Charitable Raffle Facts
What is a raffle?
A raffle is the awarding of one or more prizes by chance at a single occasion among a pool or group of persons who have paid or promised a thing of value for a ticket that represents a chance to win a prize.
What are examples of legal raffles?
A Booster or PTO organization that is a 501 c (3) organization for three years could conduct a raffle whereby individuals purchase tickets for a chance to win a prize in a drawing. Raffles are not the same as auctions or contests where money is placed in jars to “vote” for a contest winner. In a raffle, people buy chances to win a set prize.
What are examples of illegal raffles?
Examples of unlawful raffles include any raffle that is 1) conducted by an individual, 2) conducted by a for-‐profit business or 3) conducted by a charity that has no members or otherwise does not qualify.
Is Carroll ISD an authorized and legal organization to conduct a raffle?
No. Carroll ISD is NOT an authorized organization able to conduct raffles. In turn, Carroll ISD employees are NOT authorized or legally able to sell raffle tickets as representatives of Carroll Independent School District.
Can parents or individuals conduct raffles on behalf of Carroll ISD?
No. Individuals are not authorized to conduct a raffle as per state law. Only qualifying organizations may conduct a raffle on behalf of Carroll ISD.
Can raffle tickets be sold on school premises?
No, raffle tickets may not be sold at Carroll ISD campuses during school hours. With permission from CISD, however, raffle tickets may be sold on school grounds during events outside of the regular school day IF the group is a legally-‐authorized organization to conduct a raffle as per Texas law.
Which organizations does Texas allow to conduct a raffle?
According to the Office of the Texas Attorney General, in order to conduct a raffle legally, a non-‐profit organization must have, among other criteria, members who elect a governing body and an exemption from federal taxes under Section 501 (c) of the Internal Revenue Code. A qualified non-‐profit must also have been in existence for three years.
Are there restrictions on how many raffles a qualified organization can hold?
The law permits only two raffles per year, requires several disclosures printed on tickets, and limits the value of prizes purchased by the organization to $50,000.
Can any school-‐related groups conduct a raffle?
A “qualified non-‐profit organization” for purposes of the Charitable Raffle Enabling Act may conduct raffles in accordance with the Act to benefit the District or school. A parent-‐teacher organization may be qualified to hold such raffles if it meets the requirements of the Act. The qualified non-‐profit must have been in existence for three years.
What other restrictions does Texas place on organizations conducting raffles?
It is against the law to hold a raffle in which cash or anything readily convertible to cash, is offered as a prize, or which is promoted statewide or through paid advertising, including television, radio or newspapers.
What are the penalties for conducting an illegal raffle?
An unlawful raffle could be considered illegal gambling, which may carry criminal penalties. A county, attorney, district attorney or the attorney general may also shut down an illegal raffle.