So exactly what are the ways in which I can tell a real bill from a fake?? So far, I haven't encountered any fakes that I know of, but I want to be prepared for when I do.
Inspect the quality of printing. Generally, fake dollars will seem flatter and with few details when touched. When making real dollars, it involves printing techniques which are unknown and therefore very hard to replicate. You should look for blurry areas, especially in fine details such as around the borders.
Look at the portrait. There should be certain differences that may show you if the bill is fake.
Portraits in fake bills may seem dull, blurred, and flat, while in real currency, the portraits are sharp and contain fine detailing.
On a real bill, the portrait tends to stand out from the background. On counterfeit bills, the portrait’s coloring tends to blend too much with the bill.
Also, use a magnifying glass to watch the rim of the portrait. There must be written “THE UNITED STATES OF AMERICA” repeated along the sides of the portrait. This will look like a solid line to the naked eye. This feature is especially hard to replicate using office machine copiers or printers due to its size and detail.
Check the serial numbers. There should be two serial numbers located on the face of the bill. Look at the bill carefully and make sure that the serial numbers match. You should check if the the color of the serial numbers on the bill match the color of the Treasury Seal. If they do not match, the bill is likely a fake.
Look for watermarks. Use the day light to see if your bill bears an image of the portrait. It can be seen on all $10, $20, $50, and $100 bills series 1996 and later, and on $5 bills series 1999 and later. The watermark is embedded in the paper to the right of the portrait and should be visible from both sides of the bill.
Now, here is what you can do with the help of some materials:
Apply an UV (black) light to look at security threads. Plastic strips (a vertical line) in high-denomination bills should glow a specific color. The $5 dollar bill should glow blue; the $10 bill should glow orange; the $20 bill should glow green; the $50 bill should glow yellow; the $100 bill should glow pink.