When your company imports into the U.S., pays duties, and later exports or destroys goods, you are likely eligible for duty drawback. This checklist walks through the key questions to determine eligibility and outlines how to move from “maybe” to filing a refund claim.

What duty drawback is

Duty drawback (often just “drawback”) is a U.S. Customs program that allows companies to recover most duties, taxes, and fees paid on imports when the goods (or products made from them) are later exported or destroyed in the U.S.

You may be eligible for a refund when your company:

• Exports goods you previously imported and paid duty on.
• Uses imported inputs to manufacture products that are then exported.
• Sells imported items to a U.S. customer who later exports them.
• Destroys imported goods or finished products in the U.S. instead of exporting them.

If your business regularly imports and exports or destroys inventory, there is likely a drawback opportunity.

Step-by-step eligibility checklist

1. Have you paid customs duties?

Drawback is only available where duties, taxes, or fees were actually paid at import. Review your:

• Customs entries
• Commercial invoices
• Data in U.S. Customs and Border Protection (CBP)’s Automated Commercial Environment (ACE)

Confirm that dutiable entries exist and that you can access the documentation.

2. Were the goods exported or destroyed?

Drawback applies when qualifying merchandise:

• Is exported from the U.S. (either without further production or as part of a finished product), or
• Is destroyed in the U.S.

Exports and destructions can support recovery if properly documented.

3. Are your records complete and accurate?

Successful claims depend on clean, detailed records connecting imports to exports or destruction events. Typically, you will need:

• Import and export declarations
• Inventory receiving, movements, and withdrawals
• Bills of material or production records
• Shipping and export documentation

Gaps or inconsistencies here are one of the main reasons refunds are delayed or denied.

4. Are you within the filing window?

CBP imposes strict time limits. A drawback claim must be filed within 5 years of the import date.
When companies start a program, they usually:

• Look back over the previous 5 years of exports or destructions, then
• Establish an ongoing cadence to keep claiming refunds going forward.

If your eligible imports are more than 5 years old, they cannot be recovered.

5. Do you meet compliance standards?

To benefit from drawback, your broader customs posture must be sound. That includes:

• Correct product classification and valuation methods
• Consistent use of HTS codes
• Effective document retention policies

Strong compliance reduces audit risk and helps ensure claims are paid quickly.

Common qualifying scenarios

Your company may have drawback potential if you recognize any of the following:

• Returned or rejected imports that are exported or destroyed
• Export of overstock or excess inventory
• Regular shipments of merchandise to foreign buyers
• Purchases of imported goods from a domestic vendor that you then export
• Sales of imported goods to a customer who later exports them
• Use of imported raw materials/components in finished goods that are exported
• Any combination of these import–export flows

If there is a dutiable import on one side and a qualifying export or destruction on the other, there is often a drawback opportunity.

How to apply for duty drawback

Drawback can be complex, if you have imports and exports, it may be best to discuss your intent to begin claiming drawback with a Drawback Broker before going too far into the process.

1. Map your supply chain

Document how goods move through your business:

• What are you importing?
• Who are you buying from and are they importing?
• Where and how goods are stored, processed, or manufactured?
• Are you exporting goods?
• Are you destroying or disposing of goods?
• Are you selling to a company who is exporting your goods?

This mapping is the foundation for matching imports to exports or destruction.

2. Review eligibility by provision

Compare your flows against the different drawback provisions (for example, unused merchandise, manufacturing, rejected merchandise). Confirm:

• Which provision (or mix of provisions) fits your operations
• That your actual processes and data support the regulatory requirements

3. Gather and normalize documentation

Collect and organize:

• Import and export data
• Inventory and manufacturing records
• Bills of material and production runs
• Shipping, destruction, and related support

The more structured and digitized your data, the easier it is to pursue refunds.

4. Apply for drawback privileges

To establish your drawback program and provide CBP with the necessary details, you must prepare and submit a Combination Application for Drawback Privileges.

5. Submit claims

A licensed customs broker or drawback specialist can prepare and file claims on your behalf. Once your privileges are approved, claims are typically paid within about 4-6 weeks from filing.

Modern platforms such as Flexport’s duty drawback solution can streamline these steps and, in many cases, increase total refunds by double-digit percentages through better matching and automation. Flexport’s duty drawback team can streamline the claim process, and potentially boost your refund by more than 15% with our modernized drawback platform.

Why work with a specialist like Flexport

Unclaimed drawback is effectively trapped cash. Regularly reviewing your imports, exports, and duty spend and beginning on your drawback program can help you improve cash flow through recurring refunds.

The challenge is that drawback rules are complex, data is fragmented, and small mistakes can mean reduced or denied refunds.

Partnering with a specialist such as Flexport helps your company:

• Identify all eligible transactions across multiple systems and entities
• Structure, document, and file claims correctly and on time
• Maintain a robust audit trail to support CBP review

By combining experienced drawback experts with a modern, digital platform, Flexport reduces manual work, minimizes compliance risk, and helps convert more of your historical and ongoing duty spend into cash that would otherwise be left on the table.