In both the United States and Canada, all types of fundraising raffles are considered to be games of chance. Consequently, they are very tightly regulated and failure to adhere to state raffle laws is considered a serious offense.
If you have any doubt about the correct procedures, do not rely on anybody’s word but a government official or a lawyer knowledgeable in these matters. Get it in writing if its not available online.
In many areas there may be more than one governmental body that has jurisdiction over a fundraising raffle. It is always good to check your state/province/territory and your local government for any necessary licenses and permits.
In almost all cases an application for a license must be made to the governing unit. This application and the resulting permit may takes weeks or months to process and receive.
Do not proceed to hold a fundraising raffle without having the necessary paperwork in hand.
Texas state law as administered by the Texas Attorney General. Compliance with just one or the other will not be sufficient, as a charitable raffle must comply with the requirements of both. Moreover, failure to comply with Texas state law may result in increased regulatory requirements and increased taxes and penalties owed to the IRS. Texas law allows only certain charitable and nonprofit organizations to conduct raffles to support their charitable causes. In order to conduct a raffle legally, a nonprofit organization must have, among other criteria, an exemption from federal taxes under Section 501(c) of the Internal Revenue Code.
United States
Each state in the United States sets their own rules for fundraising raffles. Some have very relaxed rules while on the other extreme, a few states do not allow fundraising raffles in any way, shape or form. Alabama and Hawaii both ban raffles outright.
Almost all states and local governments require certified nonprofit status to be eligible to conduct a raffle.
Here are links to raffle laws and regulations on a state-by-state basis (where available):
Nonprofit Raffle Laws State by State
Alabama – Illegal to do a raffle
Arizona
Arkansas – Legalized in 2007, but no definitive information online yet. Link is to Secretary Of State website.
Colorado – Raffle permit application PDF
Georgia – Contact your County Sheriff’s Office
Hawaii – Illegal to do a raffle
Illinois – Contact your County Clerk for forms
Kansas – Legal with some restrictions
Michigan – Raffle permit application PDF
Montana – Nonprofit groups contact your local board of county commissioners’ office
Nebraska – Raffle permit application PDF
Texas Online Gambling Laws
Rhode Island
South Carolina – Legal, but limited online information as to how to get a permit
Utah – Illegal
West Virginia – Raffle permit application PDF
Home Raffles In Texas
- Hold ’Em or Fold ’Em: Policing Texas Poker Rooms for ProfitA blog post from the State Bar of Texas discussing how the recent police raids of poker clubs in Harris County may pave the way for other local governments to try and shut down gambling clubs.
- Texas’ Membership-only Card Clubs Circumvent Gambling LawsA 2019 article from Reporting Texas discussing how private poker clubs continue to operate despite the state's gambling laws.
- Texas AG declines opinion on legality of poker clubs: The clubs claim they're operating under a loophole in state law. Ken Paxton left it to the courts to decideA 2018 article from a local Houston news station discussing the Texas Attorney General's decision not to issue an opinion on the legality of poker rooms.
- Are poker clubs legal in Texas? The answer is unclearA 2019 article from the Houston Chronicle discussing how poker clubs are seeming to operate in Texas due to a gray area of the law and recent attempts by Harris County to bring criminal charges against them. May require a subscription.
- North Texas poker clubs gambling that state law, police won't make them foldA 2017 article from the Dallas News discussing the gray area in state law and how enforcement varies depending on the interpretation of local law enforcement across Texas. May require a subscription.