US raffle rules by state: Legal guidelines for nonprofits and 501(c)3

In the United States (US), each state has its own set of definitions and laws that dictate what is considered a raffle, which organizations are permitted to host a raffle, and what is required to legally host a raffle.

The first raffle you host can be a bit time consuming and probably confusing, but some of the biggest campaigns on Zeffy are raffles.

Raffles raise a lot of money for the nonprofits that host them.

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If you’re feeling impatient, jump right to our raffle rules and regulations by state:

• ‍Nonprofit raffle laws and regulations by state: A-C
• ‍Nonprofit raffle laws and regulations by state: D-I
• ‍Nonprofit raffle laws and regulations by state: K-M
• ‍Nonprofit raffle laws and regulations by state: M-N
• ‍Nonprofit raffle laws and regulations by state: N-O
• ‍Nonprofit raffle laws and regulations by state: P-V
• ‍Nonprofit raffle laws and regulations by state: V-W

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Are raffles in the US legal?

Raffles in the US are regulated at the state level. Most states have created laws, rules, and regulations that outline:

• What type of organizations can host a raffle.
• For what purpose (usually for the greater good).
• What rules and regulations need to be followed.
• How many raffles an organization can host in a year.

For the most part, nonprofit and 501(c)3 organizations can host raffles to raise money for their cause. But, the rules and regulations vary a lot from state to state.

Some states have strict regulations on how raffles can be conducted, including:

• licensing requirements,
• limitations on the value of prizes,
• and record-keeping obligations.

Others—we’re looking at your Texas—have almost no raffle rules or regulations, relying entirely on the honour system.

In the few states where raffles are straight up illegal or heavily regulated, we definitely suggest consulting with your lawyer or local government to understand the specific rules that apply to raffles in your area.

All that to say that, yes, in most cases raffles in the US are legal. But, it's important to check the specific laws in your state before your nonprofit or 501(c)3 organization hosts a raffle.

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Who can host a raffle in the United States?

In 48 of the 50 US states, nonprofits and 501(c)3 organizations can host a raffle. While some states have almost no rules and regulations (Texas), others completely ban raffles (Alabama).

But, the one consistent rule in states that do allow raffles is: only nonprofit and 501(c)3 organizations are permitted to host raffles.

Okay, let’s break these raffle rules and regulations down state by state.

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Nonprofit raffle laws and regulations by state: A-C.

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Nonprofit raffle laws and regulations by state: D-I.

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Nonprofit raffle laws and regulations by state: K-M

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Nonprofit raffle laws and regulations by state: M-N

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Nonprofit raffle laws and regulations by state: N-O

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Nonprofit raffle laws and regulations by state: P-V

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Nonprofit raffle laws and regulations by state: V-W

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Is there a way to host a raffle without registering with the government?

Raffle laws vary from state to state, but there is almost always a way your nonprofit can hold a raffle without a license or permit.

• Some states don’t require nonprofits to have a license or permit at all. (Florida, Maine, Montana, Ohio, Oklahoma, Texas, Vermont, and Wyoming.)
• Most states only require nonprofits to apply for a permit or license if their raffle ticket sales exceed a certain amount of if the prizes awarded are worth more than a certain amount. So, by keeping your raffles small, you can usually fly under the radar.

We’ve come up with a few tips for holding a fundraising raffle without government registration. But, we do recommend looking into your state’s laws on raffles.

• Only hold a nonprofit for a charitable purpose.
• Keep the raffle small and informal.
• Limit the number of tickets sold and the value of the prize. (Under $2,500 is usually a safe bet.)
• Obtain permission from the property owner where the raffle will be held, if required.
• Partner with a registered charitable organization, if possible. (Although, this can require paperwork in some states.)
• Be transparent about the rules of the raffle and how the proceeds will be used.
• Keep accurate records of all ticket sales and expenses and hold on to them for at least three (3) years after the raffle.

How to legally hold a raffle for your nonprofit?

1. Make sure your nonprofit is eligible.

In the US, the states that allow raffles to be held normally only allow them to be held by registered nonprofits or charities with a 501(c)3, etc. status.

It’s worth checking with your local government to make sure your nonprofit qualifies. But, in the states that allow nonprofit and charity organizations to host raffles:

• If your nonprofit has a 501(c)3 status, you are good to go.
• If you are a registered nonprofit in your state, without 501(c)3 statues, most likely good to go—but it’s still worth double checking.

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2. Fill out and submit all the required forms and include any additional information and fees.

There’s not a ton we can add to this section. But, we do recommend reading through the entire application before starting to fill it out. And, if your state has one, read or watch their how-to guide.

It’s also a good idea to reach out to your local government if it’s your first time applying. They might be able to give you a few tips or even help you fill out the application form.

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3. Wait for your confirmation. (Some states can take up to 90 days to grant a raffle license or permit.)

This one is important. The states that require you to have a license or permit to hold a raffle mean it. So, apply for your license or permit well in advance. Most states require 30 days, some 60 days and a few 90 days.

