What is the US Customs penalty for undervaluing or misdeclaring imports?
Quick answer
Under 19 U.S.C. 1592, a negligent false statement can cost up to twice the lost duties, taxes and fees, or 20% of dutiable value if no duty was lost; gross negligence up to four times, or 40%; fraud up to the domestic value of the goods. Negligence caps never exceed domestic value. A timely prior disclosure sharply reduces the penalty.
What does the law say? Key facts and official sources
| Item | What the law says | Source |
|---|---|---|
| Violation | Entering goods using a material false document, statement, data or act, or a material omission, by fraud, gross negligence or negligence (1592(a)(1)) | Official source |
| Clerical errors | Not violations unless part of a pattern of negligent conduct (1592(a)(2)) | Official source |
| Negligence | Up to the lesser of domestic value or 2x lost duties, taxes and fees; 20% of dutiable value if duties not affected (1592(c)(3)) | Official source |
| Gross negligence | Up to the lesser of domestic value or 4x lost duties, taxes and fees; 40% of dutiable value if duties not affected (1592(c)(2)) | Official source |
| Fraud | Up to the domestic value of the merchandise (1592(c)(1)) | Official source |
| Prior disclosure | Negligence or gross negligence: interest on the lost duties only; fraud: 100% of lost duties or 10% of dutiable value, if you tender the unpaid amount (1592(c)(4)) | Official source |
| Who is responsible | The importer of record, even when using a customs broker | Official source |
| Last verified | October 19, 2026 | Astor Ventures |
What counts as a 1592 violation?
Entering or trying to enter goods using a document, electronic data, statement or act that is material and false, or a material omission, through fraud, gross negligence or negligence. Typical examples are an undervalued invoice, a wrong country of origin or a wrong tariff number. Honest clerical errors and mistakes of fact are not violations unless they form a pattern of negligent conduct.
How is the penalty calculated?
It depends on culpability and on whether duty was lost. Example: if a negligent undervaluation cost the US $10,000 in duties, the maximum penalty is $20,000, or the domestic value if lower. If the error did not change the duty owed, the cap is 20% of dutiable value for negligence and 40% for gross negligence.
Can a prior disclosure reduce the penalty?
Yes. If you disclose the violation before, or without knowledge of, a formal investigation and pay the unpaid duties at the time or within 30 days of CBP's calculation, a negligence or gross-negligence penalty drops to interest on the unpaid duties, and merchandise is not seized.
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What else do people ask?
Is my customs broker liable instead of me?
CBP says the importer of record is ultimately responsible for the correctness of the entry documents and for all duties, taxes and fees, even when using a broker.
What if the mistake did not change the duty?
The caps become a share of dutiable value: up to 20% for negligence and 40% for gross negligence (1592(c)(2)-(3)).
Which version of the law is this?
The penalty amounts are read from the official US Code text on govinfo.gov; check the current code before relying on them.
Is this legal advice?
No. General information only. Talk to a licensed customs broker or attorney about a real case.