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Raffle laws

Georgia Raffle Laws 2026: Free Guide to Code 16-12-22.1

August 2, 2026
TL;DR — The Short Answer

Verdict: Are raffles legal in Georgia? Yes, with a county sheriff's license, 24 months of operating history behind you, and a CPA-signed report to the sheriff each April 15. Can you sell the tickets online? No: O.C.G.A. 16-12-22.1(h) requires the raffle to be operated on premises your nonprofit owns or leases, and that premises rule is what closes off online sales. Can you sell them in person and take a card? The statute does not address payment methods at all, so there is nothing in it either permitting or forbidding a card. Your sheriff licenses the raffle and can attach conditions to that license under (l), so ask there before you plan on taking cards.

What works: Registering with your county sheriff early, keeping a CPA-signed paper trail for every raffle, and using a free platform like Zeffy to simplify your reporting.

What doesn't: Hiring outside promoters, selling tickets online, or assuming one county's rules apply statewide. Georgia enforces raffle law at the county level.

Best for: Georgia nonprofits, churches, schools, and civic organizations planning fundraising raffles.

Worth considering if: You're unsure whether your organization qualifies, or you're planning a multi-county raffle.

Table of contents

Hosting a raffle in Georgia as a nonprofit is legal, but only if you follow a specific list of rules. Georgia Code places clear restrictions on raffles to keep them separate from gambling. Whether you're boosting fundraising or just trying to stay on the right side of the law, here's what a small Georgia nonprofit actually needs to know. For a wider view, see our guide to 501(c)(3) raffle laws by state.

Are raffles legal in Georgia?

Yes, for nonprofits. Georgia Code Section 16-12-22.1 defines a raffle as a scheme or event where people pay (or are promised) something in exchange for a chance to win a prize. The state also treats door prizes and admission-fee drawings as raffles.

Because Georgia enforces raffle law county by county, your local sheriff is the person who says yes or no to your license. Here's a helpful map of Georgia counties from the Georgia Department of Transportation.

For a small nonprofit: raffles are on the table, but only if you're ready to treat them like a paperwork fundraiser (a sheriff's license, 24 months of operating history, and a CPA-signed annual report) from ticket #1.

Georgia-counties

Georgia Code 16-12-22.1: The provisions that decide what you can do

Most guides summarize Georgia's raffle law. To really understand your obligations, you need the actual statute. Below are the subsections of Georgia Code 16-12-22.1 that decide what your organization can and cannot do, quoted verbatim, each with a plain-English note. Subsection letters are the statute's own.

16-12-22.1(a): Who can legally hold a raffle

Statute text:

It is the intention of the General Assembly that only nonprofit, tax-exempt churches, schools, civic organizations, or related support groups; nonprofit organizations qualified under Section 501(c) of the Internal Revenue Code, as amended; or bona fide nonprofit organizations approved by the sheriff, which are properly licensed pursuant to this Code section shall be allowed to operate raffles.

What this means in practice: Subsection (a) is an eligibility rule about organizations, not about individuals. You qualify if you are a nonprofit, tax-exempt church, school, civic organization or related support group; an organization qualified under Section 501(c) of the Internal Revenue Code; or a bona fide nonprofit your sheriff has approved. Whichever category fits, you must also be properly licensed under this Code section. Note what (a) does not do: it says nothing about who may sell a ticket, and nothing about how a buyer may pay. The limits on bringing in outside help sit lower down, in (k)(3), which bars contracting your raffle operations out to any individual, firm, association or corporation, and (k)(5), which bars paying anyone consulting fees for raffle services.

16-12-22.1(c) and (d)(1): The license requirement, and who can get one

Statute text:

(c) Any other law to the contrary notwithstanding, no nonprofit, tax-exempt organization shall be permitted to operate a raffle until the sheriff issues a license to the organization authorizing it to do so. (d)(1) Any nonprofit, tax-exempt organization desiring to obtain a license to operate raffles shall make application to the sheriff on forms prescribed by the sheriff. The sheriff may require the payment of an annual fee not to exceed $100.00. No license shall be issued to any nonprofit, tax-exempt organization unless the organization has been in existence for 24 months immediately prior to the issuance of the license.

What this means in practice: The license has to be issued before the raffle operates, not after the event and not on the day of the drawing. You apply on whatever form your sheriff prescribes, so the paperwork itself varies county to county. Two statutory gates catch newer organizations: the annual fee can be up to $100.00, and your organization must have been in existence for 24 months before a license can issue. A nonprofit founded last year cannot license a Georgia raffle yet, however strong the cause.

