Wayne Klinkel tells the Independent Record that his dog Sundance ate the bills while he and his wife were on a road trip to visit their daughter.
Klinkel says he carefully picked through the dog's droppings, and his daughter recovered more when snow melted.
He says he washed the remnants of the bills and taped them together and sent them to the Treasury Department's Bureau of Engraving and Printing with an explanation of what happened.
The bureau's website says an "experienced mutilated currency examiner" will determine if at least 51 percent of a bill is present and eligible for reimbursement. The process can take up to two years.