The rules changed overnight. If you’re importing goods into the U.S., what worked last week won’t work today. Starting February 24, 2026, a 15% global import surcharge kicked in under Section 122 of the Trade Act of 1974, and the long-relied-upon de minimis exemption is gone for good. This combination will hit your margins, your pricing strategy, and your entire fulfillment model.

Here’s what happened: the Supreme Court struck down the IEEPA-based tariffs that had been the backbone of U.S. trade policy through 2025. The administration responded within hours by switching legal authorities and slapping a 15% duty on imports from virtually every country. The $800 duty-free threshold? Also dead, reaffirmed gone in the same executive order.

Whether you’re running a Shopify store, an Amazon FBA operation, or a dropshipping business built on cheap international goods, you need to understand exactly what changed, how the math works now, and what options you have to protect your business.

Jump right in: U.S. Tariffs Overhauled February 2026

• The Supreme Court Ruling That Triggered Everything
• Section 122: How the New 15% Surcharge Works
• The End of De Minimis: No More $800 Free Pass
• Customs Entry Types You Now Need to Know
• International Postal Shipments and the Qualified Party System
• New HTS Codes and CBP Technical Requirements
• How to Calculate Your True Landed Cost in 2026
• How Amazon and Shopify Are Responding
• FedEx and UPS Rate Hikes: The Hidden Cost Stack
• FTZs and Bonded Warehouses: Your Duty Deferral Options
• Duty Drawback: Getting Money Back on Re-Exports
• Recovering IEEPA Duties: The $175 Billion Refund Window
• What Happens When Section 122 Expires on July 24, 2026
• FAQ: Quick Answers for Ecommerce Sellers

Why IEEPA Tariffs Were Struck Down: The February 2026 Supreme Court Ruling Explained

On February 20, 2026, the Supreme Court handed down a 6-3 decision in the consolidated cases of Learning Resources, Inc. v. Trump and Trump v. V.O.S. Selections, Inc. The ruling was direct: the International Emergency Economic Powers Act (IEEPA) does not give the President authority to impose broad-based tariffs. Taxing imports is an Article I power. That belongs to Congress, not the executive branch.

With that ruling, the entire structure of tariffs that had been in place through 2025 and into early 2026 collapsed. The “reciprocal” duties and “fentanyl” tariffs built under IEEPA were suddenly illegal.

The administration’s response was fast. Within hours of the ruling, a new proclamation appeared invoking Section 122 of the Trade Act of 1974. An initial rate of 10% was announced, then the President posted on social media on February 21 raising it to 15%: the statutory maximum under Section 122. The framing was deliberate: unlike IEEPA, Section 122 is a statute specifically designed for trade-deficit situations, meaning it rests on much firmer legal ground.

The effective average U.S. tariff rate, which briefly dropped to 9.1% right after the SCOTUS ruling, is now sitting at approximately 13.7% under the 15% Section 122 regime.

Section 122: How the New 15% Surcharge Works

Section 122 of the Trade Act of 1974 is an obscure authority that had never been used in modern trade history before this month. It lets the President impose import surcharges when there’s a “large and serious” balance-of-payments deficit or when the U.S. dollar faces a significant risk of depreciation.

The administration’s justification: a $1.2 trillion goods trade deficit and a net international investment position at negative 90% of U.S. GDP.

Here’s the key difference from what came before:

The 150-day cap is the most strategically important detail here. Unless Congress acts to extend it, the 15% surcharge expires on July 24, 2026. That creates a real pricing question for sellers: raise prices now and risk losing customers if the duties disappear in July, or absorb the cost and hope the calendar works in your favor?

There’s no clean answer. But understanding the expiration date should be central to any decision you make about pricing or inventory in the next few months.

What’s Exempt from the 15% Surcharge?

Not everything gets hit. The following categories are carved out:

• USMCA-qualifying goods from Canada and Mexico (though de minimis filing is still required)
• Pharmaceuticals and medical components
• Critical minerals and strategic ores
• Select information materials and electronics
• Goods already subject to Section 232 duties (steel, aluminum, copper, certain autos)

That last point matters. The Section 122 surcharge does not stack on top of Section 232 duties. For products where Section 232 only applies to a portion of the value (like aluminum-intensive electronics), the 15% surcharge applies only to the non-subject portion.

Section 301 duties targeting China, however, can stack. A Chinese-made textile with a 12% base duty, 25% Section 301 duty, and now a 15% Section 122 surcharge can push the total effective rate above 50%.

The End of De Minimis: No More $800 Free Pass

The de minimis exemption let shipments valued under $800 enter the U.S. without duties or formal customs processing. It was the engine behind low-cost DTC shipping from overseas suppliers, the economic backbone of countless dropshipping businesses, and a massive advantage for platforms like Temu and Shein.

It’s over.

The suspension was originally implemented in August 2025 and was reaffirmed in the February 20, 2026 executive order. It now applies to all commercial imports, regardless of value or country of origin, with no defined end date.

A $15 item shipped from a supplier in China no longer gets waved through. It needs a full customs entry, HTS classification, and duty payment. The fixed costs of clearing that shipment (brokerage fees, bond premiums, filing fees) can easily exceed the value of the product itself.

