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What to do with Damaged Money

Published by Scott Hershman

Finding a couple of dollars on the ground can be exciting, but realizing that the bills are damaged can immediately ruin the mood. While it is illegal to deface or destroy US currency, accidents do happen, and money is occasionally damaged by natural means. If you have damaged currency, there is something that you can do in order to restore the value of the currency.

Is Damaged Money Still Usable?

Many stores and merchants will not take torn or drawn-on bills, and even vending machines struggle to take heavily wrinkled ones. The good news is that even if a bill is torn in half, you can tape them together and exchange them at a Federal Reserve bank for fresh notes, as long as the serial numbers match. When bills are shredded or suffer severe damage, then things become a bit more complicated, but all hope is not yet lost.

How Much of a Bill can be Missing?

For extreme cases of damage, you can send bills to the Department of the Treasury’s Bureau of Engraving and Printing (BEP) to be examined. They have a Mutilated Currency Division full of U.S. currency experts that examine mutilated bills and bent coins for free and will return an equivalent amount.

The bill(s) must meet one of two requirements in order to be eligible for an exchange from the BEP. The first is that more than 50% of the note is identifiable as United States currency. The second is if there is less than 50% of the note intact, but your evidence demonstrates, to the satisfaction of the Treasury, that the missing portions have been completely destroyed.

This procedure is actually commonplace and is usually used for burnt paper currency, though it doesn’t have to be just $100 bills.

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