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I'm trying to find out about businesses refusing $50 & $100 bills. Aren't they required by law to accept all legal tender? I had one person say it could be that it's not all legal (i.e. a concern for counterfeit currency) – in that case shouldn't it be the stores responsibility to purchase one of those scanning machines?

  • In Banff, August 2013, a clerk refused my $50 bill and said it was because there was a report of a local counterfeiter. Someone should tell the Canadians about the pens used in the US to detect counterfeit money. Of course, there's a profit to be made at currency exhange offices, so maybe it's not just the fear of counterfeit money. – user10863 Aug 6 '13 at 21:56
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    @user10863 Those pens only work on wood based paper. You can order cotton paper off the Internet or get it at Office Max (people use it for reumes and formal writing all the time), and the pens don't work on it. If I was looking to counterfit money I'd be looking for a retailer that uses pens, probably the easiest target because they're relying on such weak security. – Chris S Oct 9 '14 at 18:05
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I looked this up on Wikipedia, and was hoping the answer would be "no - stores cannot refuse legal tender", but unfortunately, it's not the case! If the retailer wants to go to the lengths of refusing certain denominations to protect themselves from counterfeit currency, they are fully within their rights to do so. The "Legal Tender" page on Wikipedia says this about Canadian bills:

[...] Retailers in Canada may refuse bank notes without breaking the law. According to legal guidelines, the method of payment has to be mutually agreed upon by the parties involved with the transactions. For example, convenience stores may refuse $100 bank notes if they feel that would put them at risk of being counterfeit victims [...]

What is interesting about what I found out, is that legal tender cannot be refused if it is in repayment of an existing debt (i.e. not a store transaction for which there existed no previous debt). So you could offload your $100 bills when repaying your Sears credit card account (or pay in pennies if you wanted to!) and they couldn't refuse you!

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    Think about all of the scenarios of "store". Should a soda machine be compelled to accept $100 bills or $20 legal tender gold coins? – duffbeer703 Sep 8 '10 at 18:18
  • All the vending machines I've seen don't even accept pennies. – Dan B. Jun 12 '11 at 18:57
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    If one eats at a restaurant (thereby creating a "debt" which of course is repaid before leaving the restaurant), then, in the absence of signs prominently displayed saying "No $100 bills accepted", can one pay with a $100 bill and the restaurant cannot refuse to accept it? – Dilip Sarwate Aug 7 '13 at 12:18
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    I don't think it is true that you could pay your Sears card bill in pennies, since the Currency Act sets a limit to the number of each coin type that is considered legal tender. laws-lois.justice.gc.ca/eng/acts/C-52/page-1.html#h-6 In the case of pennies, they would not have to accept more than 25. – James Scriven Mar 5 '14 at 9:20
  • Pennies are no longer legal tender in the US (you can't pay your debt in pennies u less the lender is willing to take them)... and my understanding is that Canadin pennies are no longer even currency, just decorative metal circles (a move which the US should probably copy). – keshlam Sep 18 '15 at 16:11
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The U.S. Treasury said the same thing on the lawfulness of retailers refusing legal tender at point of sale - retailers are allowed to refuse any denomination of U.S. currency:

[...]all United States money as identified above are a valid and legal offer of payment for debts when tendered to a creditor. There is, however, no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services. [...]

  • I assume that includes credit cards? – Daniel Jan 15 '10 at 16:14
  • @Daniel Yes, except if both parties agreed to other terms prior to incurring the debt, as you probably did in the contract you signed to get the credit card (which almost certainly prohibits things like sending $5,000 worth of pennies as payment). – Chris S Oct 9 '14 at 17:55
  • FYI: In the UK, legal tender is: 1p and 2p coins up to 20p, 5p and 10p coins up to £5, 20p and 50p coins up to £10, and everything bigger (£1 coins upwards) is legal tender for any amount. – gnasher729 Feb 13 '16 at 0:47
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Yes, U.S. currency of any denomination is "legal tender FOR ALL DEBTS, public and private." But when you go into a store you (normally) don't owe them anything. In that case, it's more like a barter transaction: Your currency for their soda. Meaning that they can refuse to take "your currency."

Open an account at the store, and run up a debt. Then you can pay in any denomination.

  • My daughter (in a dorm for 4 weeks) just texted me to bring cash. Her roommate has a $100 bill the cafeteria will not accept. I told her to load a tray, take a good bite here and there, and present the bill. Point to "legal tender FOR ALL DEBTS, public and private." Uh, just bring my friend 5 20's. Funny that a visitor from overseas would have gotten 2 $100 bills and not $20s. – JoeTaxpayer Jul 12 at 16:47
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Legal tender is by law any denominations of money printed by the Bank of Canada. There is an exclusion to this in that it must also be acceptable to both parties of the transaction. See the following link from the Bank of Canada on Legal Tender and look at the answer to the question of What is "legal tender"?

The reason retailers may refuse the "legal tender" is in the case of counterfeit prevention. The stores that purchase the scanning machines are trying to be accommodating by deferring the decision to refuse the "legal tender" after verifying it (checking if it is acceptable).

protected by Chris W. Rea Feb 12 '16 at 13:02

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