From any reason at all, money can be damaged. after all, it is made out of paper which can be ripped or burned! Money may accidentally be damaged by you, or your pets. No matter what the reason or who does it, you can redeem your damaged money, even it has been burned!
Most countries have policies on procuring damaged money and replacing them. In the US, the Department of Treasury is responsible for replacing damaged money. These are the steps to take if you want to replace your currency which has been accidentally burned, contaminated, or ripped.
Check and Assess the Damage. If your money has been damaged to less than 50 percent, or if your currency is still legible, you can get it exchanged at your local bank. However if the damage exceeds 50 percent of the original, the money is considered mutilated. Such a currency has to be submitted to the US Bureau of Engraving and Printing, or to the US Mint.
Submit the currency if more than half of the paper is intact. The bill should be legible, and the security feature on it should partially (if not fully) be showing. These features include the security ribbon, the security thread, and the bill’s value. Remember to package it in a Zip-loc bag so that more damage to it is avoided.
Write a letter of explanation. When sending the money for replacement, you have to give an explanation of how it was damaged. Mention the value of the money, your name and contact information, your bank account and routing number, and your mailing address within this letter.
Hand the currency in person or via mail. If you live in Washington, D.C., you should go to the Bureau yourself and hand deliver the currency and letter. If not, you can mail it through the Postal Service through registered mail with a return receipt requested. The address of the Bureau is:
US Bureau of Engraving & Printing,
P.O. Box 37048,
Washington, DC 20013.
Wait for your the process of the claim for 6 to 36 months. The time period depends on the evaluation of the currency and the Director of the Bureau decides on redeeming the currency claim.