The numbers are brutal. A 224% increase in tariff payments in one year. Then the Supreme Court struck down IEEPA tariffs — relief, but also a new set of problems. Here's what's actually happening, what it means for your cash flow, and what you need to build into your financial forecast right now.
The Current Tariff Landscape (April 2026)
Stop treating this as a single event. There are four separate tariff regimes affecting small businesses simultaneously:
What This Means for Your Cash Flow Model
Here's the problem: most small business financial models have a single "COGS" line and a single "taxes/duties" line. That's not enough anymore.
You need four distinct layers in your April 2026 forecast:
Layer 1: Known, Stable Tariff Costs
- Section 301 (China)
- Section 232 (steel/aluminum)
These are predictable. Model them as fixed cost increases on affected SKUs. If you don't know your tariff exposure by HS code, get your customs broker to run a report this week.
Layer 2: Section 122 Costs (Active but Contested)
- 10% global surcharge, currently active
- Has a legal sunset (150 days without Congress = expires late July 2026)
- Model as a cash outflow through July 2026, with a scenario where it continues
Build two scenarios for this line:
- Base: Expires July 2026 (Congress doesn't extend)
- Bear: Extended indefinitely + additional country-specific rates
Layer 3: IEEPA Refund Inflows (Potential but Uncertain)
Don't book refunds as income until you have a liquidation date. This is the one most businesses are getting wrong — modeling refunds as income before they're received.
What's actually happening:
- CBP is processing entries via CAPE Phase 1
- Refunds flow through standard liquidation process (60-180 day window)
- Re-liquidated entries are also eligible (still within 180-day protest period)
- Businesses must submit claims proactively — this isn't automatic for everyone
How to model it:
- Conservative model: 10-30% probability of Q3 2026 receipt, 50-60% probability Q4 2026
- For large refunds ($100K+), get customs counsel involved — timing matters for working capital planning
Layer 4: Supply Chain Cascade Effects
Often missed: if YOUR suppliers are absorbing tariff costs, they will pass them through eventually. Model a 5-15% cost increase from key suppliers in H2 2026 as a bear case assumption.
The 5 Actions CFOs Are Taking Right Now
- Audit your HS code exposure. You can't manage what you haven't mapped. Get a full import/export analysis from your customs broker. Know exactly which tariff regimes apply to your supply chain and at what rates.
- File IEEPA refund claims if eligible. If you've been paying duties under IEEPA authority since April 2025, you may be eligible for refunds. CBP has expanded CAPE Phase 1 — submit claims now. Every week you delay is cash you're not recovering faster.
- Renegotiate supplier contracts for tariff pass-through. Any contract signed before February 2026 has ambiguous tariff language. Renegotiate to clarify who bears the cost if Section 122 continues and who benefits if IEEPA refunds flow through.
- Build scenario models into your Q2 forecast. Your Q2 2026 cash forecast needs at minimum three variants: tariff-stable (current rates hold), tariff-relief (Section 122 expires + IEEPA refunds arrive Q3), and tariff-escalation (new Section 301/232 investigations add rates in Q3).
- Brief your board before they ask. Your board will ask about tariff exposure at the next meeting. Be the CFO who already has the answer — with a quantified dollar impact and a specific action plan, not a "we're monitoring it."
A Simple Tariff Impact Calculator
Here's a back-of-envelope model for any business:
| Step | Calculation | Example |
|---|---|---|
| 1. Imported COGS | Annual COGS with imported goods | $2,000,000 |
| 2. Blended tariff rate | China exposure: 20-30%; Non-China + Section 122: 10% | 20% |
| 3. Annual tariff cost | Imported COGS × blended rate | $400,000 |
| 4. Monthly cash impact | Annual tariff cost ÷ 12 | $33,333 |
At $33K/month, you have a serious working capital management problem if you're also waiting 60 days to collect receivables.
The Bottom Line
Tariff uncertainty isn't going away. Even with IEEPA struck down, Congress can pass new tariff legislation. Section 301 investigations are expanding. The 150-day Section 122 clock is ticking.
The CFOs who win in this environment are the ones who've built scenario-based cash flow models that can absorb tariff shocks — not the ones who are still running single-scenario forecasts in a spreadsheet.
The CFO Stack's scenario planning module lets you build multiple tariff scenarios into your rolling 13-week forecast, automatically updating when your accounting data syncs. When a tariff changes, your forecast changes in real time — not next quarter when you finally get around to updating the spreadsheet.
Model your tariff scenarios now
Build multiple tariff scenarios into your rolling cash flow forecast. Connect QuickBooks or Xero and see the impact in real time.
Frequently Asked Questions
Editorial note: This guide was written by the CFOTechStack editorial team and reflects tariff conditions as of April 13, 2026. Tariff rates, refund timelines, and legal challenges are subject to change. Consult your customs broker and legal counsel for advice specific to your business. Sources: National Small Business Association, CBP CAPE portal documentation, Supreme Court ruling Feb 20, 2026.