Can you spend a 500 dollar bill?

The US has never withdrawn any currency except Gold Certificates, so technically a $500 bill is still legal tender.

More importantly, though, is WHY would anyone spend one? Depending on its date and condition, the collector value of a $500 bill can be much higher than $500, so spending it would cause you to lose all of that extra value. Far better to sell it to a collector or dealer, spend $500 of what you receive and keep the rest as profit.