16-12-22.1(j) and (k)(1): The annual report, and the records behind it

Statute text:

(j) On or before April 15 of each year, every nonprofit, tax-exempt organization engaged in operating raffles shall file with the sheriff a report disclosing all receipts and expenditures relating to the operation of raffles in the previous year. The report shall be in addition to all other reports required by law. The report shall be prepared and signed by a certified public accountant competent to prepare such a report and shall be deemed a public record subject to public inspection. (k)(1) A licensee that conducts or operates a raffle shall maintain the following records for at least three years from the date on which the raffle is conducted…

What this means in practice: Georgia asks for one filing, not a rolling series: a single report to your sheriff on or before April 15 covering the previous year, prepared and signed by a CPA, and open to public inspection once filed. Behind that filing sits the three-year record-keeping duty in (k)(1), which is the part organizations improvise and regret. You have to be able to produce gross receipts for each raffle, an itemized expense list naming each payee with a receipt, the name and address of every winner of a prize worth $50.00 or more, an itemized list of anyone other than your organization who received proceeds, and a count of how many people entered. Build the trail from your first ticket sale. A free tool that lets you record offline raffle ticket sales in one dashboard saves you from rebuilding it in April.

16-12-22.1(m): Penalties for violations

Statute text:

Any person who operates a raffle without a valid license issued by the sheriff as provided in this Code section commits the offense of commercial gambling as defined in Code Section 16-12-22 and, upon conviction thereof, shall be punished accordingly. Any person who knowingly aids, abets, or otherwise assists in the operation of a raffle for which a license has not been obtained as provided in this Code section similarly commits the offense of commercial gambling. Any person who violates any other provision of this Code section shall be guilty of a misdemeanor of a high and aggravated nature. Any person who commits any such violation after having previously been convicted of any violations of this Code section shall be guilty of a felony and, upon conviction thereof, shall be punished by imprisonment for not less than one nor more than five years or by a fine not to exceed $10,000.00, or both.

What this means in practice: The statute splits into two tiers, and the split is the thing to remember. Operating a raffle with no valid license is not treated as a paperwork slip at all: it is charged as commercial gambling under O.C.G.A. 16-12-22, and the same charge reaches anyone who knowingly aids or assists an unlicensed raffle. Breaking any other provision of this Code section, once you are licensed, is a misdemeanor of a high and aggravated nature. A repeat violation by someone already convicted under this section is a felony carrying one to five years, a fine of up to $10,000.00, or both. The practical reading: get the license first, because that is the line between an administrative problem and a gambling charge.

16-12-22.1(h): Where raffles may be operated (the premises requirement)

Statute text:

Raffles shall be operated only on premises owned by the nonprofit, tax-exempt organization operating the raffle, on property leased by the nonprofit, tax-exempt organization and used regularly by that organization for purposes other than the operation of a raffle, or on property leased by the nonprofit, tax-exempt organization operating the raffle from another nonprofit, tax-exempt organization.

What this means in practice: Georgia ties every raffle to physical premises the nonprofit owns, regularly uses for non-raffle purposes, or leases from another nonprofit. This premises rule is the whole legal basis for why online raffle ticket sales are off the table in Georgia. It is a rule about where the raffle happens, not a rule about who handles the money.

Here's the thing readers miss: the words "internet" and "online" never appear in the statute, and neither do "sell", "sale" or "ticket". There's no phantom "no internet" clause. The bar comes from (h) and nothing else: a ticket bought online from a laptop in another county is not a raffle operated on your premises, so it fails the one test the statute actually imposes. Worth knowing what Georgia does not have, because some states do: there is no clause here reaching a person who takes part indirectly in the sale of a ticket. In Georgia the obstacle is location, not the identity of whoever processes the payment.

What is on the table: promote your raffle online (email, social, your website) and transact offline at the physical premises. If your drawing is a live in-person event, you can sell tickets to the live raffle-drawing event with free ticketing. Event admission is a separate transaction from raffle entries and does not trigger the premises prohibition.

For a small nonprofit: the (h) premises rule is why the entire compliance game in Georgia is about your paper trail, not your checkout page. Plan the raffle around the physical venue you already own, use, or can lease from another nonprofit.

Important: Georgia statutes are amended periodically. Always verify the current version of 16-12-22.1 through the Official Code of Georgia Annotated (O.C.G.A.) or consult a Georgia-licensed attorney before planning your raffle.

Can individuals or for-profit businesses hold raffles in Georgia?

No. Georgia's raffle law is written exclusively for nonprofit, tax-exempt organizations. If you're an individual, a for-profit business, or an unincorporated group, you cannot legally conduct a raffle in Georgia.

Under Georgia Code 16-12-22, operating a raffle outside the nonprofit exemption is treated as commercial gambling, which carries felony penalties, potential prison time, and significant fines. The nonprofit exemption under 16-12-22.1 is the only legal pathway to run a raffle in the state. Confirm the current penalty schedule directly with O.C.G.A. 16-12-22 or a Georgia-licensed attorney before you rely on any specific figure.

