Propane canisters, once used, can be difficult to dispose of, since they often contain propane residue and may be subject to a variety of federal and state laws regarding what you do with them. Under no circumstances should you just leave them anywhere, since they can cause environmental and health problems even when empty. You should also avoid dumping them in normal trash cans or dumpsters, where they can pose hazards when the trash is emptied. Fortunately, there are several easy solutions.
The most popular method of dealing with used propane tanks is to exchange them. Most propane dealers offer deals that allow you to send in your tank, where it can be refurbished and re-used. In return, you are sent a new cylinder of propane to use, so be sure to investigate these options before buying any additional propane. Some companies are actually cylinder exchangers that, for a fee, will take your old tank and send you new equipment that you can upgrade to a different tank or system, although they are sometimes restricted by brand or model.
Other companies also work to refurbish old cylinders but specialize in removing them and do not offer exchanges. These companies will come to your house and offer different price schemes, so it possible to find better deals by comparing these pick-ups with the exchange services.
In order for your cylinder to be reused, it will need to have an OPD, or overflow protection device. If your tank does not have one of these devices, you can get it installed at a propane dealer's business if you want to exchange the cylinder, but there are also other options. You may want to consider completely emptying the tank and refilling it yourself with a less dangerous substance, such as compressed air, which has many uses and can be compressed inside most legal propane tanks.
Many municipal recycling depots also accept propane tanks. Although you have to drop the tanks off at these locations, they usually charge a smaller fee than other services or may not charge at all. Be sure to check your town website for recycling depots and information about what they may accept.
If you want to take the cylinder to a scrap yard, then you will need to completely empty it and remove the pressure. Always be sure to take off the pressure valve in an outdoor environment away from any heat or sparks.