution claims, Section 301 duties are refundable, but the lesser-of rule can limit the amount when the substituted goods have a lower value. Read the Section 301 guide and the Section 232 page for the current rates.

Can e-commerce sellers claim drawback on returns?

Yes. Rejected merchandise drawback covers goods sold at retail and returned to the importer, or to the person who received the goods from the importer, for any reason (19 CFR 190.41 and 190.45). If the returned goods are exported or destroyed under CBP supervision, the seller can claim 99% of the duties paid.

The seller does not have to trace each returned item to its own entry. The claim can designate an entry imported within 1 year before the export or destruction, if the designated goods and the returned goods have the same 8-digit HTSUS subheading and the same part number, SKU or product code. CBP denies the claim if the seller cannot support that certification with records. Unsold stock exported without use can qualify as unused merchandise drawback.

Since de minimis treatment is suspended for all countries, more e-commerce imports pay duty on entry. See our e-commerce customs page for entry options.