It’s true: U.S. Customs will increase the informal entry value limit from $2000 to $2500 on January 7, 2013.

To understand why this is good news for importers, you must first understand the difference between a formal and informal entry.

A formal entry is required for imported merchandise valued at over $2000. For this type of entry, Customs requires importers to complete CBP form 7501 and pay a merchandise processing fee of at least $25.

If the merchandise is valued at $2000 or less, it qualifies for an informal entry. This type of entry requires a 7501 form and the merchandise processing fee is only $2 if the entry is filed electronically.

So, to recap, in comparison to a formal entry, an informal entry is less costly and less of a hassle to the importer.

By increasing the informal entry value limit to $2500, Customs is allowing more goods to qualify for informal entry.

According to an information notice distributed by Customs, the limit was increased to “mitigate the effects of inflation…and harmonize the value thresholds to $2500 for expedited customs clearance.”

In addition to the increased informal entry limit, Customs will no longer require a formal entry for certain articles that were subject to absolute quotas under the Agreement on Textiles and Clothing.

Read the final rule in the Federal Register, here.