The bill introduces a new section, 554J.1, which establishes guidelines for rounding cash transactions and payments in Iowa. It specifies that for cash transactions, if the total amount (including taxes) ends with the digits one, two, six, or seven, the seller may round down to the nearest multiple of five cents. Conversely, if the total ends with three, four, eight, or nine, the seller may round up to the nearest multiple of five cents. Additionally, if the total amount is one or two cents, it must be rounded up to five cents.

Importantly, this rounding rule does not apply to transactions made using demand or negotiable instruments, electronic fund transfers, checks, gift cards, money orders, credit cards, or similar payment methods. The bill aims to simplify cash transactions in light of the U.S. Mint's suspension of penny production, which took effect on November 12, 2025.