Will the Bank Replace a Torn Bill? Unfit vs. Mutilated Currency

Yes, a bank will usually replace a torn bill at full face value, provided clearly more than half of the note is still there and the denomination is easy to read. Tellers handle worn, ripped, taped, stained, or faded currency as a routine swap. Bills that are burned to fragments, half-missing, or fused together are a different matter: those have to go to the Bureau of Engraving and Printing rather than your local branch.¹

Unfit or Mutilated: Which Category Your Bill Falls Into

Federal regulations sort damaged paper money into two buckets, and that sorting decides where you take it.

A bill is “unfit” if it is torn, dirty, limp, worn, or defaced but still shows more than half of the original note and a teller can identify the denomination without special expertise. Unfit currency can be exchanged at any commercial bank willing to accept it.¹

A bill is “mutilated” when half or less of the original note remains, or when the damage is severe enough that its value is questionable and trained examiners need to look at it. Badly charred bills, notes water-soaked into fragments, and chemically deteriorated currency generally fall here. Mutilated currency cannot be exchanged at a bank or deposited with the Federal Reserve. It goes to the Bureau of Engraving and Printing.²

Exchanging a Torn Bill at the Bank

If your bill is unfit rather than mutilated, walk it up to a teller and ask for a replacement. The teller confirms that more than half is clearly present and the denomination is identifiable, takes the damaged note, and hands you a clean one at full face value. There is generally no paperwork on your end.

One thing to know before you go: banks are permitted to make these exchanges, not required to. Most branches will do it as a courtesy, especially for account holders. If you don’t bank there, the branch may turn you away and point you to your own institution. No federal rule forces a particular bank to take your damaged note, so results vary.¹

Exchanging a large volume of damaged cash — say, currency recovered from a house fire — triggers ordinary reporting rules. Any cash transaction above $10,000 in a single business day requires the bank to file a Currency Transaction Report with the Financial Crimes Enforcement Network. That’s routine compliance, not a sign the bank suspects anything.³

When the Bank Can’t Help: Sending It to the BEP

If a teller looks at your bill and can’t confirm what it is, or if half or less of the note is left, you’re in mutilated-currency territory. The BEP’s Mutilated Currency Division examines these submissions for free.⁴

Every submission needs a completed BEP Form 5283. It asks for your contact information, the estimated value of the currency, and a short description of how the damage happened. You sign and date a certification that you are the lawful holder and that everything you’ve stated is accurate. If the payout will be $500 or more, the form requires electronic funds transfer details.⁵

Turnaround is slow. Standard requests generally take six to 36 months depending on complexity and workload. Once examiners verify what they can, the Treasury pays out by check or electronic transfer.⁶

Packaging Fragile Bills for Shipment

The overriding rule is to disturb the fragments as little as possible. Do not unroll rolled currency. Do not flatten, tape, glue, or laminate flat bills. Brittle notes should be cushioned in cotton in a sturdy box, fragments left as they are. If the bills were in a purse, safe, or box when damaged, send that container with the bills still inside. Remove any coins or metal, which will grind the paper apart in transit. Poor packing can get your claim denied.⁷

Where to Send It

The BEP recommends USPS Registered Mail with Return Receipt Requested. Standard mail classes cap insurance on currency at just $15, while Registered Mail covers up to $50,000.⁸

By USPS:
Bureau of Engraving and Printing
Mutilated Currency Division, Room 344-A
P.O. Box 37048
Washington, DC 20013

By private carrier (FedEx, UPS, etc.):
Bureau of Engraving and Printing
Mutilated Currency Division, Room 344-A
14th and C Streets, SW
Washington, DC 20228²

How the BEP Decides What You Get Paid

Examiners pay full face value when clearly more than 50 percent of a note is present along with enough security features to confirm it as genuine U.S. currency. You can also be paid in full when 50 percent or less remains, but only if the circumstances and evidence convince the Treasury that the missing portion was totally destroyed rather than sitting in someone else’s hands.⁹

Claims are denied outright in several situations: deliberate mutilation or fraud, currency tied to criminal activity, material misrepresentations on the form, fragments that cannot be identified as U.S. currency, and cases where half or less of a note remains and the Treasury isn’t satisfied the rest was destroyed. Currency that has been completely destroyed, with no fragment left to examine, is also ineligible. The regulation is explicit that no relief will be granted for paper currency that is totally destroyed.¹⁰

If the Teller Thinks Your Bill Is Counterfeit

Handing over a damaged bill carries one risk worth knowing about. If the teller decides the note is counterfeit rather than genuinely worn, the bank confiscates it. You get no replacement and no reimbursement. Federal Reserve Banks won’t accept counterfeit deposits, and suspect notes are forwarded to the U.S. Secret Service.¹¹

The bank submits the note using Secret Service Form 1604, which requires it to abandon any property interest in the bill. If the Secret Service later determines the note is genuine, it goes back to the submitter. Otherwise it is permanently seized. If you unknowingly took a counterfeit bill as change, you absorb the loss.¹²

A Note on Contaminated Bills and Damaged Coins

Two categories sit outside the normal bank-swap process. Currency exposed to mold, bodily fluids, sewage, or hazardous chemicals may still be deposited at a commercial bank, but only under the Federal Reserve’s contaminated currency procedures, which include advance written notice to the local Reserve Bank cash office and double-bagging in clear, tamper-evident bags marked “CONTAMINATED.” Currency exposed to fentanyl should not be deposited at a bank at all until further guidance is issued.¹³²

Damaged coins are their own situation. Worn but whole coins can be deposited at a commercial bank, which passes them to the Federal Reserve. Bent, partial, or fused coins have no redemption path: the U.S. Mint’s Mutilated Coin Redemption Program has been permanently closed.¹⁴

1
eCFR. 31 CFR 100.5 – Mutilated Paper Currency
2
Federal Reserve Financial Services. Mutilated Currency Procedures
3
Financial Crimes Enforcement Network. Frequently Asked Questions Regarding the FinCEN Currency Transaction Report
4
Federal Reserve. What Should I Do If I Have Damaged or Mutilated Currency
5
Engraving and Printing. Instructions for Submitting a Request for Examination of Mutilated Currency – BEP Form 5283
6
Engraving and Printing. Mutilated Currency FAQs
7
Engraving and Printing. Mutilated Currency Packing Directions
8
FAQ | USPS. Domestic Claims – The Basics
9
eCFR. 31 CFR 100.7 – Treasury’s Redemption Process
10
eCFR. 31 CFR Part 100, Subpart B – Request for Examination of Mutilated Currency
11
Federal Reserve Financial Services. Handling Counterfeit Currency
12
United States Secret Service. Suspected Counterfeit Note Submission Form
13
Federal Reserve Financial Services. Contaminated Currency and Coin Depositing Procedures
14
U.S. Mint. Products and Coin Programs