The Raffle: A Calvin to the Sweepstakes Hobbes

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You can’t hold a raffle to raise funds for your local charity (or yourself). Raffles – a form of lottery which require a purchase or other consideration to enter – are illegal unless you are a charity or benevolent organization. And even then, the state and local governments try to test Ben Franklin’s advice to “do well by doing good.”

No start-up charities. Get a permit. Alert the police. No online. No credit cards. No cash or houses or alcohol prizes. No in Alabama, Hawaii and Utah.

But stop scratching your spiky blond hair and listen to that anthropomorphic tiger. Sweepstakes are still a viable alternative to help raise funds for charity. But don’t just jump into your little red wagon and roll down the hill willy-nilly. Like Hobbes, have a greater understanding of the consequences. Consider:

  • No Donation Necessary. You can’t require a donation to enter, but you may be able to ask for one. You may need to give something in return for the donation (beyond an entry), since you don’t want to run afoul of gambling laws. And you don’t want anything from the charity in return, since you don’t want to be a professional fundraiser.
  • Buy This To Enter and We’ll Donate a Portion to Charity. You can’t require a purchase to enter, but you can be a commercial coventurer and advertise that you’re donating a portion of the proceeds from the sale of your products to charity. This generally requires contracting with the charity, registration and bonding in six states, and recordkeeping.

With apologies to Hobbes, there is usually more than one way to skin a cat.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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