Section 122 Replaced IEEPA in February 2026 and Expired on July 24, 2026. Here's What Every Importer Needs to Know.

Three days after the Supreme Court killed IEEPA tariffs, a Section 122 proclamation replaced them — and that authority has since expired too, on July 24, 2026. Section 122 of the Trade Act took effect February 24, 2026. If you haven't updated your landed cost calculations, you're working with the wrong numbers.

This is what changed, who it affects, and what the new tariff stack actually looks like.

The 30-Second Version

• IEEPA tariffs: struck down by the Supreme Court on February 20, 2026
• Section 122: replaced IEEPA effective February 24, 2026
• Section 122 rate: 10% flat on most imports into the United States
• Section 122 expiration: July 24, 2026 (150-day authority under the Trade Act)
• Exempt: USMCA partners (US, Mexico, Canada)
• Exempt: Products subject to Section 232 (steel, aluminum, derivatives)

How the Stack Looks Now That Section 122 Is Gone

This is the part that confuses most people. Section 122 never replaced all tariffs. It replaced IEEPA specifically, and its own authority has since lapsed. Your Section 301 China tariffs still apply. Your Section 232 steel and aluminum tariffs still apply. The layer that took Section 122's place on July 24, 2026 is a Section 301 forced-labor action, and unlike Section 122 it is not a flat global rate and USMCA partners are not exempt from it.

Here is what the full stack looks like today for a common scenario, electronics from China. These figures are the output of our own duty engine, run on August 5, 2026, and they apply to entries on or after July 24, 2026. That date matters: the stack changed three times this year, so a figure without an as-of date is not a figure:

Compare that to the same product imported from Mexico. This is where the most expensive assumption in the trade press shows up, so read the total carefully:

That is a 40 percentage point spread on a qualifying good, and it is the arithmetic behind the China Plus One strategy. But read the last row carefully, because the zero is conditional and it is the condition that catches people out. The forced-labor layer is waived only on a good that is USMCA-qualified AND entered free of duty, under heading 9903.05.94. Fail the rules of origin, or file without a valid certificate, and the same product is 12.7%.

And the zero can disappear the moment the article falls inside Section 232 scope, because USMCA does not waive Section 232. We are not going to hand you a list of eight-digit codes that "are" inside scope, because that is precisely the mistake that costs money: the Chapter 99 headings that carry these duties are written against what the article IS, not against its subheading. The same eight-digit line can sit under two headings at once — one adding 25% and one adding nothing — with the deciding fact being whether the goods are a completed cabinet rather than a part, or a medium-duty vehicle part rather than a passenger-car part, or steel by weight rather than incidentally containing steel.

So the practical rule is: your subheading tells you which questions you have to answer, not what you owe. Run your actual part through a tool that asks those questions, and have your broker confirm the answer before you file. Where the primary sources genuinely conflict, we say so rather than pick — see the auto-parts example further on, where a proclamation, the current HTSUS and a CBP message point one way and our own engine points the other, and we publish the range.

What USMCA Actually Buys You, and What It Does Not

Under IEEPA, Mexico-manufactured goods that qualified under USMCA were still subject to the 25% fentanyl surcharge if CBP couldn't confirm full USMCA compliance. Section 122 removed that layer entirely for USMCA-compliant goods, for the five months it was in force.

That is the part most landed-cost models never updated. The Section 301 forced-labor action that replaced Section 122 on July 24, 2026 does carry a USMCA exemption, but a narrower one: heading 9903.05.94 waives it only where the good is USMCA-qualified and enters free of duty. Fail qualification and the same Mexican good pays 10% under 9903.05.55. And no amount of qualification touches Section 232, which stands at 25% on a covered article.

For companies that have invested in nearshoring to Mexico, the advantage over China-origin goods is still large and still real. On the control-panel example above it is the full 40.2 percentage points, because that article is outside Section 232 scope and a qualifying entry genuinely reaches zero. Move to an article inside Section 232 scope and the same comparison narrows to 27.5 points, because 25% survives on the Mexican side.

Section 232 Products Are Treated Separately, With a Catch

Steel (HS chapters 72, 73) and aluminum (chapter 76) products were exempt from Section 122 because they were already subject to Section 232 tariffs, and the same carve-out logic carries over to the forced-labor layer that replaced it: goods inside Section 232 scope are excluded from it rather than stacked with it. The treatment also covers downstream derivative products, but here's where it gets complicated.

Not all derivative products are auto-exempt. If your product contains steel or aluminum but isn't primarily classified as steel or aluminum, a material determination may be required before the Section 232 exemption applies. Triangle's tariff calculator flags these products and routes them through the preflight questions before applying the exemption.

What to Do in the Next 30 Days

Recalculate your landed costs. The tariff stack changed on February 24. If you're still quoting customers or making sourcing decisions based on IEEPA rates, your numbers are stale.

Verify your USMCA qualification status. If you manufacture in Mexico, your qualification documentation needs to be current — USMCA origin is what lets you use the preferential lines at all, and on a Section 232 derivative article it is the difference between the note 16(j) split and 25% on the whole entry. CBP will audit. (Section 122, which this paragraph used to cite, expired on July 24, 2026.)

Check your Section 301 exclusions. There are several hundred active exclusions that may reduce or eliminate the Section 301 layer for specific HS codes (462 as of August 2026 — the list moves, so check yours rather than relying on a number in a blog post). The exclusion check is included in Triangle's free tariff lookup.

Model the China vs. Mexico comparison. The current tariff spread between China-origin and USMCA-qualified Mexico-origin goods is at its widest point in years. If you've been running the numbers and they were close before, run them again.