Thursday, August 3, 2017


     As I was writing yesterday's piece about Chicago businesses taking their first baby steps toward cashlessness, I vaguely suspected that refusing to accept currency might be against the law. I doubted it was—so many businesses wouldn't be doing it if it were. But you never know, and it seemed worth checking. I remember a West Side steakhouse owner that was using his waiters to push condos he was selling, which I discovered was illegal in Chicago when I wrote about it.
     Online, it was quick enough work to find references that no federal law exists requiring businesses to accept currency. But the reference I read noted that local laws could still do so. 
     So I called the Chicago law division, and Bill McCaffrey—all hail the city that works!—did some checking, and confirmed what I suspected: no municipal requirements force stores to accept cash money. 
     I mentioned this in the column. But beliefs die hard, and some readers were not satisfied: 
     In reading your column today I was thinking cash and of the signs on the tollway stating that they can only accept $20 bills or smaller. Does this really mean that they will not accept a $50 bill if that is all you have? I’ve always wanted to test that, but rarely have a $50 bill in my pocket and it is much more efficient & cheaper to use my transponder.      
     I’m fairly certain that each piece of US currency states “this note is legal tender for all debts, public and private”. Wouldn’t this, from the Federal government, be the final word?
         Anxiously awaiting your thoughts, 
         Mitch Holleb

     He is correct. There, on all American currency, this bold, all caps declaration: "THIS NOTE IS LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE."
     Does that not mean it can be used to pay for anything?
     In a word, No.
     The question must come up enough that the Treasury Department addresses it directly in a post titled "Legal Tender Status": The key passage is:
This statute means that 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'm not a lawyer, but I think the confusion is due to a misunderstanding over the legal definition of the word "debts." Debt is not merely owing someone money—you don't become a debtor by trying to purchase a $5 vegan brownie from the Goddess and the Baker. Debt is incurred as the result of a contract, or a legal judgment.  That is what you can pay off with any kind of legal American money, and why irked individuals sometimes show up to pay their taxes or fines or whatever with barrels of pennies—a legal if annoying payment—while a grocery store can refuse your hundred, or decline to take folding money at all. 


  1. Just this morning, getting my coffee from 711 ($2.11 for coffee and a doughnut, fellow cheapskates), I heard the clerk tell an obviously regular customer, "No sirve la maquina," pointing to the lottery machine. What do "cashless" stores do when electricity or the internet fails them?


    1. There still are the manual credit card swipers that can be used.

  2. Seems to me, a certain type of business-person could be guilty of discrimination against a person of a certain social class (think homeless) that only has access to cash. Can a potential customer barter their services? Sweep the floor for a sandwich?

    1. If not accepting cash were found to be discriminatory, it would, in fact, be illegal.

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  3. Good question, John!

    Very tangential to the topic... It's interesting to me that the bill pictured is from San Francisco. Does it seem to anybody else that an inordinate number of bills flying around Chicago are "12" "L" notes? I occasionally like to note where the notes come from and, at least in the city, on the north side, there are way more from San Francisco than geography would tend to indicate would be likely...


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