how can a business refuse to take a $100 bill?

Geoman · January 20, 2003 11:43AM

I have always wondered how a business can state "We do not accept $100 bills".

I realize (being a restaurant manager for 7 years) that there is a chance you could receive a counterfiet bill. And that the chances are greater for the higher denominations. BUT, I believe that any of the US bills are considered "legal tender for all debts..." or at least that is what I have read. So, how can they refused to take it, leagally?

Just curious, as I don't have a personal vendetta out against someone.

JMOORE · January 20, 2003 11:46AM

Having worked in retail for over 25 years I can say one of the reasons is security.

Many "small" stores don't like to have them in the cash drawer and don't like to make change for them.

dbldie55 · January 20, 2003 11:46AM

Many will not keep enough change on hand for such bills. The staff has to deposit the money into a safe every time they get a certain amount. Has nothing to do with counterfeits.

Russ · January 20, 2003 11:47AM

There is no law that says a business has to take a $100 bill, or any bill for that matter. The words "for all debts public and private" have no legal status at a private business. That's just a very common misconception.

Russ, NCNE

Geoman · January 20, 2003 11:48AM

Two good points, and I agree with them both.

But is it legal to do this? Since they are suppose to be accepted for "...all debts..."

I guess I must be remebering something wrong. For some reason, I have in my mind that somewhere it is written that the US Currency/US Coins "..are accepted for all debts..." incurred.

Sorry!

ccr · January 20, 2003 11:54AM

Security/Insurence reasons? I don`t think gas stations or 7-11 type places have alot because of the high risk of robbery that they obvious attract. Also I would think Insurence companies tell them how much to have on hand. At least I would they would be insured against that kind of thing.

Russ · January 20, 2003 11:54AM

<< it is written that the US Currency/US Coins "..are accepted for all debts..." incurred. >>

You have incurred no debt until a transaction is completed. If a business chooses not to accept a $100 bill, obviously the transaction was not completed.

Russ, NCNE

Geoman · January 20, 2003 12:01PM

Guess I learned my lesson.

Sorry.

Here is a quick story for everyone.

I'll run before I embarrass myself anymore...........

Russ · January 20, 2003 12:02PM

I love that Taco Bell story! I have that in my bookmarks.

Russ, NCNE

Catch22 · January 20, 2003 12:23PM

Not really on topic, but kinda funny never-the-less.
My wife works for Bank of America. Not long ago she had a lady come in with a few Morgans and Peace dollars. The lady wanted to exchange them for bills. My wife had to ask her Manager if the coins were real!? She had never seen one before and thought she was being scammed. The Manager informed the lady that the coins were worth more than face value and recommended she sell them at a coin store. The lady declined and said she simply wanted to exchange them for bills.

I've always heard stories like this and never believed them. Well, I can testify that it does happen.
As you can probably guess, my wife totally ignores my coin hobby. The coins, common circs. My wife took them to a local dealer and got 5 bucks apiece and went shopping...

smprfi · January 20, 2003 12:47PM

<< 

<< it is written that the US Currency/US Coins "..are accepted for all debts..." incurred. >>

You have incurred no debt until a transaction is completed. If a business chooses not to accept a $100 bill, obviously the transaction was not completed.

Russ, NCNE >>

Eat something your buying. You have now incurred debt.

Russ · January 20, 2003 12:51PM

smprfi,

Good point, but it still would not make the establishment with a policy precluding the acceptance of large bills legally obligated to take it as payment.

Russ, NCNE

CLASSICS · January 20, 2003 1:04PM

yea! just wait until they come out with the new colored twenty dollar bills..i can just see it now, iam sorry..we do not accept foreign currency. a saw a bus driver who woulnt take a sac dollar, said he wasnt allowed to take any money from europe.

GDJMSP · January 20, 2003 1:04PM

Russ has the right idea - no one is required by law ( except the govt. ) to accept any coin or currency. But the phrase " debts, public and private " was eliminated from the US Code back in 1965. The law now reads -

Sec. 5103. - Legal tender

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

smprfi · January 20, 2003 1:11PM

"for all debts public and private"
This is where I disagree with you.It may be a private business,most businesses are.There are few public business.
Private is made in reference to your property were not just anyone can walk in.
Public means any person can walk in off the street.
A store is a public business.

