Something like 97% of the US Dollars are not actual printed bills. Do you mean once they are created in a computer ledger or as cloth bills you can hold?
Most are kept in accounts as 0's and 1's. The governments issue bonds that banks and other governments purchase. It is a big circle jerk in other words.
Our "Federal Reserve" buys the bonds for example. Basically, that is the banks that run this tax farm buying their own debt. It is a scam.
Where does it go? It goes from one bank account to another, or the banks sit on it to maintain their solvency (not go broke from bad decisions).
That is what happened in 2008 for example. Our government created a bunch of new currency to bail out a bunch of institutions that had made bad decisions.
They lost their bets, and tax payers paid the losses.