Whatever the case, don’t host your raffle until you have your license or permit in hand. (And pay special attention to the number, size, and type of raffle your permit or license allows you to hold.

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4. Host your raffle on an online fundraising platform.

There are quite a few paid fundraising platforms out there that can help you host your raffle:

• Givesmart
• Givebutter
• RallyUp

But, there’s only one, 100% free raffle platform for nonprofits: Zeffy.

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5. Submit your nonprofit’s raffle report after your raffle has ended.

We know, we know. The last thing anyone wants to do is more paperwork. But, most US states require nonprofit organizations that host raffles to submit specific record-keeping forms and keep everything raffle-related for at least 3 years.

Most online raffle platforms will help you track ticket sales, names, addresses, prizes, etc. So, even if your state doesn’t allow online raffle ticket sales, it’s still a good idea to equip yourself with a raffles and lottery platform.

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The difference between raffles, contests, and sweepstakes.

Let’s start off by getting into the similarities between raffles, contests, and sweepstakes.

• They’re all great ways to raise awareness for your nonprofit.
• They all offer the opportunity to win prizes.
• They are all regulated by state, federal, and, sometimes, municipal law.

Alright, now for the differences.

• The biggest one is that raffles are a type of lottery in which prizes are randomly drawn and awarded to people who pay for a chance to win. Sweepstakes cannot be required to pay to enter. Contests fall somewhere in between.
• Another difference is that almost every state limits the types of organizations that can hold a raffle—usually charitable and not-for-profit organizations.
• And finally, sweepstakes can normally be conducted online and via mobile app. Only some states and municipalities permit raffles to be run online.

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So, what are raffles?

The definition of a raffle varies from state to state, but usually includes:

1. Prizes awarded to winners.
2. Winners selected based on chance.
3. Consideration is required for entry. (AKA, the participant has paid money to play.)

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What exactly is a sweepstakes?

A sweepstakes is a draw in which prizes are given away to participants. There is no purchase required to enter (Although nonprofits can suggest participants give a donation.) and the winners are selected at random from all the eligible entrants.

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What makes a contest a contest?

A contest is an event where participants compete and ****are judged according to a predefined set of criteria. The criteria can be a skill, such as proficiency at writing or drawing, or an opinion such as the popularity of an entry among fans. The “best” entry is selected to win and is awarded a prize.

Raffle laws FAQs.

What’s the legal difference between a raffle and a drawing?

The simplest answer is:

A raffle requires participants to pay to play and drawing is free to play.

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Is a giveaway a raffle?

In a raffle, participants buy tickets for a chance to win, with the winner being chosen at random. In a giveaway, participants enter for a chance to win by completing a specific action, such as following a social media account.

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Do you need a license or permit to hold a raffle in the US?

Yes and no! 48 out of the 50 US states allow nonprofits to host raffles. Of those 48, eight (8) don’t require nonprofits to apply for a license or permit. (Florida, Maine, Montana, Ohio, Oklahoma, Texas, Vermont, and Wyoming.)

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How much does it cost to apply for a raffle license in the US?

Hosting a raffle in the US can cost your nonprofit anywhere from $0.00 to $600.00. Plus, some states require nonprofits to also pay a percentage of their ticket sales to the state or municipality.

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What to include on your raffle ticket?

• Space for the ticket holder’s name and mailing address.
• The web address where you will post the winning number(s).
• The period of time for which the winning number will be posted.
• A phone number that ticket holders can call to verify the winning number.
• Your license number.
• The ticket number.
• The name of your nonprofit organization exactly as it appears on your license.
• The date, time and place of the draw.
• The price of a ticket. (And the cost if tickets are purchased as a package.)
• A description of the major prize(s).
• Date(s) when the ticket price will increase or decrease.
• The word “RAFFLE.”
• Print on each ticket a statement indicating that the ticket holder need not be present to win prize.
• Any house rules.
• Be sure to add any sponsor logos!

This template is a great example of what your tickets should look like. Feel free to use it as a guide to make your own. (We recommend using Canva for nonprofits.)

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Start your raffle for free on Zeffy.

Not all states allow nonprofits to sell raffle tickets online. But, you can still use online fundraising and raffle platforms to:

• Track your raffle sales by campaign.
• Keep track of who purchased what and their info (such as email addresses and phone numbers) so you can contact the winner(s).
• Keep track of how many tickets you have sold, any additional donations, etc.
• Automatically create a contact list to send thank-you emails, re-engage with donors, and even let donors know when next year’s raffle comes along.
• Advertise your raffle. (Newsletters, banners, etc.)
• Display the rules of the raffle.
• Store raffle contact information for your nonprofit.
• Allow participants to download raffle entry forms for manual completion by raffle ticket purchasers.
• Answer frequently asked questions.
• List descriptions, photographs, or videos of the raffle prizes.
• List the prize winners.

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