Prizes

Prize limits: For all raffles conducted by a licensed organization:

the value of each raffle prize may not exceed $50,000;
there is no limit on the total value of prizes awarded for each raffle; and
there is no limit for the total value of all prizes awarded in a calendar year.

Types of Prizes Allowed
Prizes for a raffle may consist of:
1. cash;
2. gift cards or gift certificates; or
3. merchandise, which includes certificates for merchandise, certificates for services, and real property.
If prizes require registration or licensure by a government agency as a condition of ownership, a certificate of merchandise must be used.
Types of Prizes Not Allowed

Merchandise Prizes

Certificate for Merchandise or Services—Required Information
A certificate for merchandise or services awarded as a prize must include:
- a complete description, including the value, of the merchandise or services;
- the vendor’s name from whom the certificate must be redeemed; and
- a statement expressly prohibiting the substitution of cash or another type of merchandise or services described on the certificate.
Ownership of Prizes Required

For raffles with gross receipts over $60, an organization must pay in full for all raffle prizes or otherwise become the owner without lien or interest of others, prior to the raffle drawing.

For raffles with gross receipts of $60 or less, such as a meat raffle, an organization may pay for the prizes (meat) up to 30 days after the organization obtains the prizes (meat).
50/50 (Share the Pot) Raffle Prizes
The prize amount for 50/50 (share the pot) raffles must be a percentage of the raffle’s gross receipts.
- Organizations must calculate prizes on receipts before expenses, not after. Expenses may not be taken out prior to splitting the pot.
- The percentage of the split of gross receipts must be stated on the raffle tickets and in the house rules.
- Before the drawing, the gross receipts must be tallied and the prize amount must be announced.
Age Restrictions
Persons under age 18 may not be awarded a raffle prize.
- Because of this restriction, a person 18 or older should not put the name of someone under age 18 on a raffle stub.

Restrictions on Awarding Alcohol as a Raffle Prize

Donated prize	Prizes may be donated.
Lessor restrictions	For a leased premises: the lessor may donate prizes, and the organization may purchase a certificate for merchandise or gift to be redeemed for food or beverages at the premises if: the certificate or card value has a redeemable monetary cash value; the certificate or card does not contain restrictions on its redemption, such as requiring a purchase of food or beverage of equal or greater value or redeemable for a specific item; the certificate or card may be redeemed at any time during the regular business hours of the permitted premises; and the cost to the organization is 50% or less of the redeemable cash value of the certificate or card.
Compliance with prize limit	To determine compliance with the prize limit for each prize, merchandise prizes donated to an organization or purchased at a discount must be valued at their fair market value. The fair market value of a merchandise prize must not be an amount less than the purchase price.
Report on LG100A	For purposes of reporting on the monthly LG100A: donated prizes have no value (not reported), and merchandise prizes are reported at their actual cost plus shipping and sales tax.