For dropshipping models built on sub-$50 goods shipped directly from overseas, the math often doesn’t work anymore.

The model that does work: import your inventory in bulk to a U.S.-based 3PL like eFulfillment Service, clear customs once on the full shipment, and fulfill domestically from there. You pay duties once on the bulk import instead of navigating per-parcel entry costs on every single order.

Customs Entry Types After De Minimis: Type 11, Type 01, and Why Type 86 Is Gone

The end of de minimis also ends the easy path through customs. Every shipment now needs a formal entry type, and the right one depends on shipment value and product category.

Entry Type 86 (Abandoned) The automated Entry Type 86, widely used for low-value ecommerce, is no longer available for shipments subject to the new Section 122 surcharge. It’s gone.

Informal Entry (Type 11) For shipments under $2,500. This is the primary path for most ecommerce parcels now. It’s less paperwork than a formal entry, but it still requires:

• Accurate 10-digit HTS classification
• Proper valuation documentation

Formal Entry (Type 01) Required for shipments over $2,500 or products under specific regulatory oversight (FDA-regulated cosmetics, EPA-regulated electronics, etc.). Formal entries require a continuous or single-transaction customs bond.

Licensed customs brokers are now processing millions of small parcels that previously bypassed customs entirely. Per-unit costs, when you add brokerage fees, bond premiums, and the 15% duty, can be double what sellers were paying before.

One way to sidestep that per-parcel cost problem is to shift to a domestic fulfillment model. Working with a U.S.-based 3PL like eFulfillment Service means your goods clear customs at the bulk shipment level, and every customer order ships domestically from there, with no individual parcel entry required.

How International Postal Shipments Are Taxed Under the New 2026 Import Rules

Shipments moving through the international postal network used to get treated differently. Not anymore.

Under the new executive order, postal shipments face the same 15% Section 122 surcharge rate as everything else. To handle the volume, CBP created a “Qualified Party” process: transportation carriers and approved third parties are now authorized to collect and remit duties directly to the government.

In practice, this turns DHL, FedEx, UPS, and other international couriers into tax collection agents. Expect those carriers to pass the administrative burden back to you through added surcharges on international shipments. This system is described as temporary, a bridge until CBP establishes a permanent postal entry process, but there’s no defined timeline for that.

New HTS Codes and CBP Technical Requirements

As of February 23, 2026, CBP began deactivating all IEEPA-related tariff codes in the Automated Commercial Environment (ACE). Starting at 12:01 a.m. on February 24, every entry must use the new Section 122 subheadings under HTSUS Chapter 99 or risk automated rejection.

Here are the new codes you need:

If your products fall under an exempt category, you must verify your 10-digit HTS code against the Annexes in the February 20, 2026 proclamation and enter the correct Chapter 99 exemption code on your customs entry.

The “In Transit” Exception: A Tight Window

Goods already on the water have a narrow reprieve. The 15% surcharge is waived only if:

• Goods were loaded onto the vessel or aircraft before 12:01 a.m. on February 24
• AND the goods are entered for consumption before 12:01 a.m. on February 28, 2026

That’s a four-day window. If your shipment arrives after February 28, the 15% applies regardless of when it was loaded. Expedite those customs filings now.

How to Calculate Your True Landed Cost in 2026

The 15% surcharge compounds existing costs. Here’s the full formula your unit economics need to account for:

Landed Cost = Customs Value × (1 + Base HTS Duty Rate + 15% Section 122 + Section 301 Duty) + Brokerage Fee + Bond Cost + Merchandise Processing Fee + Harbor Maintenance Fee

Where:

• Customs Value = product cost + freight + insurance
• Base HTS Duty Rate = your product’s standard rate
• Section 301 Duty = applies primarily to Chinese goods
• Brokerage Fee = now mandatory for former de minimis shipments
• Bond Cost = pro-rated customs bond premium
• Merchandise Processing Fee (MPF) = 0.3464% of value (subject to minimums)
• Harbor Maintenance Fee (HMF) = 0.125% for ocean freight

For a $15 product, the fixed costs of brokerage and bond alone can exceed the product value. Low-cost direct-from-supplier models that relied on de minimis to stay viable are now functionally broken at the unit level.

A Real-World Example: Chinese Textile Seller

That’s before you add shipping to the customer, returns, and platform fees.

How Amazon and Shopify Are Responding

Amazon: Squeezing Suppliers and Tightening Policies

Amazon CEO Andy Jassy has acknowledged publicly that tariff costs are creeping into prices. The inventory pre-buying surge that sellers executed in early 2025 to get ahead of tariffs has run its course, and sellers are now facing the full cost exposure.

Amazon’s moves so far:

• Demanding 20-30% supplier discounts to offset the 15% tariff burden on its direct sourcing relationships
• Prepaid Return Label mandate (effective February 8, 2026): All U.S. sellers must now use Amazon’s Prepaid Return Label program. This matters because duties on imported items are non-refundable even when the item is returned. “Free returns” on international goods just became a real financial exposure.
• If you’re importing goods that carry a meaningful duty, a U.S.-based 3PL like eFulfillment Service can handle returns processing domestically, which at least removes the double-duty exposure from your returns equation.
• Tightened On-Time Delivery Rate (OTDR) enforcement: Sellers trying to save money by using slower international shipping methods to offset tariff costs will find themselves penalized on their metrics.

