Are Pennies Still Legal Tender? Last Penny Minted

Yes, pennies remain legal tender indefinitely under 31 U.S.C. § 5103, which states that “United States coins and currency are legal tender for all debts, public charges, taxes, and dues.” The U.S. Mint struck its final circulating penny on November 12, 2025, ending 232 years of production, but approximately 240-250 billion pennies still in circulation retain their legal status. Only Congress can revoke a coin’s legal tender designation—the Treasury Department’s decision to stop minting pennies does not change their validity as currency.

U.S. Treasurer Brandon Beach confirmed at the final penny ceremony: “We’re saying goodbye to the penny today, but let me just be crystal clear, like I said, it’s still legal tender.”

The discontinuation creates immediate practical complications for consumers and retailers navigating transaction rounding, business acceptance policies, and conflicting state laws about cash payments—all while pennies maintain full legal status.

Breaking: The Last Penny Was Just Minted

The U.S. Mint struck the final 1-cent coin that will be used as legal tender on Wednesday, November 12, 2025, at its Philadelphia facility, where Treasury Secretary Scott Bessent and Treasurer Brandon Beach witnessed the historic final strike.

President Donald Trump ordered the halt in February 2025, stating “For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!”

The decision followed years of debate: in 2024, the U.S. Mint produced 3.2 billion pennies at a cost of 3.69 cents per penny, resulting in an annual loss to taxpayers of $85.3 million. The Treasury Department expects to save $56 million annually by ending production.

The Mint will continue producing limited quantities of collector pennies, but no new circulating pennies will enter the economy after early 2026 once the final blanks are exhausted.

What Federal Law Says About Penny Legal Tender Status

The legal framework governing penny legal tender status centers on 31 U.S.C. § 5103, the federal statute defining legal tender in the United States.

Full Text of 31 U.S.C. § 5103: “United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues. Foreign gold or silver coins are not legal tender for debts.”

Critical Legal Distinction: Under 31 U.S.C. § 5103, all U.S. coins and currency remain legal tender for debts, public charges, taxes, and dues. Ending production doesn’t automatically revoke the penny’s status—only Congress can do that.

Are Pennies Still Legal Tender? Breaking, Last Penny Minted—What You Need to Know

The statute establishes four key categories where legal tender must be accepted:

Debts: Financial obligations already incurred (loans, overdue bills, contractual obligations)
Public charges: Fees owed to government entities
Taxes: Federal, state, and local tax obligations
Dues: Membership fees, assessments, and similar obligations

This means pennies must be recognized as valid payment for existing debts and government obligations, but the statute contains crucial limitations on when businesses must accept them.

Are Businesses Required to Accept Pennies?

The answer is more complicated than most consumers realize, creating confusion as penny supplies dwindle.

Federal Law Does Not Require Private Business Acceptance: While U.S. currency is legal tender, businesses are not obligated to accept cash for goods and services. Courts have upheld policies such as “card-only” transactions, particularly in industries where digital payments are more efficient.

The Debt vs. Transaction Distinction: A “debt” refers to an obligation already incurred, such as a loan repayment or overdue bill. This distinction is crucial because businesses are not required to accept cash for transactions that do not involve pre-existing debts. For example, a store may refuse cash payments at the point of sale, as no debt has been created. However, once a debt exists, the creditor must accept U.S. currency as valid payment.

State and Local Laws Create Exceptions: Some states and municipalities, including New Jersey, Massachusetts, San Francisco, and New York, require businesses to accept cash to ensure accessibility for unbanked consumers.

Current Business Practices: Some retailers voiced concerns in recent weeks as supplies ran low and the end of production drew near. They said the phase-out was abrupt and came with no government guidance on how to handle transactions. Some rounded prices down to avoid shortchanging shoppers. Others pleaded with customers to bring exact change. The more creative among them gave out prizes, such as a free drink, in exchange for a pile of pennies.

Major retailers including Home Depot, Kroger, Walmart, and McDonald’s have experienced penny shortages in recent months, prompting various adaptation strategies.

The Legal Chaos: Rounding Rules and Consumer Protection Laws

The penny’s discontinuation has created what legal experts call a “minefield” of conflicting regulations around transaction rounding.

The Core Problem: “Traditional rounding might violate consumer-protection laws, including cash-discounting statutes and USDA SNAP rules,” explained Holland & Knight LLP in an October 2025 bulletin on retail compliance. If a store rounds $4.97 up to $5.00 for cash customers, but not for those paying by card, it could be accused of unfair pricing or discrimination.

State Law Complications: Several states including Delaware, Connecticut, Michigan, and Oregon require merchants to provide exact change by law. Meanwhile, the federal food assistance program SNAP mandates that recipients can’t be charged more than other customers.

