No pennies, no problem: Here's how NJ cash rounding rules will work
The Brief
New Jersey businesses have the option to round final cash transaction totals to accommodate the federal phaseout of the penny.
This rule strictly applies to physical cash, exempting payments like credit cards, debit cards, and checks from being rounded.
Businesses who adopt the system but improperly round up a customer's total face progressive civil penalties.
NEW JERSEY - With the federal government officially halting the production of pennies in November 2025, New Jersey has taken steps to prepare the local economy for a phaseout of the one-cent coin.
What we know
The bill, which was first introduced this past June, establishes clear rounding guidelines for businesses choosing to adapt their cash transaction processes.
By providing standardized rules, the legislation aims to ensure clarity and fairness for both businesses and consumers as physical pennies become less common.
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How cash rounding works
By the numbers
For businesses opting into the rounding system, the adjustments are applied strictly to the final cash transaction total, after all taxes, discounts, fees, and other adjustments have been calculated. The bill outlines a precise formula for adjusting cash payments to the nearest multiple of five cents:
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Rounding down: Final cash transaction totals ending in one, two, six or seven cents must be rounded down.
Rounding up: Final cash transaction totals ending in three, four, eight or nine cents must be rounded up.
These rounding rules apply exclusively to physical cash payments. Purchases made using a credit card, debit card, check, wire transfer, or any other noncash payment method are entirely exempt from rounding and will continue to be charged down to the exact cent.
Consumer protections and enforcement
Why you should care
The bill includes explicit guardrails to protect shoppers from unfair practices. While businesses are permitted to round up transactions, any business that adopts the policy but improperly rounds up a customer’s bill in violation of the rules faces significant financial penalties:
First offense: $1,000 fine.
Second offense: $2,500 fine.
Subsequent offenses: A $5,000 fine for the third and each following violation, with each day the violation occurs constituting a separate offense.
The legislation also preserves the ability of businesses to run charitable donation programs, inviting customers to round their purchases up as a donation.
What's next
The proposed law passed a committee vote with overwhelming support last week and is moving forward in the legislative process. If signed into law, the act takes effect 30 days after enactment.
The Source
Information from this article was sourced from New Jersey legislation Assembly Bill No. 5233.