Shopify: AI as a Compliance Tool

Shopify’s 2026 winter release focused heavily on “Agentic Commerce,” a suite of over 150 updates using AI agents to automate HTS classification and show accurate landed costs at checkout. For smaller merchants without a trade compliance team.

The fact that a major ecommerce platform is building AI-driven customs compliance into its core product tells you how seriously the industry is taking this shift.

FedEx and UPS Rate Hikes: The Hidden Cost Stack

The tariff situation is landing on top of carrier rate increases that were already painful. Both FedEx and UPS announced a 5.9% General Rate Increase (GRI) for 2026. Independent audits suggest the real impact for ecommerce brands will land between 8% and 12% when you account for surcharge expansion.

Here’s what the surcharge increases actually look like:

One change that’s flying under the radar: both carriers added a cubic volume criterion to the Additional Handling surcharge. Any package exceeding 10,368 cubic inches now triggers the surcharge regardless of weight or length. If you sell pillows, small appliances, boxed apparel, or anything lightweight-but-bulky, check your package dimensions now.

FTZs and Bonded Warehouses: Your Duty Deferral Options

Two established customs tools are getting a lot more attention right now: Foreign Trade Zones and bonded warehouses. They work differently and serve different strategies.

Bonded Warehouses: Best If You Think Duties Will Drop

Goods stored in a bonded warehouse are assessed duties at the rate in effect at the time of withdrawal, not at the time of import. If the Section 122 surcharge expires on July 24, 2026 as scheduled, goods withdrawn from a bonded warehouse in August would pay 0% Section 122 duty.

This is the play for sellers who believe the July expiration will stick and duties will fall. It’s a bet on the legislative calendar.

Foreign Trade Zones: Best for High-Volume Sellers

FTZs offer more flexibility:

• Inverted tariff benefits: Import raw materials or components into a zone and manufacture finished goods that may carry a lower duty rate than the inputs themselves.
• Weekly entry consolidation: Instead of filing a customs entry for every individual parcel, FTZ operators can file a single weekly entry covering thousands of shipments. That saves significant money in Merchandise Processing Fees (MPF) annually. For high-volume sellers, this alone can justify the FTZ setup cost.
• Indefinite storage without a duty clock ticking.

Duty Drawback: Getting Money Back on Re-Exports

If you’re selling internationally, meaning you’re importing goods into the U.S. and then shipping some to customers in Canada, the UK, or elsewhere, you can recover up to 99% of the duties paid on those re-exported goods through the Duty Drawback program.

With a 15% surcharge now layered on top of existing duties, this program carries significantly more financial value than it did a year ago. For omnichannel brands with meaningful international sales, a formal drawback program isn’t optional anymore. The cash flow impact is too large to leave on the table.

Talk to a licensed customs broker about setting up a proper drawback claim process if you don’t already have one.

Recovering IEEPA Duties: The $175 Billion Refund Window

The Supreme Court ruling created something unexpected: a potential refund pool of $175-180 billion in duties paid under the now-illegal IEEPA orders. If your business paid IEEPA-based tariffs, you may have money coming back.

The catch: refunds aren’t automatic. You have to file for them.

How to File for a Refund

1. Administrative Protests (Form 19) You have 180 days from the liquidation date of each entry to file a protest challenging the duty collected. This is your primary mechanism for entries that have already been liquidated.
2. Post-Summary Corrections (PSC) For entries that have been filed but not yet liquidated (typically within 314 days of entry), file a PSC to remove the IEEPA tariff codes and request a refund of the overpayment.
3. ACE Portal Configuration All refunds now go through the Automated Clearing House (ACH) electronically. Make sure your ACE account is set up to receive electronic payments from CBP, or you’ll miss the refund even if your protest is approved.

Important: Only IEEPA-based duties are refundable under the Learning Resources ruling. Section 232 and Section 301 duties are not affected by the court’s decision. Don’t confuse them when filing.

What Happens When Section 122 Expires on July 24, 2026

The 150-day clock started February 24. That puts the expiration at July 24, 2026. What happens then is genuinely uncertain, and there are two realistic scenarios worth planning for.

Scenario 1: Congressional Extension Congress votes to extend the 15% surcharge, likely as part of a broader trade package that might include domestic manufacturing incentives. If this happens, the 15% becomes the new normal indefinitely.

Scenario 2: The Statutory Reset The administration declares a “new” balance-of-payments emergency and restarts the 150-day clock. This effectively creates a permanent tariff instrument without requiring a Congressional vote, just repeated 150-day intervals.

A third possibility: the surcharge genuinely sunsets and duties fall back to MFN rates. That outcome would benefit sellers who held goods in bonded warehouses. But it’s the least certain of the three.

Build your strategy around scenarios 1 and 2 being more likely. Use the next five months to restructure your supply chain, not to wait and hope.

FAQs: Quick Answers for Ecommerce Sellers