How Rounding Works Legally: While no North Carolina statute expressly authorizes rounding, a court would likely analyze it as a method for managing how cash is handled, not as a violation of the legal tender law. The key is that rounding adjusts only the physical cash exchanged. It does not change the amount owed or the amount credited to the payer’s account. The full billed amount, including cents, must always be recorded in the receipting system.

Recommended Rounding Methods: Businesses implementing rounding should consider:

Rounding down only: Absorb small losses to avoid discrimination claims
Symmetric rounding: Round to nearest nickel (amounts ending in 1-2 round down, 3-4 round up)
Apply uniformly: Use identical rounding for cash and SNAP transactions
Disclose clearly: Post rounding policies at point of sale
Document everything: Maintain records showing pre-rounding amounts

SNAP Compliance Issues: Federal regulations prevent SNAP participants from being treated differently than cash-paying customers: “[SNAP] Coupons shall be accepted for eligible foods at the same prices and on the same terms and conditions applicable to cash purchases of the same foods at the same store… No retail food store may single out coupon users for special treatment in any way.”

Retailers rounding cash prices must apply identical rounding to SNAP transactions to avoid violating federal assistance program regulations.

What Happens to Government Payments and Tax Obligations?

The situation becomes more complex when dealing with government entities, where legal tender obligations are strongest.

Government Must Accept Legal Tender: Federal law, at 31 U.S.C. § 5103, states that United States coins and currency are “legal tender for all debts, public charges, taxes, and dues.” Most payments to a local government fall into one or more of these categories. Utility bills, permit fees, fines, service charges, contractual invoices, special assessments, system development fees, and taxes are typically fixed obligations set by law, ordinance, or contract.

Administrative Flexibility: However, the federal statute does not specify how a local government must handle payments in every situation. It identifies coins and currency as lawful legal tender, but it does not necessarily require a local unit to accept cash for every type of obligation or at every location where payment might be offered.

Case Law Precedent: In In re Burrell, 482 B.R. 603 (Bankr. D. Idaho 2012), the court upheld a bankruptcy trustee’s policy requiring plan payments by certified funds, wage withholding, or electronic transfer. The debtor argued that the trustee was required to accept physical cash under 31 U.S.C. § 5103. The court disagreed and explained that the statute provides that U.S. currency is legal tender, but it does not require a payee to accept every form of currency in every circumstance so long as the debtor still has a meaningful way to satisfy the obligation in lawful money.

Government entities can impose reasonable payment requirements (like requiring checks for large amounts) but must provide meaningful ways to pay obligations in legal tender.

Practical Implications: What Cash Shortage Means Today

If you pay cash, you’ll start to notice changes almost immediately. Retailers are beginning to round totals to the nearest five cents, a method already used in Canada, Australia, and New Zealand. Some stores are rounding down, absorbing small losses to stay consumer-friendly. Others are rounding up, sparking online backlash and potential legal risk.

For Consumers:

Pennies in your possession remain valid currency indefinitely
Expect rounding at cash registers, but amounts should be disclosed
Card payments will continue charging exact amounts
Ask for pre-rounding prices on receipts if concerned
The Federal Reserve projects the shift will cost or benefit households by mere pennies per year—about five cents annually per family

For Businesses:

Banks have begun rationing penny supplies
Point-of-sale systems need updating for rounding
Legal guidance needed before implementing rounding policies
Risk of legal challenges if rounding applied inconsistently
Jeff Lenard of the National Association of Convenience Stores said last month: “We have been advocating abolition of the penny for 30 years. But this is not the way we wanted it to go.”

The Digital Payment Factor: According to a 2025 Federal Reserve study, cash transactions in 2024 dropped to only 14% of transactions. Persons aged 55 and older used cash for 19% of transactions, while those aged 18–24 used cash for only 10%.

The declining use of cash reduces the practical impact of penny discontinuation for most consumers, but creates access issues for the unbanked population.

Common Misconceptions About Penny Legal Tender Status

Misconception #1: Pennies are no longer valid currency Reality: Pennies remain legal tender indefinitely under 31 U.S.C. § 5103. Production ended, but existing coins retain full legal status.

Misconception #2: Businesses must accept pennies for all transactions Reality: Federal law only requires acceptance for debts, not point-of-sale transactions. Private businesses can refuse cash unless state/local laws mandate otherwise.

Misconception #3: You must accept pennies in unlimited quantities Reality: Pennies are not accepted by most vending machines, or by most toll booths, and are generally not accepted in bulk. Businesses can set reasonable limits on payment methods.

