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Our Booster Club Does a 50/50 Game at Our Fundraisers. Is This Gambling?

The key to successful booster club fundraisers is encouraging participation and having fun. One of the easiest ways to do this is with a 50/50 game at fundraisers. 50/50 games incentivize supporters to donate by offering a prize and also help the organization meet its fundraising goals.

While it seems like a harmless activity, 50/50 games are often considered gambling, which can come along with a whole host of rules for your event. Your booster club responsibilities include ensuring that all activities are permitted under the laws of your state, so it is a good idea to familiarize yourself with the rules around gambling.

Gambling Laws

Under federal law, gambling is defined as “accepting, recording, or registering bets, or carrying on a policy game or any other lottery, or playing any game of chance, for money or other thing of value.”

Your state likely has its own gambling laws as well. Without a license, your event could be considered an illegal gambling activity, which can put your club and its officers at risk.

There are certain exceptions to these rules. Your raffle could be considered “charitable gaming,” in which case you do not need a full gambling license in most states.

In some jurisdictions, while a full gambling license is not required, there still may be local requirements. For example, some states require a raffle license issued by the local county sheriff’s office.

IRS Fundraising Gaming Rules

In addition to the possibility of violating gambling laws, holding a 50/50 raffle could also have tax implications. There are strict rules from the IRS about what is considered gambling. The agency offers guidance on this and considers the following activities gambling:

Lotteries
Raffles
Bingo
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Punch boards

While it’s possible that your raffle could be considered to be a game amongst parents where the winner donates their proceeds, it can be a risky interpretation that opens your organization up to risk.

Things to Consider

If you are planning on hosting a 50/50 raffle at your next fundraiser, you need to make sure you are legally permitted to do so. Before moving forward with the plan, there are a few things you should consider:

What are the booster club laws in your state?
Do booster club rules permit this type of activity?
Who is responsible for ensuring compliance with the laws?
Are all booster club officers in agreement?
Has the club hosted a raffle before?

Since booster club officers can be held personally responsible for illegal activity in the club, you should take extra care in doing your research before hosting the raffle.

Consult with a Professional

The best thing you can do to prepare for your raffle is consult with a professional. Most states have an accessible gaming commission that will be able to answer specific questions about your raffle. In addition, a tax professional can help walk you through the implications of the raffle at your event.

Planning an event with a raffle takes coordination of a lot of moving parts. Stay organized with a booster club software, like BoosterHub, which can help you manage documents, organize communication, and keep track of volunteers.

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Ways to Fundraise for a Booster Club

Fundraising is perhaps one of the most important functions of your booster club. However, it can be tough to build momentum, especially if you are new to fundraising as a whole. You can also get stuck in a rut and feel like you are running the same two or three events on repeat. That’s when it’s important to mix things up to keep club members and donors engaged, ensuring a steady stream of support for your student-athletes. With that in mind, here are a few ways to raise more money for the student-athletes you support:

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Non-Profit Donation Receipt

Whenever someone donates to your club, you must ensure that you send them a clear receipt so they can take advantage of their tax deduction. These receipts are your club’s way of saying, “Thanks for being on the team,” and they’re essential for keeping records organized. Providing a timely and well-documented receipt also makes your club appear professional and organized. In turn, you’ll be able to more easily build trust with donors and encourage them to give again in the future. After all, donors need to be confident that you’re acknowledging and managing their contributions properly. On that note, here are a few tips to help you create compliant receipts:

Booster Club Best Practices

Booster Club Rules

You certainly wouldn’t sign up for a sports league without knowing the rules of the game, so why would you attempt to run a booster club without a clear set of guidelines? In a booster club, the rules take the form of bylaws, which are policies and procedures that are vital in keeping everyone on the same page, helping to avoid misunderstandings, and ensuring that each member understands their part in supporting the club’s mission. In some cases, these bylaws will spell out who can and can’t be members, as well as who is eligible to serve on the board. Some states even have standardized playbooks that you need to follow. The University Interscholastic League (UIL) in Texas, for instance, has a playbook of its own, covering specific bylaws for booster clubs that support school programs. In any case, here are some tips for ensuring everyone in your booster club plays by the rules so you can have a productive year: