Does the Federal Reserve produce bank notes and coins?
No, the Federal Reserve does not produce bank notes or
coins. The Bureau of Engraving and Printing
produces currency and stamps, and the U.S.
produces our nation's coins.
The Federal Reserve issues Federal Reserve notes and
them in circulation.
How long is the life span of U.S. paper money?
$ 1 ................. 5.9 years
$ 5 ................. 4.9 years
$ 10................ 4.2 years
$ 20 ............... 7.7 years
$ 50 ............... 3.7 years
$100 ............... 15 years
Is U.S. currency legal tender for all debts?
According to the "Legal Tender Statute"
(section 5103 of title 31 of the U.S. Code), "United
States coins and currency (including Federal Reserve notes
and circulating notes of Federal Reserve banks and
banks) are legal tender for all debts, public charges,
taxes, and dues." This means that all U.S. money, as
identified above, when tendered to a creditor legally
satisfies a debt to the extent of the amount (face value)
However, no federal law mandates that a person or an
organization must accept currency or coins as payment for
goods or services not yet provided. For example, a bus
line may prohibit payment of fares in pennies or dollar
Some movie theaters, convenience stores and gas
as a matter of policy may refuse to accept currency of a
large denomination, such as notes above $20, and as long
notice is posted and a transaction giving rise to a debt
has not already been completed, these organizations have
not violated the legal tender law.
What are U.S. notes, and how do they differ from Federal
U.S. notes, the first national currency, began
circulating during the civil war; they were authorized by
the Legal Tender Act of 1862. The Department of the
Treasury issued these notes directly. Issuance was subject
to limitations; the Congress established a statutory
limitation of $300 million on the amount of U.S. notes
outstanding and in circulation. Although this amount was
significant in Civil War days, it is a very small fraction
of the total currency now in circulation in the United
U.S. notes serve no function that is not already served
by Federal Reserve notes. As a result, the Treasury
Department stopped issuing U.S. notes, and none have been
placed into circulation since January 21, 1971. Those
remain in circulation are obligations of the U.S.
The Federal Reserve Act of 1913 authorized the
production and circulation of Federal Reserve notes.
Although printed by the Bureau of Engraving and Printing
(BEP), these notes move into circulation through the
Federal Reserve System. They are obligations of both the
Federal Reserve System and the U.S. government.
Both U.S. notes and Federal Reserve notes are part of
our national currency and are legal tender. They circulate
as money in the same way.
Are national bank notes still accepted as currency, or are
they only collector's items?
Yes, any national bank notes still in circulation are
tender at face value as a matter of law. National bank
notes were issued from 1863 to 1935. They are probably
worth more than face value to currency collectors,
because they are very rare.
How can I find out how much a specific bill is worth?
If you believe that a bill may be worth more than its face
value, you should consult a currency collector or dealer.
How are coins and currency put into circulation?
Coins and currency are placed into circulation through
depository institutions, which obtain coins and currency
from their Reserve Banks. The Federal Reserve, the Bureau
of Engraving and Printing (BEP), and the U.S. Mint do not
provide coins and currency directly to the public for
How can I determine if a note is counterfeit?
The U.S. Secret Service's web site provides detailed information
about detecting counterfeiting.
What was the largest denomination ever issued, and whose
picture was on it?
The largest note ever printed by the Bureau of Engraving
and Printing was the $100,000 gold certificate, series
1934, featuring Woodrow Wilson. This series was issued
only to Federal Reserve Banks against an equal amount of
gold bullion held by the Department of the Treasury for
certain credits established between the Treasurer of the
United States and the Federal Reserve Banks.
How is U.S. currency destroyed when it is removed from
Currency processing and authentication machines at Federal
Reserve Bank cash offices determine whether the currency
received from circulation is genuine and fit for
recirculation. If a note is genuine but too worn for
recirculation, the note is shredded. The shredded notes
are sent to landfills or packaged and provided as
to the public during tours of the Federal Reserve Banks.