Misconception #4: Rounding is always legal Reality: Rounding rules vary by state and can violate consumer protection laws if applied inconsistently to cash versus card payments.

Misconception #5: Stockpiling pennies will increase their value Reality: Unless you have a rare penny, your one-cent coins are likely still only worth one cent. However, certain rare pennies (1909-S VDB, 1943 copper-alloy, 1955 doubled-die) can sell for thousands or millions at auction.

The Proposed Common Cents Act: Federal Rounding Legislation

On April 30, 2025, Representatives Lisa McClain (R-MI) and Robert Garcia (D-CA) introduced the Common Cents Act, a bill to formalize an end to penny production and require cash transactions to be rounded to the nearest nickel.

What the Common Cents Act Would Do:

Officially authorize penny production cessation
Create uniform national rounding standards
Eliminate conflicting state-by-state requirements
Provide legal clarity for retailers and consumers

Current Status: The bill remains pending in Congress. Retail trade groups like the National Association of Convenience Stores (NACS) have already written to Congress demanding emergency legislation. Without it, well-intentioned rounding could become a legal minefield.

Until federal legislation passes, businesses must navigate a patchwork of state laws, consumer protection statutes, and federal assistance program requirements when implementing rounding policies.

How Other Countries Handled Penny Elimination

When Canada discontinued production of its penny in 2013, retailers generally rounded all prices to the nearest 5 cents, and the economic impact of that rounding has been shown to be negligible in the aggregate.

International Precedents:

Canada (2013): Eliminated penny, required symmetric rounding, minimal economic impact
New Zealand: Phased out one and two-cent coins
Australia: Discontinued one and two-cent coins
Finland, Ireland and the Netherlands have abandoned the use of one- and two-cent coins altogether, with the lowest-value coin in use being the five-cent coin

Key Difference in U.S.: Dylan Jeon, National Retail Federation senior director of government relations, previously told Nexstar that getting rid of the penny in the U.S. is more complicated than when Canada did it roughly 10 years ago, but mimicking their practice of rounding the transaction, post-sales tax, or the change is “the easiest, most standard practice here.”

The U.S. faces unique challenges due to state-level consumer protection laws, SNAP program requirements, and cash-discount statutes that don’t exist in other countries.

Your Consumer Rights Regarding Penny Payments

You Have the Right To:

Use pennies for any payment where legal tender is accepted
Know how your transaction total was rounded
See pre-rounding prices on receipts
Refuse to participate in transactions with unclear rounding policies
File complaints if businesses discriminate based on payment method

Businesses Must:

Apply rounding policies uniformly to avoid discrimination
Disclose rounding practices clearly at point of sale
Accept pennies for debt payments (not point-of-sale purchases)
Comply with state-specific cash acceptance laws
Treat SNAP recipients identically to cash customers

When to Seek Legal Advice:

If charged more for cash than card payments in states prohibiting surcharges
If SNAP benefits rounded differently than cash payments
If business refuses legal tender for existing debts
If government entity won’t accept pennies for taxes or fees
If rounding practices appear discriminatory or inconsistent

What the Penny’s History Tells Us

Officially known as the cent, the first penny was struck in 1787 and had a sundial design that was dreamt up by Benjamin Franklin, one of the Founding Fathers. The U.S. Mint took over penny production in 1793, a year after Congress passed the Coinage Act.

President Abraham Lincoln was the first president to be featured on a coin, starting in 1909, the centennial of his birth. Carl Sandberg wrote at the time, “The common, homely face of ‘Honest Abe’ will look good on the penny, the coin of the common folk from whom he came and to whom he belongs.”

Historical Context: There has never been a coin in circulation in the U.S. worth as little as the penny is worth in 2025. Because of inflation, one nickel in 2025 has parity in value to a penny in 1978, and a dime in 2025 has parity in value to a penny in 1967.

The last coin to be discontinued was the half-cent in 1857, Beach said.

Will Pennies Become Valuable Collectibles?

While the majority of pennies will retain their face value, their discontinuation and enduring legacy may drive interest from coin collectors and enthusiasts. The rarest and most valuable U.S. pennies include historical issues such as the 1909-S VDB Lincoln cent, the 1943 copper-alloy cent, and the 1955 doubled-die penny. These coins are prized for their scarcity and unique production histories and can sell for thousands or even millions of dollars at auction, depending on condition and provenance.

What Makes Pennies Valuable:

Mint errors (double strikes, off-center dies, misprints)
Rare production years
Historical significance
Condition and provenance

The Final Penny: Commemorative pennies bearing the final omega mark will be auctioned, providing collectors with an opportunity to own a piece of American monetary history.

For most Americans, existing pennies will remain worth one cent for everyday transactions, regardless of collector interest.

