Duty recovery
How one wrong Section 232 heading cost $7,475 a container
A U.S. importer of steel auto parts from India paid the 50% metals duty on parts that owed 25%. The entries passed CBP's system without a question. This case study shows how the error happened, what the correct headings are, and how the overpaid duty comes back.
Who was the importer?
A U.S. importer of steel auto parts from India: exhaust hangers, pipe sections, machined housings and engine covers. It brings in about 100 ocean containers a month. Another customs broker files every entry.
Duty on its entries ran at 52.5 to 58.5 percent of the entered value. The importer thought that the cost came from tariff policy. It sent us its entry data for a second opinion.
What went wrong?
The broker put one Section 232 metals heading, 9903.82.02, on every line of every entry. That heading adds 50% of the value. But it covers only articles in chapters 72, 73, 74 and 76 of the tariff schedule (U.S. note 16(c)(i) to (v) to chapter 99).
Most of the importer's parts are in chapters 84 and 87. They are on the derivative lists in U.S. note 16(c)(vi) to (viii). Their heading is 9903.82.09, which adds 25%.
Take the exhaust hangers and brackets of HTS 8708.99.8180. The broker filed them under 9903.82.02 at +50%. The correct heading is 9903.82.09 at +25%. With the 2.5% base duty, the line paid 52.5% instead of 27.5%.
The audit found two more errors:
- A plastic fuel filler neck with steel at 9% of its weight. Outside chapters 72 to 76, the metals duty applies only when the metal is at least 15% of the weight. This part takes 9903.82.03 (no metals duty) and the Section 301 duty on goods of India (+10%).
- Cylinder head covers of HTS 8409.91.5085. They are not on the metals list at all. They pay only the base duty and the Section 301 duty on goods of India.
One line was correct. Hex bolts of HTS 7318.15.8069 are in chapter 73, so 9903.82.02 applies to them.
What did one container cost?
The table shows one representative container of the importer's goods, entry date August 20, 2026. The rates include the base duty.
| Article (HTS) | Value | As filed | Correct | Saved |
|---|---|---|---|---|
| Exhaust hangers and brackets (8708.99.8180) | $8,000 | 9903.82.02 at 52.5%: $4,200 | 9903.82.09 at 27.5%: $2,200 | $2,000 |
| Exhaust pipe sections (8708.92.7500) | $6,000 | 9903.82.02 at 52.5%: $3,150 | 9903.82.09 at 27.5%: $1,650 | $1,500 |
| Machined housings, cast steel (8487.90.0080) | $3,500 | 9903.82.02 at 53.9%: $1,887 | 9903.82.09 at 28.9%: $1,012 | $875 |
| Fuel filler necks, plastic, steel 9% of the weight (8708.99.8180) | $4,000 | 9903.82.02 at 52.5%: $2,100 | 9903.82.03 and 9903.05.44 at 12.5%: $500 | $1,600 |
| Cylinder head covers, not on the metals list (8409.91.5085) | $3,750 | 9903.82.02 at 52.5%: $1,969 | 9903.05.44 at 12.5%: $469 | $1,500 |
| Hex bolts, alloy steel, chapter 73 (7318.15.8069) | $5,000 | 9903.82.02 at 58.5%: $2,925 | 9903.82.02 at 58.5%: $2,925 | $0 |
| Total, one container | $30,250 | $16,230 | $8,755 | $7,475 |
At about 100 containers a month, the difference is about $747,500 a month. At the current volume, that is about $8.97 million a year. The merchandise processing fee and the harbor maintenance fee do not change.
How does an error like this happen?
The Section 232 metals rules changed on April 6, 2026. The duty moved to the full value of the goods, with new Chapter 99 headings. The rules changed again on June 8, 2026.
Many brokers file from product templates. A template stores the HTS number and the Chapter 99 headings for each part. After a rule change, the old heading stays in the template until someone corrects it.
CBP's system accepted every one of these entries. A valid Chapter 99 heading passes the ACE checks even when a lower heading applies. An entry that nobody corrects liquidates with the higher duty.
The cost also hides in the landed cost. Finance sees a margin problem, not a filing error.
How does the importer get the money back?
The route depends on the liquidation of each entry. Liquidation is CBP's final computation of the duty. CBP's liquidation cycle for an entry summary is about 314 days after entry.
| Entry status | Route | Deadline | Rule |
|---|---|---|---|
| Not liquidated | Post-summary correction (PSC) | Within 300 days of the date of entry and at least 15 days before the scheduled liquidation, whichever is earlier | 19 CFR 101.9(b) |
| Liquidated | Protest | Within 180 days after the date of liquidation | 19 U.S.C. 1514, 19 CFR 174.12 |
| Liquidated more than 180 days ago | None | The liquidation is final | 19 U.S.C. 1514(a) |
A PSC replaces the entry summary in ACE with the correct headings before liquidation. A protest asks CBP to change a liquidation that used the wrong duty. Each week, some entries pass one of these deadlines, so we sort the entries by date first.
The importer does not have to change brokers. With the same importer of record's authorization, CBP lets a filer submit a PSC on an entry that another filer submitted. The importer signs a power of attorney for Allied.
IEEPA duties follow a different route
CBP refunds IEEPA duties through CAPE declarations in the ACE Portal. It does not accept a PSC as an IEEPA refund request. After a CAPE declaration, ACE rejects a PSC on that entry. So we file any PSC first, then the CAPE declaration.
What changed for the importer?
The importer received the corrected headings for its new entries, line by line, with the legal basis for each. We checked its open entries for a PSC or a protest by entry date.
On a container like the one in the table, the duty falls from $16,230 to $8,755. The importer's broker can use the corrected headings, or Allied can file the entries.
How can I check my own entries?
Look at the Chapter 99 headings on your entry summaries. For each Section 232 metals line, ask three questions:
- Is the HTS number in chapter 72, 73, 74 or 76? Only then can 9903.82.02 (+50%) apply.
- Is the article a listed derivative outside those chapters? Then 9903.82.09 (+25%) or another derivative heading applies.
- Is the metal less than 15% of the article's weight? Then 9903.82.03 applies, with no metals duty.
ACE report ES-003 lists every entry line with its tariff numbers. Our free duty recovery audit re-rates each line with the rules in force on its date of entry.
Questions
Is the audit free?
Yes. The audit and the findings report are free. We quote any recovery filing after the audit, and you decide then. If you do not go ahead, you owe nothing.
Do I have to change customs brokers?
No. CBP lets a filer submit a post-summary correction on an entry that another filer submitted, when the same importer of record authorizes it. Your broker can keep filing your new entries.
How far back can I recover?
A PSC reaches entries that have not liquidated, up to 300 days after the date of entry. A protest reaches entries liquidated in the last 180 days. Older liquidations are final.
What if the audit shows that I paid too little?
We tell you the entries and the amount. A prior disclosure made before CBP starts a formal investigation limits the penalty under 19 U.S.C. 1592(c)(4). You decide if you file one.
What do you need from me?
The ACE report ES-003 Entry Summary Line Tariff Details for your importer of record number, or Cross Account Access to your ACE account. We also need a signed power of attorney.
Find out if your entries overpaid
Send us your ACE entry data. The audit and the findings report are free. You decide on any recovery filing after you see the numbers.