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Charitable Lottery Regulations

Nonprofit raffle laws in Pennsylvania.

September 6, 2023

In the United States, raffles, opportunity drawings and lotteries are governed by the individual states. Each state has its own set of definitions and laws that dictate what is considered a raffle, which organizations are permitted to host a raffle, and what is required to legally host a raffle within the state.

Some states make it a bit more complicated than others, but nonprofit organizations that host ticketing events like raffles often end up hosting more than one raffle per year and some of the biggest campaigns on Zeffy are raffles. AKA raffles raise a lot of money for the nonprofits that host them.

So, yes, the first raffle you host can be a bit time-consuming and confusing, but all the time and energy invested is ultimately worth it. Plus, raffles are a great way to mix up your fundraising campaign portfolio and, as an added bonus, they attract new donors to your nonprofit. And, of course, we’re here to help by walking you through the process of setting up a raffle on Zeffy and we’ve even got a few tips on how to create successful charity raffles and lotteries.

Okay, let’s get started.

Pennsylvania defines gambling as:

Gambling exists when there is a payment of consideration or a fee or something of value for the opportunity for a prize or reward, the winner of which is determined by chance. Effectively, the three elements are:
1: Consideration
2: Chance
3: A prize or reward

Who can host a raffle in Pennsylvania?

Pennsylvania is fairly strict with their gambling laws and only authorizes the following forms of gambling:

As a nonprofit organization in Pennsylvania, you need to follow the rules and regulations in the Local Option Small Games of Chance Act and, sometimes the Sport Raffle Charities Act. Our main focus in this article will be on the Local Option Small Games of Chance Act.

The small games of chance law authorizes eligible non-profit organizations to host:

How does Pennsylvania define eligible nonprofit organizations?

Pennsylvania defines an eligible organization as one of the following:

Good to know:

To be granted a games of chance license in Pennsylvania, your nonprofit needs to be have been working towards fulfilling its purpose for at least one year.

What is a Small Games of Chance Club License in PA?

Any nonprofit organization that falls under the Internal Revenue Code Section 501(c) or 527 and that is licensed to sell liquor under Section 404 of the Pennsylvania Liquor Code, is considered a club under the Local Option Small Games of Chance Act.

Do you need a raffle license to host a raffle or a 50-50 raffle in Pennsylvania?

Nonprofit organizations can apply for one of two types of raffle licenses: a regular license or a monthly license. Both licenses will allow your nonprofit to host any of the games of chance listed above. (And, if you're hosting a raffle, Zeffy can help!)

A regular license is:

A regular license is what Pennsylvania calls an annual license. If your nonprofit is approved, an regular/annual license is good for an entire calendar year, starting from the date it was issued. (The fee for a regular/annual license is $125.)

A monthly License:

A monthly license is valid for, you guessed it, 30 consecutive days from the date it was issued. Your nonprofit can apply for and obtain as many monthly licenses as you want, but the licenses cannot overlap. (The fee for a monthly license is $25.)

Good to know:

Pennsylvania also grants Special Raffle Permits to nonprofit organizations with a regular or monthly license. A special raffle permit allows your nonprofit to conduct a raffle that exceeds the normal prize limits. (We’ll get to those in a bit.)

Your nonprofit can apply for a special raffle permit through your country.

A licensed nonprofit organization can apply for and obtain up to 10 special raffle permits per year. The total prizes awarded under all special raffle permits may not exceed $150,000 per year.

Volunteer fire, ambulance, rescue or conservation organizations may obtain up to 12 special raffle permits and award up to $250,000 in prizes.

How does a nonprofit apply for a licensed raffle in Pennsylvania?

Eligible nonprofit organizations who want to host a raffle or small game of chance need to apply for a regular/annual or monthly license at the county treasurer in their county. If your county doesn’t have a county treasurer, you can apply directly with the licensing authority.

How to apply for a small games of chance license in PA?

While you cannot apply online for a small games of chance license in Pennsylvania, you can download forms, file tax returns, etc. Just visit: myPath and create or log into your account.

Are their prize limits for raffles hosted by nonprofit organizations in Pennsylvania?

Yes, there are prize limits to keep in mind when hosting a raffle in Pennsylvania.

Nonprofit and nonprofit club’s with a regular/annual or monthly license:

Raffles conducted under a special permit:

A special raffle permit allows your nonprofit to conduct a raffle that exceeds the normal prize limits.

