Stores can take ripped money, and many will if the tear is small and the bill is obviously genuine, but no federal law forces them to. A cashier is within their rights to refuse a torn banknote. If that happens, your own bank will usually exchange a damaged bill for a clean one at the counter, and the Bureau of Engraving and Printing runs a free program for bills too damaged for a bank to handle.
Why a Store Can Refuse a Torn Bill
U.S. currency is legal tender “for all debts, public charges, taxes, and dues” under 31 U.S.C. § 5103.1Office of the Law Revision Counsel. 31 USC 5103 – Legal Tender That language covers debts already owed. Buying a sandwich isn’t a debt; it’s an offer to trade money for goods, and the seller sets the terms. The same rule that lets a shop post “no bills over $20” lets a cashier decline a note that looks damaged.
From the register’s side, the refusal is practical. Torn or taped bills jam automated counters, can throw off counterfeit detectors, and cause problems when the store deposits its take at the end of the day. A cashier who accepts a badly ripped $20 may end up eating the loss if the bank rejects it. A clean tear or a missing corner will usually pass; heavy damage tends not to.
Take It to Your Bank First
For most ripped bills, the bank is the fix. Federal regulations say unfit currency “may be exchanged at commercial banks” rather than sent to the Treasury.2eCFR. 31 CFR 100.5 – Mutilated Paper Currency A bill is considered unfit, as opposed to mutilated, when it’s still clearly recognizable but torn, dirty, limp, or worn, and more than half of the original note is intact with the denomination obvious.
If you tore a bill in half, tape it so the serial numbers line up and bring it to a teller. As long as clearly more than half of the note is present and the denomination is plain, the teller should hand you a replacement. Federal regulations allow a note that retains enough security features to verify its authenticity to be redeemed at full face value.2eCFR. 31 CFR 100.5 – Mutilated Paper Currency The bank then sends the worn note along with its regular deposit to the local Federal Reserve branch, which pulls it from circulation.3Federal Reserve Bank of St. Louis. What to Do with Ripped or Damaged Money
If the cash was exposed to mold, sewage, or chemicals, tell the teller. The bank may have a separate protocol for contaminated notes.
When the Damage Is Too Severe: The BEP Route
A bill counts as “mutilated” when half or less of the original note remains, or when the damage is severe enough that trained examiners have to determine the value. Fire, chemical exposure, prolonged water damage, and insect or rodent destruction are typical causes. A bank cannot exchange these. They go to the Bureau of Engraving and Printing, which examines them at no charge.4Bureau of Engraving & Printing BEP. Mutilated Currency FAQs When less than half of a note survives, the BEP will still redeem it if the examiner is satisfied that the missing portions were totally destroyed.2eCFR. 31 CFR 100.5 – Mutilated Paper Currency
How to File a Claim
You’ll complete BEP Form 5283, which you can fill out on the BEP website and print. The form asks for your contact information, an estimated total value, a short description of how the currency became mutilated with a rough timeframe, and banking information for the payment. Every required field has to be filled out; incomplete claims can be delayed or rejected.5Bureau of Engraving & Printing (BEP). How to Submit a Request for Mutilated Currency Examination
Do not tape mutilated fragments together; that can make the examiners’ work harder. Place pieces in plastic bags or wrap them in tissue paper so nothing shifts in transit, then ship the package to the Bureau of Engraving and Printing, Room 344A, 14th and C Streets, SW, Washington, DC 20228.5Bureau of Engraving & Printing (BEP). How to Submit a Request for Mutilated Currency Examination Registered mail with return receipt gives you proof of delivery. In-person delivery at the same address is also allowed.
What to Expect
Claims are processed first-in, first-out. The BEP does not publish a guaranteed turnaround, and complex cases can take many months while examiners piece fragments together and verify security features. Payment is made by electronic funds transfer, and claims of $500 or more must be redeemed that way, which is why the banking details on the form matter.6eCFR. 31 CFR 100.7 – Treasury’s Redemption Process
One caution: if the BEP finds evidence of intentional mutilation, an attempt to defraud, or material misrepresentation, the entire submission is destroyed or held as evidence and nothing is paid.7Bureau of Engraving & Printing. Mutilated Currency Redemption Don’t inflate the value you’re claiming.
Don’t Damage Cash on Purpose
Ripping a bill by accident is not a crime, and neither is running one through the wash. Deliberately destroying currency is. Under 18 U.S.C. § 333, mutilating, cutting, or defacing a Federal Reserve note with the intent to make it unfit for circulation is punishable by a fine, up to six months in prison, or both.8Office of the Law Revision Counsel. 18 USC 333 – Mutilation of National Bank Obligations Intent is the whole element. The statute is aimed at schemes that destroy portions of bills to submit inflated BEP claims, and the Bureau refers suspected patterns for investigation.