I want to know if it will be legal to get 1 million people to donate $1, and later hold a raffle and pay the winner’s charitable cause 500K

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I want to know if it will be legal to get 1 million people to donate $1, and later hold a raffle and pay the winner’s charitable cause 500K

Asked on August 19, 2011 Florida

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

From the general question that you have posed, your suggested raffle by you to hold a raffle where one million people donate a dollar per ticket and pay the winner's charitable cause one half of the money generated would most likely be illegal under Florida state law as well as the laws of the other states in this country and territories.

Every state has stringent requirements for raffles where the entity holding the raffle needs to be a registered tax exempt entity under Internal Revenue Service guidelines with proper applications and forms filed both at the federal and state level with a registered tax identification number on file.

There are also required applications and reporting forms for the suggested raffle at the state and local level with detailed information as to where the money from the raffle will be deposited and ultimately distributed.

The reason for these stringent guidelines and requirements is that there have been a lot of scams in the past over proposed raffles where the money is paid for tickets as part of the raffle but there has been no payout to the winner.


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