What Nonprofits Need to Know
Charitable gaming—such as raffles, bingo nights, and casino-style events—offers nonprofit organizations a creative and engaging way to raise funds. But before hosting your next game of chance, it’s essential to understand that most states require more than just a gaming license.
Several foundational registrations must be in place before a charitable gaming license can even be considered. If your organization skips these steps, you may face compliance issues, fines, or even legal consequences.
At BryteBridge, we help nonprofits navigate the maze of requirements, ensuring your events are not only successful but also compliant.
What is Charitable Gaming?
Charitable gaming includes any game of chance conducted by a nonprofit organization to raise funds. Common examples include:
- Raffles
- Bingo
- Poker tournaments
- Casino nights
- Pull-tabs
While these events are fun and community-driven, they are heavily regulated, especially at the state level.
Foundational Registrations You May Need First
Before applying for a charitable gaming permit or license, your organization typically must have several other registrations in place. These vary by state but often include:
1. State Incorporation
Your nonprofit must be legally incorporated in your state as a nonprofit corporation.
2. IRS 501(c) Tax-Exempt Status
A valid IRS determination letter proving your federal tax-exempt status (e.g., 501(c)(3)) is typically required.
3. State Charitable Solicitation Registration
Most states require nonprofits to register before soliciting donations including through gaming. This is often managed by the Attorney General or Department of Consumer Affairs.
4. State Sales Tax Exemption Certificate
In some states, this registration may be required to handle the sale of tickets or merchandise at events without incurring sales tax.
5. State Business or Occupation License
Even as a nonprofit, your organization may need a general business license to operate legally in your state.
6. Local Permits
Municipalities or counties may require their own licenses or permits for holding gaming events.
Once these are completed, you can usually apply for a Charitable Gaming License through your state’s gaming commission, lottery board, or similar regulatory body.
Why You Need Additional Registrations
Even if your nonprofit is federally recognized as a 501(c)(3), you may still need to:
- Register with your state’s gaming authority
- Obtain a charitable gaming license or permit
- File reports on proceeds and payouts
- Follow specific guidelines on advertising and prize values
These requirements vary widely by state. For example, some states prohibit raffles entirely unless approved in advance, while others may limit the frequency or dollar value of prizes.
Common Mistakes Nonprofits Make
- Assuming 501(c)(3) status covers everything, IRS tax-exemption doesn’t equal gaming approval.
- Using unlicensed volunteers – In some states, workers must be registered with the gaming board.
- Failing to track proceeds – States often require detailed accounting of how gaming revenue is used.
How BryteBridge Helps Nonprofits Stay Compliant
At BryteBridge, we help nonprofits navigate the complex world of charitable gaming compliance. Our team understands the nuances of each state’s rules and can guide you through:
- Identifying whether your state requires additional gaming registration
- Completing and submitting the proper forms
- Ensuring your fundraising stays in good standing with regulators
With BryteBridge, you don’t have to guess; we help you get it right the first time.
Ready to Host a Compliant Charitable Gaming Event?
Don’t let paperwork and regulations slow down your fundraising goals. Whether you’re planning your first bingo night or an annual raffle, BryteBridge is here to help you stay compliant and successful.
For more information, join BryteBridge Connect Membership for Live Bootcamps, Webinars, and classes. Speak to a BryteBridge Consultant today by calling 877-857-9002.
