CA Raffle Regulations
As of July 1, 2001, the California state Attorney General’s Office requires charitable organizations to register raffles in advance and to complete post-raffle reports. A partial excerpt from the Attorney General’s website (http://caag.state.ca.us/charities/raffles.htm) states:
“In California, charities and certain other private nonprofit organizations may conduct raffles to raise funds for beneficial or charitable purposes in the state. This exception to the general constitutional prohibition against lotteries requires that at least 90 percent of the gross receipts from these raffles go directly to beneficial or charitable purposes in California. Additionally, a nonprofit organization, unless specifically exempted, must register with the Attorney General’s Registry of Charitable Trusts prior to conducting the raffle and file financial disclosure reports on each raffle event.”
Q&A from the California Office of the Attorney General’s website
- May charities hold raffles to raise funds?
- Recent changes to the state constitution and Penal Code provide a narrow exception to the prohibition against gambling in California. After July 1, 2001, certain tax-exempt groups such as charities may hold fund-raising raffles.
- What is a raffle?
- A raffle is a type of lottery in which prizes are awarded to people who pay for a chance to win. Each person enters the game of chance by submitting a detachable coupon or stub from the paper ticket purchased. A raffle must be conducted under the supervision of a natural person age 18 or older. At least 90 percent of the gross receipts from raffle ticket sales must be used by the eligible tax-exempt organization to benefit or support beneficial purposes in California. Groups are prohibited from awarding raffle prizes by use of a gaming machine, apparatus or device such as a slot machine. A raffle may also not be advertised, operated or conducted over the Internet. However, the organization conducting the raffle may place on its web site an announcement of a raffle. See Penal Code section 320.5 and Statutes and Regulations.
- Who may hold raffles?
- Only eligible private, tax-exempt nonprofit groups qualified to conduct business in California for at least one year prior to conducting the raffle may conduct raffles to raise funds for the organization and charitable or beneficial purposes in California.
- Does an organization already registered as a charity need to register separately to conduct a raffle? Are there separate reporting requirements?
- Yes. Raffle registration is a separate requirement from charity registration. Before conducting a raffle, your group must be registered with the Attorney General’s Registry of Charitable Trusts. Your group also must receive written confirmation of your annual registration before holding the initial raffle. Depending on volume, it could take up to 60 days after receipt of the registration form to receive confirmation. A report on raffle activities is required during the year (September 1 through August 31) in which any raffle is held.
- Must all eligible organizations register and report?
- Nonprofit religious organizations, schools and hospitals are exempt from the registration and reporting requirements; however, even though they are not required to register and report, those organizations must still comply with all other provisions of Penal Code section 320.5
- Can my organization hold a raffle immediately?
- No. Before conducting a raffle, your group must be registered with the Attorney General’s Registry of Charitable Trusts. Your group also must receive written confirmation of your annual registration before holding the initial raffle.
- If an organization gives away raffle tickets, does it have to register and report?
- Registration is not required if all tickets for a drawing are free, and solicitations of voluntary donations to the organization are in no way connected to distribution of tickets, and this is made clear to all participants. If you require a “donation” in return for a ticket, you must register.
- How do I register to conduct a raffle?
- Raffle registration forms are available on the Internet at Charities Forms, or may be requested by mail, fax or telephone. Complete the raffle annual registration form (ct-NRP-1) and mail to the Registry with a $20 registration fee by September 1 of the year (September 1 – August 31) in which you expect to hold a raffle. You must receive written confirmation of your registration before holding a raffle. A raffle registration is good for 12 months – from September 1 through August 31 and must be renewed annually.
- If my organization registers but decides not to old a raffle, is the fee refundable?
- No.
- What information must be provided for raffle registration?
- Name and address of organization, name and title of “fiduciary” and one or more of the following: Federal Tax ID number, Corporate Number, Organization Number or California Charitable Trusts Identification Number.
- When is the Nonprofit Raffle Report disclosing raffle activities required to be filed?
- A separate disclosure report is required for each raffle held by the organization. The reports may be filed with the Registry of Charitable Trusts anytime after the conclusion of a raffle, but must be filed by no later than September 1 of each year for activities in the current registration period.
- What kind of record keeping is required?
- The required information appears on the Nonprofit Raffle Report form (ct-NRP-2). Basically, the organization must report the date and location of the raffle held; total funds received from the raffle; total expenses for conducting the raffle; the charitable or beneficial purpose for which raffle proceeds were used or the amount and organization to which proceeds were directed.
- Are there limits on raffle prizes?
- California’s state law does not specify any limits on the value of raffle prizes.
- Does an organization report individual buyers of raffle tickets?
- No.
- When can an organization expect to receive confirmation of registration?
- Depending on volume, it could be up to 60 days after receipt of the registration form.
- Can I complete the registration and report forms on the Internet?
- Yes. However, upon completion, you must print it, sign and mail it along with the fee to the Registry of Charitable Trusts.
If you have further questions, please contact the District's Club Budgeting and Fundraising Chair, Kathy Delaney
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