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Tax Alert: Common Cents Act Passes Congress, Sets Cash Rounding Rules

ARTICLE | October 15, 2026

Authored by Aprio, LLP


This article was originally published by Aprio on October 14, 2026.

An overview

Congress passed the Common Cents Act (H.R. 10167), which ends the production of pennies for general circulation and creates a federal method for rounding cash transactions to the nearest 5 cents. The U.S. Mint can still produce pennies as collectibles, and existing pennies will remain as legal tender.

The legislation was the result of rising costs to manufacture pennies. At approximately 3.7 cents per coin, each penny cost the government more to make than it was worth.

How do the Common Cents Act cash rounding rules work?

While rounding is optional for now, businesses that choose to round cash totals to the nearest 5 cents would need to:

  • Round totals ending in 1 or 2 cents down to 0 cents
  • Round totals ending in 3 or 4 cents up to 5 cents
  • Round totals ending in 6 to 7 cents down to 5 cents
  • Round totals ending in 8 or 9 cents up to the next 10 cents

These rules apply only to cash transactions. Credit card, check, and other electronic payments still settle for the exact amount.

Does the Common Cents Act override state rounding laws?

Yes, these federal rules override any state or local laws that provided a different rounding method or that banned rounding. Business groups strongly endorsed this legislation as a way to simplify compliance with across state and local jurisdictions.

What should businesses do now?

If you accept cash, review your point-of-sale settings so rounding applies only to cash payments and only after sales tax is calculated. Track rounding adjustments separately to help keep cash drawers and books in balance.

Have questions about how the Common Cents Act could affect your business? Our tax advisors can help you understand what these changes mean for you.

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    • This article was written by Aprio and originally appeared on 2026-10-14. Reprinted with permission from Aprio LLP.
    © 2026 Aprio LLP. All rights reserved. https://www.aprio.com/insights-events/tax-alert-common-cents-act-passes-congress-sets-cash-rounding-rules-ins-article-tax/

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    This publication does not, and is not intended to, provide audit, tax, accounting, financial, investment, or legal advice. Any tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or under any state or local tax law or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Readers should consult a qualified tax advisor before taking any action based on the information herein.

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