Costco Wholesale has received $184 million in refunds and interest on Trump tariffs the Supreme Court struck down, plus $155 million more since its fiscal year ended Aug. 30. The warehouse club disclosed both figures in its annual report, which it filed with the Securities and Exchange Commission on Oct. 6. Costco says it paid the government approximately $500 million in the duties under the International Emergency Economic Powers Act, known as IEEPA.
The $184 million covers fiscal 2026, the year that ended Aug. 30, 2026. Costco’s 10-K splits it into $174 million in refunds, recorded as a reduction to merchandise costs, and $10 million recorded as interest income. The filing adds one sentence for the period after the year closed: “Subsequent to 2026, we received $155 in additional refunds,” in the filing’s convention of millions of dollars.
For a Costco member, the open question is whether any of that money shows up at the shelf. The company says “a portion of these refunds was invested in reducing prices for members” and that it intends “to continue to invest the majority of the refunds in increased value for the member.” The filing does not list which items got cheaper or by how much, so members who pay the $65 annual U.S. membership fee are left with a direction of travel rather than a price list.
Costco says refunds may be delayed while the government keeps building its refund process, so the next payment has no date yet.
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Two refund figures that should not be added carelessly
The two numbers sit on different calendars. The $184 million belongs to the fiscal year that ended Aug. 30. The $155 million arrived afterward, between that date and the filing. Put together they come to $339 million, a little over two-thirds of the roughly $500 million Costco says it paid in IEEPA tariffs, though the company does not present that sum itself.
The $184 million also mixes two kinds of money. The $174 million is repayment of tariffs Costco already paid, which lowers what the company counts as the cost of the goods it sold. The $10 million is interest on that repayment, and it goes through a different line of the income statement as interest income. The filing does not say whether the $155 million contains interest, and it does not break that later amount into parts.
Why Costco booked nothing until the cash arrived
Costco explains that it treated the refunds as a gain contingency under Accounting Standards Codification 450-30, “recognizing recoveries in our consolidated statements of operations only as they were realized.” In plain terms, the company did not count any refund as income while it was only a legal possibility. Nothing appears in the results until money actually comes back from the government.
That is why the $155 million is described in a subsequent-period sentence and not in the year’s results. It will show up in Costco’s next fiscal year, which began after Aug. 30, once the company reports those quarters.
What it did to the margin
The refunds barely moved Costco’s profit margin, because so much of the money went back out. In its gross margin discussion, Costco says “IEEPA tariff refunds, net of investment in price reductions for members,” improved gross margin by three basis points, or 0.03 percentage point. Gross margin came in at 11.09% for fiscal 2026 against 11.12% a year earlier, so the refunds helped but did not turn the year around.
Merchandise costs rose to $264,279 million from $239,886 million, which is roughly $264.3 billion against $239.9 billion. Against a bill that size, a $174 million credit is small. Membership fees tell the other side of the model: membership fee revenue increased 11% to $5,907 million, about $5.9 billion, and the annual U.S. fee is $65.
How the Supreme Court ruling led to the refunds
The refunds trace back to February 2026. Costco’s filing says “the U.S. Supreme Court ruled that the IEEPA tariffs were unlawful,” and that the government then “launched a program to administer IEEPA refunds.” A law-firm alert from A&O Shearman dates the decision to Feb. 20, 2026, and describes the holding in one line: the IEEPA does not authorize the president to impose tariffs.
Costco began filing for refunds and was paid in the months that followed. The company cautions that “refunds may be delayed as the government continues to implement the IEEPA refund process,” which is the main reason the $155 million cannot be read as the last installment. The filing gives no estimate of how much more is coming.
The Illinois lawsuit asking who keeps the money
Costco is also a defendant in a consumer case over exactly this money. Stockov v. Costco Wholesale Corp., filed in March 2026 in the U.S. District Court for the Northern District of Illinois, is a proposed nationwide class action. According to Inna Brady’s article in Washington Lawyer, the plaintiffs allege Costco raised prices to cover tariff costs and now stands to recoup them as well, a “double recovery,” and that the company could receive “potentially more than one billion dollars.”
Costco moved to dismiss. As summarized in the article, it argued that the double recovery had not happened because it had not yet received an IEEPA refund from Customs and Border Protection, and that its customers “got what [they] paid for.” The article, in the magazine’s September/October issue, said the court had not yet ruled. The 10-K filed on Oct. 6 now reports refunds received. Nothing in the filing describes how the company would handle a court order to pass money on.
Tracking Costco’s refunds through the next filings
Anyone following the money can go straight to the source. Costco’s complete filing record on the SEC’s EDGAR system is free and shows the 10-K as filed on Oct. 6, 2026, along with every later report. The tariff discussion sits in the management’s discussion section under the heading on tariff impacts.
Three lines are worth comparing when the next quarterly report arrives: refunds received since the year ended, the merchandise-cost line where refunds are credited, and any new wording about price reductions for members. A larger cumulative refund total with an unchanged gross margin would point to the money going back to shoppers. A rising margin would point the other way.
The company’s own caution is the best guide to what happens next. Its filing states that “higher tariffs are more likely to adversely impact rather than improve our results,” a reminder that the refunds are repayment of past duties and not a sign that Costco expects tariff costs to fall.
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This article was produced with AI assistance and reviewed by The Financial Wire’s editorial team.
Warren Cohen is a finance writer based in Phoenix, Arizona, covering personal finance topics including credit, banking, and beginner investing. He earned his degree in business administration from Arizona State University and began his career working in consumer finance, where he gained direct experience with lending and credit systems. He now writes for personal finance websites and fintech platforms, focusing on clear, practical content that helps readers make informed financial decisions.
