What year did the US discontinue circulating 500 dollar and 1000 dollar bills?

Answer 1

Circulation of high-denomination bills was never formally halted, but occurred in stages through a "soft" withdrawal.

Printing of $500, $1000, $5000 and $10,000 bills was suspended in 1945 due to low use (all those bills carried a 1934 series date, though). Until 1969 they were handled like any other denomination - it was possible to request them from a bank, you could deposit them, spend them, etc. However the government was increasingly concerned that high-value bills were being used by criminals to easily hide large sums of money. In July of that year President Nixon issued an order that banks could no longer supply high-value bills, and any that were deposited had to be held and returned to the Treasury.

Interestingly, the government never ordered a recall of high-value bills so any that were in circulation at that time remained in use until they were deposited. Over the years the number dropped to where they're effectively no longer in circulation. Technically they're are still legal tender but it wouldn't make much sense to spend them because they're worth more to collectors.

Every few years there are proposals to re-introduce larger bills, in part because the purchasing power of a $100 bill is so much less than it was in 1969. But given the widespread use of electronic payments and concerns about terrorist funding, it's unlikely that the US will make bills larger than $100 any time in the near future.