Senate Advances Common Cents Act

The Senate recently passed the Common Cents Act (S. 1525), a step toward establishing a clear, consistent federal framework as the U.S. transitions away from the penny. This comes as several states in the region have already enacted their own rounding laws.

The Senate bill would:

• Make cash rounding permissive. Businesses may round cash totals to the nearest five cents, and nothing in the Act may be construed to require anyone to round.
• Codify Treasury's 2025 decision to end production of the penny for general circulation, while allowing continued production of collector coins, and confirms existing pennies remain legal tender.
• Add a Federal Reserve reporting requirement on penny supply and the impact of shortages and rounding on low-income, older, unbanked, and underbanked consumers.
• Give Treasury authority to set a lower-cost 5-cent coin composition.

For credit unions, a uniform federal standard would help reduce uncertainty around cash handling, teller procedures and member transactions.

The House passed a companion bill, H.R. 3074, in July. Because each chamber passed a different bill number, the House must still pass the Senate's S. 1525. Once approved, it would head to President Trump for his signature.

Congressional action comes as rounding laws have been enacted in 20 states, including Maryland and Virginia.

Maryland
Maryland's penny-rounding law took effect in May. When exact change is unavailable, retailers may round either the final cash price or the change due - but not both - to the nearest five cents. Amounts ending in 1, 2, 6 or 7 cents round down; those ending in 3, 4, 8 or 9 cents round up. The law applies only to cash transactions and does not apply when exact change is provided.

Virginia
Virginia's penny-rounding law took effect July 1 and establishes a framework for cash transactions when pennies are unavailable. Rounding applies only to the cash amount paid by the customer, including taxes. Taxes and fees must still be calculated and remitted based on the unrounded transaction amount.