FAQs About Penny Legal Tender Status

Q: Are pennies still legal tender in 2025?

Yes, pennies remain legal tender indefinitely under 31 U.S.C. § 5103. The U.S. Mint ended production on November 12, 2025, but approximately 240-250 billion existing pennies retain full legal status as valid currency for debts, public charges, taxes, and dues. Only Congress can revoke a coin’s legal tender designation.

Q: Do businesses have to accept pennies for payment?

Not always. Federal law requires acceptance of legal tender for debts, public charges, taxes, and dues—but not for point-of-sale transactions. Businesses can refuse cash payments unless state or local laws mandate cash acceptance. However, once a debt exists, creditors must accept pennies as valid payment.

Q: Is it legal for stores to round cash transactions to the nearest nickel?

It depends on the state. Rounding can violate consumer protection laws if applied inconsistently to cash versus card payments. States like Delaware, Connecticut, Michigan, and Oregon require exact change by law. Businesses should round down uniformly, disclose policies clearly, and apply identical rounding to SNAP transactions to minimize legal risk.

Q: What happens if I owe a debt and want to pay in pennies?

For existing debts, creditors must accept legal tender including pennies. However, some courts have upheld reasonable payment requirements (like limiting bulk coin payments or requiring certified funds for large amounts) as long as debtors have meaningful ways to satisfy obligations in lawful money.

Q: Can government entities refuse pennies for taxes or fees?

Generally no. Government entities must accept legal tender for “public charges, taxes, and dues” under 31 U.S.C. § 5103. However, they can impose reasonable administrative requirements about how payments are made, as long as meaningful payment options in legal tender remain available.

Q: Will my existing pennies lose value or expire?

No. Pennies remain legal tender indefinitely at their face value of one cent. The discontinuation of production does not affect the validity or value of existing coins. Most pennies will continue to be worth one cent unless they have collectible value due to rarity, mint errors, or historical significance.

Q: What should I do with my jar of pennies?

You have several options: (1) Continue spending them at businesses that accept cash, (2) Deposit them at banks that accept coin deposits, (3) Use coin-counting machines (noting service fees), (4) Check for valuable rare pennies before spending, or (5) Hold onto them as legal tender that retains indefinite validity.

What Affected Consumers and Businesses Should Do Now

For Consumers:

Pennies in your possession remain valid legal tender indefinitely
Be prepared for rounding at cash registers when paying with bills
Ask for pre-rounding amounts on receipts if concerned about charges
Know your state’s cash acceptance and rounding laws
Report discriminatory rounding practices to consumer protection agencies
Consider checking old pennies for collectible value before spending

For Businesses:

Review state and local laws regarding cash acceptance and rounding
Develop uniform rounding policies that apply to all cash transactions
Update point-of-sale systems to handle rounding consistently
Post clear disclosures about rounding practices at checkout
Ensure SNAP transactions receive identical treatment to cash payments
Consult legal counsel before implementing rounding policies
Document all rounding procedures for potential legal defense

For Government Entities:

Maintain acceptance of pennies for taxes, fees, and public charges
Consider implementing rounding policies with clear legal authority
Provide alternative payment methods while preserving legal tender access
Document policies to defend against legal tender challenges

“Behind the jokes and nostalgia, this transition raises a fundamental legal question: What does fairness look like when money itself changes? As the U.S. drifts further into digital payments, issues of access, equity, and trust will follow. The penny’s farewell may be small in scale, but it’s a rehearsal for the bigger changes ahead in how Americans define and defend value.”

Disclaimer: This information is for educational purposes only and does not constitute legal advice. Penny legal tender status, transaction rights, and acceptance requirements vary by context and applicable law. Consult official Federal Reserve resources, currency law information, or a qualified attorney for specific guidance regarding penny payment rights or transaction disputes.

Last Updated: November 13, 2025

Sources: Information compiled from 31 U.S.C. § 5103, U.S. Treasury Department statements, Federal Reserve guidance, court decisions, legal analysis from Holland & Knight LLP, and news reports from NBC News, NPR, ABC News, Newsweek, The Hill, and other reputable sources covering the November 12, 2025 final penny production and its legal implications.

About the Author

Sarah Klein, JD, is a licensed attorney and legal content strategist with over 12 years of experience across civil, criminal, family, and regulatory law. At All About Lawyer, she covers a wide range of legal topics — from high-profile lawsuits and courtroom stories to state traffic laws and everyday legal questions — all with a focus on accuracy, clarity, and public understanding.
Her writing blends real legal insight with plain-English explanations, helping readers stay informed and legally aware.
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Are Pennies Still Legal Tender? Breaking, Last Penny Minted—What You Need to Know