Penny Phase-Out



Pennies Are Phasing Out – What You Need to Know

The U.S. Treasury has announced that pennies will soon be phased out. Pennies will remain legal tender, but as their availability declines, cash transactions may need to be rounded to the nearest nickel. This change affects both individuals and businesses and may have tax reporting implications.

The Federal Reserve and Treasury have provided preliminary guidance, but many details, including the exact method for rounding, are still evolving. We will continue to update this page as new information becomes available.

Background

  • Pennies cost more to produce than their actual value. Discontinuing production saves resources and reduces costs.
  • While pennies remain legal tender, businesses and financial institutions are encouraged to begin preparing for cash rounding.
  • Electronic payments (credit, debit, online) are not affected and will continue to be processed for exact amounts.

Next Steps

  • Review this page regularly for updates.
  • Prepare for potential rounding of cash transactions.
  • Monitor point of sale systems and accounting processes.
  • Contact your accountant, tax advisor, or financial advisor with questions.

We’re here to help you navigate this change. If you have questions, contact us for guidance.



























Frequently Asked Questions

The U.S. Mint struck the final circulating penny on November 12, 2025, officially ending 232 years of penny production. No new pennies will be produced going forward.
Yes. Pennies remain legal tender and can be used in transactions.
The exact rounding method is still being finalized. Cash transactions may be rounded to the nearest nickel, while electronic transactions will continue to be processed exactly. Some retailers have already adopted this rounding approach for cash payments.
No. Credit, debit, and online transactions are not impacted.

Businesses may consider:

  • Updating POS (point-of-sale) systems
  • Determining a rounding approach for cash transactions
  • Providing guidance or training for employees
  • Posting clear signage about the rounding method

Prices do not need to change, and electronic transactions will continue to be processed to the exact cent. Some businesses may also choose to communicate to customers that rounding applies only to cash transactions.

Likely. Both federal and state laws may apply to cash rounding. Guidance is still evolving, and the exact rules are not yet finalized. We recommend contacting your accountant or tax advisor to understand how this may affect your business.
This resource page will be updated as new guidance is provided.