Can I legally pay off a debt in pennies or can the payment be refused?

UPDATED: Jul 11, 2011

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Can I legally pay off a debt in pennies or can the payment be refused?

Asked on July 11, 2011 under Bankruptcy Law, Arizona


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

Pennies are still legal tender, as much as people may wish otherwise. They therefore may be used to pay any debt, *unless* the instrument creating the debt, any other agreements between the parties (such as an agreement to settle the debt or schedule payment), etc. either states that pennies may not be used or specifically sets out how the debt must be paid (e.g. by money order). That's because such agreements are completely enforceable and legal. Note also that while a party cannot refuse to accept pennies, other than as per the above, they may be able to then impose on you any costs they incur in accepting the pennies, the same as they could impose on you the cost for a bounced or bad check if you paid initially by one of those; in this case, if they had to use a commercial coin machine to count, etc. the pennies and it takes a portion of the payment as its fees, they could possibly seek to recover that fee from you or consider the debt not paid in full until you pay that fee, too.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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