A lot of shooters have wondered what happens when a bullet is fired vertically. Popular lore includes such mis-ideas as the bullet coming back down at the same velocity as its original muzzle velocity (and probably one that says it disappears in a time warp=).
Even today, the two best references on the subject are still "Hatcher's Notebook", (by Julian S. Hatcher, 3rd edition, Stackpole Books, ISBN: 0811707954) which includes a chapter on bullets fired vertically, and an article titled "Terminal Velocity and Penetration Studies," by Lucien C. Haag, which appeared in Vol 2, No. 1 of Wound Ballistics Review. This information is excerpted from both.
First, it must be understood that recovering vertically fired bullets is difficult because wind causes them to drift from the expected vertical line. (This probably accounts for many of the myths.)
Hatcher's tests indicated that on the average, vertically fired rifle bullets reach about 9000 feet in altitude (slowed from their muzzle velocity by air drag and gravity to zero velocity), taking about 20 seconds to reach maximum height. Then, pulled by gravity, and slowed by air drag they take about 40 or so seconds to return. Bullets fired vertically come back base first.
Why?
Hatcher describes one experiment with the 150gr M2 Ball bullet fired vertically. When it came back from vertical (round trip time was about 42.9 seconds) it left only a 1/16 inch dent in a soft pine board that it happened to hit. (Not exactly what it would do at 2700f/s, eh?) Based upon this and similar tests Hatcher concluded that the impact velocity was about 300 f/s, which from additional testing appears to be the terminal velocity (the maximum free fall velocity which is limited by air drag on the body in question) of that bullet falling from any height in the atmosphere. (If I remember correctly from my limited parachuting experience the terminal velocity of a falling person is somewhere around 130 mph or about 200 f/s.)
What does not substantially change, even at extreme range, is the rotational speed of the bullet that was imparted by the rifling (around 300k rpm) since the effect of air drag on the rotational velocity in negligible. Thus the gyroscopic action, once the projectile is stabilized, tends to keep the bullet oriented in the same direction, thus the base first (well ok, original position trailing end) return. It is interesting that this was not commonly known until just before WWII. The British had lots of dud antiaircraft rounds that all came back base down, or more correctly oriented to the same elevation as shot from the gun. BTW, this is what raises hob with traditional long range small arms ballistics. With lots of elevation on the bore (past 2,000+ or so yards) at the far end the bullet is actually falling sideways and all frontal air drag algorithms are out the window.