Daily and weekly drawing carryovers:

Amounts paid out in a carryover drawing are not subject to the general prize limits. (A carryover happens when there is no winner and the prize is carried over to the next daily or weekly drawing.)

100 percent payout drawings:

When a draw is conducted that awards 100% of the gross revenue from the game or raffle, then the prize does not count against the $35,000 weekly prize limit.

Can you sell raffle tickets online in Pennsylvania using Zeffy’s ticketing forms?

Unfortunately, for now, you cannot sell any raffle tickets over the internet in Pennsylvania. We know, we think it’s a bit of an outdated rule too. But, while you can’t use Zeffy’s free event and ticketing software to sell or redeem your raffle tickets in Washington State, you can still use Zeffy to:

Pennsylvania also allows you to use the internet to:

Good to know:

Unlicensed raffle records must be kept for one to five years depending on your license.

In Pennsylvania, all nonprofit raffle and games of chance proceeds must be used for public interest purposes.

In addition to using 60% of proceeds to invest in your cause, nonprofit organizations can use 40% of their proceeds to purchase games of chance equipment and to pay for license fees.

And, if you’re wondering what Pennsylvania defines as an appropriate cause (public interest purposes), well:

Good to know:

A nonprofit organization with revenue from a game of chance or raffle in excess of $40,000 is required to keep all small games of chance proceeds in a bank account separate from all other organization funds or accounts.

If your nonprofit has been designated a “club”, there are a few other rules and regulations to follow.

What to include on any promotional materials your nonprofit shares.

There aren’t too many more must-haves in terms of nonprofit lottery and raffle laws in Pennsylvania, however, we recommend including a few details on any promotional materials:

Rules and regulations for tickets and ticket sales in Pennsylvania.

Pennsylvania has set a few rules and regulations regarding the sale of raffle tickets.

What to include on tickets for your nonprofit’s raffle.

Although it’s not written, we do recommend that printed tickets have a detachable coupon or stub, and that both the ticket and its coupon or stub are marked with a unique and matching number.

You can purchase pre-made tickets or get inspired by our sample ticket:

Does it cost money for a nonprofit to register for a lottery in Pennsylvania?

Yes! Fees vary depending on the type of license you’re applying for.

After your nonprofit’s raffle…

A licensed nonprofit organization needs to keep records to demonstrate that your nonprofit organization is properly following all of Pennsylvania’s rules and regulations.

A licensed eligible organization must retain its records for at least two years. A club licensee must keep its records for at least five years.

Your nonprofit’s records must include the following:

A licensed nonprofit organization must also maintain records relating to the printing or purchase of materials to be used for raffles and daily and weekly drawings. Records should include an invoice or receipt from the place of purchase that shows the cost and number or amount of the materials purchased.

Good to know:

The Pennsylvania State Police Bureau of Liquor Control Enforcement has record-keeping tools on its website to help your nonprofit keep proper records.

Here’s a recap of all the links and documents mentioned in this article:

Pennsylvania Department of Revenue: REV-1750 Small Games of Chance Overview.

Eligible Organization Games of Chance Application.

Small games of chance forms.

Pennsylvania County Treasurers Office list.

Small Games of Chance use of 60% proceeds form.

Small Games of Chance use of 40% proceeds form.

Schedule A: Prizes by Week tracking form.

Schedule B: Net revenue by week.

Schedule 2-B: Regular Raffle/Special Raffle.

Schedule 2-D: 50/50 Drawing Weekly Operating Record.

Schedule 3: Record or prizes awarded in excess of $600.

Small Games of Chance Distributors List.

If you need them: charitable lottery licence laws for other US states.

Nonprofit raffle laws in California.

Nonprofit raffle laws in Colorado.

Nonprofit raffle laws in Connecticut.

Nonprofit raffle laws in Florida.

Nonprofit raffle laws in New York.

Nonprofit raffle laws in Texas.

Nonprofit raffle laws in Washington State.

Keep learning (our sources):

1. Pennsylvania Department of Revenue: REV-1750 Small Games of Chance Overview.

2. Requirements to Have a Raffle in Pennsylvania.

3. 50-50 Raffles Are Legal In Pa. After Overhaul Of 'Games Of Chance' Law.

4. State Law Keeps Non-Profits From Selling Raffle Tickets Online In Cashless Society.

5. Pennsylvania State Police: Small Games of Chance.