They can refuse to sell to you,but the moment they ring it up they have agreed to the terms of the U.S. currency system.This makes them obligated to take your money.

JJacks · January 20, 2003 1:20PM

I heard once (don't know any facts about it) that someone protested their tax bill by paying the IRS in tens or hundreds of thousands of pennies brought into an IRS office. Was this legal? Yes, but they were charged large "counting" and "handling" fees by the IRS! You just can't beat the IRS, can you!?

< Disclaimer : I remember this story from years ago - don't know if it's true, etc. >

JJacks

smprfi · January 20, 2003 1:21PM

I got this off the U.S. Department of the Treasury web site.

Legal Tender: A Definition

Section 102 of the Coinage Act of 1965 (Title 31 United States Code, Section 392) provides in part:

" All coins and currencies of the United States, regardless of when coined or issued, shall be legal tender for all debts, public and private, public charges, taxes, duties and dues."

This statute means that you have made a valid and legal offer of payment of your debt when you tender United States currency to your creditor. However, there is no Federal statute which mandates that private businesses must accept cash as a form of payment. Private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise.

So the key here is a policy.Do they take cash or do they require some other form of payment.

Russ · January 21, 2003 1:17AM

<< So the key here is a policy. Do they take cash or do they require some other form of payment. >>

smprfi,

You seem to have left out the rest of the answer in that FAQ:

<< For example, a bus line may prohibit payment of fares in pennies or dollar bills. In addition, movie theaters, convenience stores and gas stations may refuse to accept large denomination currency (usually notes above $20) as a matter of policy. >>

Note that they specifically cite the type of example we're discussing here. In other words, it does not matter if an establishment takes cash, they can still legally refuse to take certain bills should they choose to establish that policy.

Russ, NCNE

dakra · January 21, 2003 2:15AM

I once worked for a store nearby an affluent neighborhood. At this store we started the draws off at $200 which included 4-20's, 4-10's, 4-5's and 60- $1 ... although it would vary at times. I would say approximately once a month some butthead would come in and buy a $1.99 item and hand me a $100 bill Okay, I can change that but it leaves me rather short on the bigger bills. Well.. wouldn't you know it, another butthead comes in to buy an item for $1 and hands me a $100 bill. (I have to give you all singles sir/madam)

I think businesses refuse them for the above reason. I mean, if you buy merchandise for $60-$70-$80.. then I would definately complain if they didn't want to take my $100 bill.

Of course... then there were those who wanted to write a check or use a credit card for an item under $2...

I loved the customer who returned a 10 year old Hair Dryer in a brand new box...
and then the customer who returned 5 year old film stating he had bought it the other day....
oh gosh, then the guy who didn't speak English trying to pay for a $24 dollar item with $3.76...

Getting off topic but...those were the days

-Dave

smprfi · January 21, 2003 1:07PM

Russ I didn't leave it out.I looked under definitions and copied what i found. Didn't think of looking at FAQ.
So now that you point it out I would agree with you.

GDJMSP · January 21, 2003 1:21PM

smprfi -

The current US Code is -

TITLE 31 > SUBTITLE IV > CHAPTER 51 > SUBCHAPTER I > Sec. 5103.

Sec. 5103. - Legal tender

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

The statute you listed has been revised as follows below. When you look up US Code - you sometimes need to click on the NOTES to find revisions.

Revised Section Source (U.S. Code)
Source (Statutes at Large)
5103 31:392. 31:456. July 23, 1965, Pub. L. 89-81, Sec. 102, 79 Stat. 255. R.S. Sec. 3584.

The words ''All . . . regardless of when coined or issued'' are omitted as unnecessary because of the restatement. The word ''debts'' is substituted for ''debts, public and private'' to eliminate unnecessary words. The words ''public charges, taxes, duties, and dues'' are omitted as included in ''debts''

It may be found here
Notes on Revisions

how can a business refuse to take a $100 bill?

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