# Reconciliation entries: correcting estimated duties without triggering an audit | TariffTrack HQ

Source: https://tarifftrackhq.com/blog/reconciliation-entries-correcting-estimated-duties-2026-10-12/

Sometimes you do not know the final price when the goods cross the border. Reconciliation is CBP's official process for fixing the estimate later, and using it correctly keeps an estimate from becoming a violation.

## When entered value is legitimately unknown

Reconciliation exists for the common commercial reality that final value is not known at import. Related-party transactions are the classic case: the transfer price is provisional and adjusted later. Royalties tied to sales, assists apportioned over production, and volume rebates that settle quarterly all create the same problem.

The alternative to reconciliation is guessing and hoping, which is how importers end up with material misstatements. CBP created the reconciliation program precisely so importers would flag uncertain entries upfront instead of filing entries they know are wrong.

Flagging is the key mechanic. At entry, you mark the entry for reconciliation on the specific issues that are uncertain: value, classification, or 9802 claims. The flag tells CBP that a correction is coming, which transforms a later adjustment from a suspicious amendment into a planned true-up.

## What reconciliation can and cannot cover

Reconciliation covers value issues like related-party pricing adjustments, assists, royalties, and rebates. It covers classification changes when the correct classification was genuinely uncertain. And it covers 9802 claims for US goods returned or assembled abroad.

It does not cover everything. Antidumping and countervailing duties cannot be reconciled; those entries live under their own suspension and liquidation rules. And reconciliation cannot fix entries that were never flagged: the flag at entry time is what makes the later correction part of the program.

The distinction matters most for importers who discover an error after the fact. An unflagged entry with wrong value is a candidate for prior disclosure, not reconciliation. The programs solve different problems, and using the wrong one wastes time and credibility.

## How the filing actually works

Reconciliation entries aggregate the flagged issues across entries over a period, typically twelve months. Instead of amending dozens of entries individually, you file one reconciliation entry per issue type covering all the affected entries. The aggregation is the program's main administrative benefit.

Timing has rules. The reconciliation entry is due within twelve months of the import date of the underlying entries, with the possibility of extension. Missing the deadline forfeits the program's protections for those entries, so calendar management is not optional.

Documentation carries the filing. For value reconciliations, that means the transfer pricing policy, the actual adjustments, and the computation tying the adjustment to the flagged entries. CBP reviews reconciliations, and a well-documented one sails through while a thin one invites questions.

## Reconciliation without inviting extra scrutiny

The fear that flagging entries invites audits is widespread and mostly backwards. Flagged entries with timely, documented reconciliations demonstrate reasonable care, which is the standard CBP applies. The importers who attract attention are the ones with suspicious patterns and no flags.

Consistency is what keeps the program boring in the best way. Flag the same issue types the same way, file on the same schedule, and document with the same rigor every period. A reconciliation program that runs like clockwork reads as a compliance function, not a confession.

The one thing that does invite scrutiny is reconciling in only one direction. If every reconciliation for five years reduced your duties, CBP will wonder about the methodology. Honest estimates miss both ways; a program that only ever finds overpayments looks like planning, not estimation.

## Setting up reconciliation for a small importer

You do not need a large trade team. You need your broker to flag the right entries, a calendar with the filing deadlines, and a folder per period with the supporting computations. Most small importers reconcile one issue, usually related-party value or assists, on a simple annual cycle.

Start the conversation with your broker before the next shipment, not after a problem. The flag has to be on the entry when it is filed; retroactive flagging is not available. One planning meeting sets up a year of clean reconciliations.

Review the program annually. If the reconciled adjustments are consistently tiny, the estimates are good and the program is working. If they are consistently large in one direction, fix the estimation process; reconciliation is a correction mechanism, not a substitute for getting the entry right.

## Frequently asked questions

### Can I reconcile entries I forgot to flag?

No; flagging must happen at entry. Unflagged errors go through prior disclosure instead.

### What is the deadline for filing a reconciliation entry?

Twelve months from import, extendable. Treat it as a hard deadline.

### Does flagging entries for reconciliation increase audit risk?

No; proper flagging and timely filing demonstrate reasonable care.

### Can antidumping duties be reconciled?

No; AD/CVD entries follow separate suspension and liquidation rules.