How can I obtain a supply of shredded currency?
Federal Reserve Banks may distribute small packages of
currency residue to visitors and other members of the
public in connection with Bank tours and other
informational and public relations programs. For larger
How can I safely clean old coins?
Ordinary coins, if they are in reasonably good
condition, may be freshened by rubbing them with
cheesecloth or cotton that has been moistened with a paste
consisting of baking soda and a few drops of water. Once
coin has been tarnished, there is no way to completely
restore it to newly minted luster.
The condition of a coin is an important aspect in
determining its value as a collector's item. The finish
could be inadvertently destroyed, or seriously affected
the indiscriminate use of a cleaning agent. If you
that you have coins that are, or could be, of numismatic
value, you should seek advice from a coin dealer or
collector regarding methods currently being used to clean
What portraits are shown on U.S. coins?
United States coins currently in circulation have the
- Abraham Lincoln on the one-cent coin
- Thomas Jefferson on the nickel
- Franklin D. Roosevelt on the dime
- George Washington on the quarter
- John F. Kennedy on the half-dollar coin
In the past 30 years there have been 3 one-dollar
coins. The Eisenhower dollar was produced from 1971 -
1978; the Susan B. Anthony dollar was produced from 1979 -
1980, then again in 1999; and a new one-dollar coin bearing
the portrait of Sacagewea and her infant son was released
Where can I purchase sheets of uncut money?
You can purchase money from the Bureau of Engraving and
Where can I find information on the new currency note
features? Why is it being changed?
Information about new currency note features is available
on the Bureau of Engraving and Printing web
When was the "In God We Trust" motto adopted?
Congress passed an Act on April 22, 1864 changing the
design of the one-cent coin to include the motto and
authorizing the creating of the two-cent coin. "In
Trust" first appeared on the 1864 two-cent coin.
For more information on the history of the "In God
Trust" motto, go to The U.S. Treasury web
Can I obtain specific coins and currency from a Federal
The Federal Reserve Banks only provide coin and paper
currency directly to depository institutions. You may call
the depository institution you bank with to see if they
will honor your request when they order currency or coin.
What are paper notes made of and which company manufactures the paper for the U.S. notes?
All U.S. notes are made of 75 percent cotton and 25
percent linen. This special paper is made by the Crane
Company, Dalton, MA, which created it for the Treasury in
1879 and holds the patent.
Can the U.S. government use the security thread or machine-
readable features to track currency or detect it remotely?
No, the machine features are intended for authentication
purposes only; they will not set off metal detectors or
similar devices. Individual bills are not traceable to
How can I determine the value of an old coin or note?
The Federal Reserve does not render opinions concerning
the numismatic value of notes or coins. There are two good
sources of information on this subject. First, public
libraries have books with the values of old coins and
notes. Alternatively, if you'd like to have the item
appraised, you may contact several currency dealers and
collectors. Listings are available in the telephone
directory under the headings of CURRENCY and HOBBIES.
Also, to obtain a list of local dealers, you may contact
the American Numismatic Society
by calling (212)571-4470 or visiting its website
To determine the numismatic value of notes or coins,
currency dealers may consider the condition, series date,
denomination, production totals, and other factors.
Grading is not an exact science; it is possible to have
the same item appraised at different values.
What does the "$" sign mean, and where did it originate?
The origin of the "$"sign has been variously
accounted for, but the most widely accepted explanation is
that the symbol is the result of an evolution of the
Mexican or Spanish "P's" for pesos, or piastres,
or pieces of eight. The theory, derived from a study of
old manuscripts, is that the "S" gradually came
to be written over the "P", developing a close
equivalent of the "$" mark. It was widely used
before the adoption of the United States dollar in 1785.
For more information about the U.S. paper currency,
visit the Bureau
of Engraving and Printing web site
Do you have any resources that would help me
teach about money in my classroom?
