The Senate passed the Common Cents Act, moving Congress closer to formally ending production of pennies for general circulation.
The measure would permit businesses to round cash transactions to the nearest five cents when exact change is unavailable; electronic payments would not be rounded.
Because the Senate bill differs from the version passed by the House, the two chambers must still approve identical language before sending it to the president.
Earlier this year, the U.S. Mint stopped producing new pennies, prompting retailers to get creative in how they deal with customers who pay in cash. Congress is on the verge of setting a national policy that rounds prices to the nearest nickel.
The Senate has passed the Common Cents Act, S. 1525. The bipartisan measure would formally direct the Treasury Department to stop producing one-cent coins for general circulation and establish federal rules for handling cash transactions when pennies aren’t available.
The penny would not disappear overnight. Coins already in circulation would remain legal tender, and the U.S. Mint could continue producing special pennies for collectors.
The bill comes as retailers, banks, and consumers adjust to dwindling penny supplies.
Production of each one-cent coin has long cost the government considerably more than its face value. When Sens. Cynthia Lummis, (R-Wyo.) and Kirsten Gillibrand, (D-N.Y.) introduced the legislation in April 2025, they said the Mint was spending roughly three cents to produce each penny.
More recent estimates have placed the cost closer to four cents.
How rounding would work
Under the Senate-passed bill, a business unable to provide exact change could round the total amount of a cash transaction as follows:
Totals ending in one, two, six, or seven cents could be rounded down.
Totals ending in three, four, eight, or nine cents could be rounded up.
Totals already ending in zero or five cents would remain unchanged.
For example, a cash purchase totaling $12.42 could be reduced to $12.40. A $12.43 purchase could become $12.45.
The calculation would apply to the final amount after taxes, not to the price of each individual item.
The bill permits rounding when exact change is unavailable; it does not require every merchant to round every cash purchase. Businesses could also choose to round in the customer’s favor.
Credit cards, debit cards, checks, gift cards, electronic transfers, and similar payment methods would continue to be charged to the exact cent.
One unusual provision covers extremely small transactions: a cash total of one or two cents could be rounded up to five cents. Cash payments from employers to workers, however, could only be rounded upward if the employer elects not to pay the exact amount.
What it means for consumers
For most shoppers, the financial effect of symmetrical rounding should be small. Some purchases would cost one or two cents more, while others would cost one or two cents less.
But the change could be more noticeable for people who rely heavily on cash, including older adults and consumers who are unbanked or underbanked. Critics have also raised concerns that retailers could adjust prices so transactions are more likely to round upward.
The bill attempts to address those concerns by requiring the Treasury and Federal Reserve to study penny shortages, rounding practices, and the effects on low-income communities, older consumers, and people without full access to banking services. The Federal Reserve would also have to produce a plan for keeping the remaining penny supply moving through the banking system.
Consumers would still be able to spend existing pennies. The measure does not authorize businesses or banks to declare them worthless.
The bill also gives the Treasury authority to test a less expensive nickel made with an inner zinc layer and an outer nickel layer, provided the redesigned coin works in vending machines and other coin-operated equipment.
The bill isn’t law yet
The House passed its version of the Common Cents Act, H.R. 3074, on July 14. Senate passage is another major step, but it does not by itself send the legislation to the White House.
The Senate bill contains an additional provision requiring the Treasury to notify and brief congressional committees before discontinuing other circulating coins. Because that language was not included in the House-passed measure, the chambers have not yet approved precisely the same bill.
The House could take up and pass S.1525 as approved by the Senate, or lawmakers could reconcile the differences through another legislative step. Only after both chambers approve identical text can the measure go to the president for a signature or veto.