Direct identification. You trace the exported goods, or the products made from them, back to a specific import entry and line.
For goods mixed in inventory, CBP accepts accounting methods such as first-in first-out, last-in first-out, low-to-high and average.
Substitution. Goods in the same 8-digit HTS subheading stand in for the import (for unused merchandise, 10 digits where the 8-digit description begins with "other").
For unused merchandise, you must have possessed the substituted goods before export.
Drawback is capped at 99% of the lesser of the duty on the import and the duty the exported article would bear if it were imported.
Two rules apply to both. An import line can't be split between the two methods; the first accepted claim sets its basis.
And the lesser-of cap can cut a substitution claim when duties differ by country of origin, as many 2026 Chapter 99 duties do.
How CBP applies the cap in those cases isn't settled, so your broker decides line by line.
Written by the NexQloud Drawback team from the primary sources linked on this page.
Not legal advice. NexQloud Drawback is not a government agency.
NexQloud Drawback is software used by licensed customs brokers.
