Starting October 2024: Why Some Dollar Bills Might Be Rejected at Stores and Banks

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Starting in October 2024, U.S. stores, businesses, banks, and ATMs will stop accepting certain damaged or "mutilated" dollar bills as part of a new initiative led by the Bureau of Engraving, the Secret Service, and the Advanced Counterfeit Deterrence (ACD) Steering Committee. This effort aims to strengthen the security of the U.S. monetary system and reduce the circulation of counterfeit or severely worn bills.

What Defines a "Mutilated" Bill?

A dollar bill is considered "mutilated" if it has been damaged due to fire, misuse, or environmental factors such as moisture or being buried. Examples of mutilation include bills that are torn, discolored, or missing significant portions. These bills are particularly vulnerable to counterfeiting and pose challenges in maintaining the integrity of the monetary system.

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Affected Denominations

While the U.S. Federal Reserve issues seven denominations—$1, $2, $5, $10, $20, $50, and $100—this new rule applies to any bills classified as mutilated, regardless of their denomination. Additionally, although higher denominations such as $500, $1,000, and $10,000 bills are no longer in production, they remain in circulation and are also subject to rejection if they fall under the mutilated category.

What to Do with Mutilated Bills?

If you possess a mutilated bill, the U.S. Bureau of Engraving and Printing offers a process to redeem it. Consumers can file a "mutilated currency claim," after which the Bureau will evaluate the authenticity and value of the bill using specialized tools. Once verified, the Bureau will issue a reimbursement to the individual.

Future Currency Design Changes

In addition to the new rules regarding mutilated bills, the Federal Reserve has announced plans to introduce redesigned bills for enhanced security. The $50 bill is scheduled for redesign in 2028, followed by the $20 bill in 2030, the $5 bill between 2032 and 2035, and the $100 bill between 2034 and 2038. These updated designs will feature advanced security measures, such as color-shifting ink and 3D security strips, to further deter counterfeiting efforts.

This initiative marks a significant step toward modernizing U.S. currency and ensuring the continued security and reliability of the nation's monetary system. As this policy is phased in, consumers and businesses alike are encouraged to check their cash and exchange any damaged bills to avoid disruptions.