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Learned something new today. It is illegal to raffle a car.
We have become aware of a proliferation of illegal raffle activity in Texas. It is important for Texans to be familiar with the law before conducting or participating in a raffle.
Examples of unlawful raffles include any raffle that is:
Texas law allows only certain charitable and nonprofit organizations to conduct raffles to support their charitable causes. Only the following entities which meet certain qualifications are permitted to hold raffles:
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. A qualified nonprofit must also have been in existence for three years. The law permits only two raffles per calendar year, requires several disclosures printed on tickets, and limits the value of prizes purchased by the organization to $50,000, or $250,000 if the purchased prize is a residential dwelling.
It is also 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.
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.
We have become aware of a proliferation of illegal raffle activity in Texas. It is important for Texans to be familiar with the law before conducting or participating in a raffle.
Examples of unlawful raffles include any raffle that is:
- conducted by an individual
- conducted by a for profit business
- conducted by a charity that does not qualify
Texas law allows only certain charitable and nonprofit organizations to conduct raffles to support their charitable causes. Only the following entities which meet certain qualifications are permitted to hold raffles:
- religious societies
- volunteer emergency medical service providers
- volunteer fire departments
- qualified nonprofit organizations
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. A qualified nonprofit must also have been in existence for three years. The law permits only two raffles per calendar year, requires several disclosures printed on tickets, and limits the value of prizes purchased by the organization to $50,000, or $250,000 if the purchased prize is a residential dwelling.
It is also 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.
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.
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