Visit the Federal Reserve's educational website, Fed
, for resources for educators,
students, parents, and the general public.
Who is in the painting on the back of the $2 bill?
The image on the back of the $2 bill is that of
The Signing of the Declaration of Independence by John
Turnbull, which currently hangs in the Rotunda of the
Capitol building. The painting features the committee that
drafted the Declaration of Independence--John Adams,
Roger Sherman, Thomas Jefferson presenting the document,
and Benjamin Franklin--standing before John Hancock, the
President of the Continental Congress. The painting
includes portraits of 42 of the 56 signers and 5 other
Is it okay to continue to use the older federal reserve notes when newly designed bills are in circulation?
Yes, you can continue to use older federal reserve notes.
It is not necessary to trade in your old-design notes for
new ones. All U.S. currency remains legal tender,
regardless of when it was issued.
Is it against the law to write on dollar bills?
According to "Money Facts," at the Bureau of
Engraving and Printing's website, the "defacement of
currency is a violation of Title 18, Section 333 of the
United States Code. Under this provision, currency
defacement is generally defined as follows: Whoever
mutilates, cuts, disfigures, perforates, unites or cements
together, or does any other thing to any bank bill, draft,
other evidence of debt issued by any national banking
association, Federal Reserve Bank, or Federal Reserve
System, with intent to render such item(s) unfit to be
reissued, shall be fined not more than $100 or
imprisoned not more than six months, or both.
Defacement of currency in such a way that it is made unfit
for circulation comes under the jurisdiction of the United
States Secret Service. Their mailing address is:
United States Secret Service
950 H Street, NW
Washington, DC 20223
Where can I find information on coin and currency collecting?
The Federal Reserve does not provide information on
currency or coin collecting. You may find such information
in your telephone directory or on the Internet
under "currency and coin collectors."
The Bureau of Engraving
, a bureau of the
United States Department of Treasury, provides fact sheets
for currency collectors as well as other basic information
about United States currency.
The United States Mint
, also a bureau of
the United States
Treasury, provides basic information on United States
What is the significance of the pyramid on the back of a
one dollar bill?
The pyramid is part of the Great Seal of the United States
and is a symbol of material strength and endurance. The
pyramid is unfinished, symbolizing a striving toward
growth and a goal of perfection. Above the pyramid a
glory, with an eye inside a triangle, represents the
eternal eye of God and places the spiritual above the
material. At the top edge is the 13-letter Latin motto
Annuit Coeptis, meaning "He has favored our
undertakings." The base of the pyramid bears the
roman numerals MDCCLXXVI (1776). Below is the motto Novus
Ordo Seclorum, "a new order of the ages."
When did the United States go off the gold standard?
H.J. Res. 192, approved by President Roosevelt on June 5,
1933, provided that obligations payable in gold or
specific coin or currency are contrary to public policy,
and that those obligations could be discharged dollar for
dollar in legal tender. After that resolution was
adopted, currency of the United States could not be
converted into gold by United States citizens, but the
Treasury would convert dollars into gold for foreign
governments as a means of maintaining stability and
confidence in the dollar. Because the dollar was no
longer freely convertible, one could consider that the
United States was no longer on the gold standard at that
time. If, however, one considers the gold standard as a
monetary system in which the unit of money is backed by
gold even if the monetary unit cannot be converted into
gold, one could argue that the United States went off of
the gold standard on August 15, 1971 when President Nixon
announced that the U.S. dollar would no longer be
convertible into gold in the international markets. The
President was able to suspend the ability to convert the
dollar into gold because there was no legal requirement
that the United States exchange gold for dollars. On
December 18, 1971 the President devalued the dollar, and
even though the devaluation was effective immediately,
only Congress could officially change the gold value of
the dollar. Early in 1972, Congress passed Public Law 92-
268, which gave formal approval to the December 1971