Legal Tender Notes
First issued during the Civil War in 1862, Legal Tender Notes, backed by the credit of the U.S. government, were initially used to fund the Union effort in the Civil War. Initially these notes circulated at a discount relative to their face value, in comparison with gold and silver coin. After 1878, they circulated at parity with coinage. Large-size issues were produced through the late 1920’s, with small-size notes introduced in the Series of 1928.
Small-size red seal denominations include $1, $2, $5 and $100 notes. Popular notes include the one-off Series of 1928 $1 (primarily released to circulate in Puerto Rico, and not until the late 1940's), along with the Series of 1966 $100 notes, the only small-size Legal Tender $100 issue. The $2 and $5 red seals from Series 1928, 1953 and 1963 are still commonly found in old hoards, with most circulated notes having only a modest premium over their face value.