Duty Drawback Deadlines: Understanding the Five-Year Rule Before Refunds Expire

Updated: February 26, 2026

Editor’s Note: This article has been updated to reflect current drawback law under 19 U.S.C. §1313 and modernized regulations under 19 CFR Part 190.

How the Five-Year Clock Actually Works

The five-year drawback deadline runs from the import date of the merchandise being designated in the claim. For unused merchandise and manufacturing drawback under modernized TFTEA rules, exports must generally occur within five years of import, and claims must be filed within the statutory timeframe established under current regulations.

This creates a rolling expiration structure. Every import entry has its own independent five-year deadline.

For example:

Imports made in March 2021 will expire in March 2026.
Imports made in December 2021 will expire in December 2026.

Eligibility does not expire all at once. It phases out continuously.

Why Companies Miss Duty Drawback Deadlines

Many importers assume drawback can be implemented quickly if needed. In reality, building a compliant drawback program requires:

• Eligibility analysis by HTS classification
• Import and export data reconciliation
• Privilege applications where required
• ACE electronic filing setup
• Development of audit-ready documentation controls

Depending on supply chain complexity, implementation can take weeks or months. Meanwhile, the five-year clock continues to run.

Companies that wait until the fourth or fifth year to begin analysis often discover that portions of their import history have already expired.

The Financial Impact of Delay

In elevated tariff environments, duty exposure can be substantial. When qualifying goods are later exported or destroyed, drawback may allow recovery of up to 99 percent of eligible duties.

However, once the five-year deadline passes, those duties become a permanent cost.

For manufacturers, distributors, and exporters operating at scale, unclaimed drawback can materially affect margin performance, particularly in periods of tariff volatility.

Rolling Expiration Risk and Tariff Strategy

Duty drawback deadlines should be monitored as part of a broader tariff management strategy.

A structured review should evaluate:

• Historical duty spend by year
• Export volumes and timelines
• Unused merchandise eligibility
• Manufacturing substitution opportunities
• Interaction with Post Summary Corrections where applicable

Because expiration risk is continuous, drawback evaluation should not be treated as a one-time project. It should be integrated into ongoing compliance and financial planning processes.

Protecting Recoverable Duties Before They Expire

The five-year rule is clear. Once eligibility expires, it cannot be restored through protest, correction, or appeal.

Companies that have paid significant duties in recent years should evaluate their exposure well before the final year of eligibility. Early assessment allows sufficient time for data validation, application filing, and compliant claim preparation.

If your organization has not conducted a recent drawback review, now is the appropriate time to determine whether recoverable refunds remain within the statutory window.

Contact us today to schedule a duty drawback deadline assessment and identify whether any of your historical imports are approaching expiration.