For-profit companies also cannot partner with a nonprofit as a workaround. Section 16-12-22.1 prohibits individuals, firms, associations, or corporations from taking part in the management or operation of a nonprofit raffle, even in a consulting capacity. A marketing agency cannot manage ticket sales for a charity event. A corporation cannot sponsor prizes in exchange for branding on raffle materials. If a for-profit entity offers to "help run" your raffle, that arrangement puts your license and your standing at serious legal risk.

If you're an individual who wants to support a raffle, join the nonprofit running it and help as a member volunteer. What the statute forbids is the arm's-length arrangement: (k)(3) bars the organization from contracting its raffle operations out to any individual, firm, association or corporation, and (k)(5) bars paying anyone consulting fees for raffle services. Note too that (k)(6) caps what a member can be paid for assisting at $30.00 per day.

For a small nonprofit: if you're a booster club, a PTA committee, or an informal group that isn't yet incorporated and tax-exempt, you're on the wrong side of the statute the moment you sell a ticket. Do the 501(c) work first, then run the raffle.

How to get a raffle license in Georgia

Do you need a license for a raffle?

Yes. Any bona fide nonprofit that wants to run a raffle in Georgia must obtain a permit from its local sheriff's office. Expect an annual fee. See an example of Fulton County Sheriff's Office raffle license instructions here.

There are two types of raffle licenses in Georgia:

  • Standard raffle license: best for an organization that will hold four or more raffles in a single year.
  • Special limited raffle license: best for an organization that will hold three or fewer raffles in a single year, each lasting 30 days at most.

Georgia raffle license requirements (based on local sheriff's office)

  • Your local sheriff's office sets the annual application and license fee (typically up to $100).
  • A minimum of 24 months in operation as a tax-exempt organization.
  • An IRS determination letter certifying the nonprofit is tax-exempt.
  • A copy of the lease or rental agreement for the raffle location (if applicable).
  • A statement of any criminal convictions for all individuals listed on the application.

Steps to obtain a raffle license

  • 1. Prepare your documentation:
  • Names and addresses of officers and directors.
  • Names and addresses of anyone managing, advertising, or promoting the raffle.
  • IRS tax-exempt determination letter.
  • Georgia Department of Revenue exemption (or supporting documents like Form 990).
  • Location details of where the raffle will be conducted.
  • 1. Apply to your county sheriff's office.
  • 2. Enclose the application fee (fee amount depends on your county and license type).

For a small nonprofit: give yourself at least 60 days between filing and your first ticket sale. Sheriff's offices don't rush, and a late license can force you to cancel your drawing.

Georgia county sheriff raffle license directory

Because Georgia enforces raffle law at the county level, your first stop is always your county sheriff's office. Requirements, fees, and forms vary by county. Below are direct links to raffle license pages for major Georgia counties. If your county isn't listed, search "[your county name] Sheriff's Office raffle license Georgia".

  • Columbia County Sheriff's Office
  • Chatham County Sheriff's Office
  • Rabun County Sheriff's Office

Not every county posts its raffle application online. Call your county sheriff's office directly if you can't find a dedicated raffle page. They'll tell you the current fee, required documents, and submission deadline before your event.

fulton-county-raffle-license

Important Georgia raffle laws for nonprofits

The following rules apply to every organization that holds a Georgia raffle license.

Raffle eligibility

Any nonprofit, tax-exempt organization, church, school, civic group, or related support group can run a raffle in Georgia. For individuals, firms, associations, or corporations, partnering or contracting with a nonprofit for a raffle (even for consulting) is illegal. A marketing firm cannot manage raffle operations for a local charity, and a corporation cannot offer prizes in exchange for branding on the tickets.

Eligible organizations are also prohibited from lending their name or identity to an ineligible entity to operate or advertise a raffle.

Raffle location and operations

Raffles can only be operated on the following premises:

  • Premises the licensed organization owns.
  • Premises the licensed organization leases from another nonprofit.
  • Premises the licensed organization leases and uses regularly for purposes other than the raffle.

If a Georgia nonprofit wants to hold a raffle in more than one county, it can do so under a single license from the county where the organization is headquartered. A statewide charity headquartered in Atlanta, for example, can hold raffles in both Atlanta and Savannah under one license. The raffle license must be visible at the location where the raffle takes place.

Licensing and violations

Operating without a license, with an expired license, or out of compliance can result in:

  • Violation of Georgia law and criminal prosecution.
  • Being charged with the offense of commercial gambling under O.C.G.A. 16-12-22 (a felony carrying potential prison time and significant fines; verify the current statute for exact figures).
  • Enforcement by the sheriff of the county where the raffle took place.

Important dates:

  • December 31, midnight: raffle licenses issued that year expire.
  • January 1: renewals are due to continue operating legally.
  • April 15: every organization that ran a raffle must file an annual report with its sheriff's office covering the prior year's receipts and expenditures.

Raffle participation and support

Anyone under 18 cannot participate in a raffle unless accompanied by an adult. A violation of this rule jeopardizes the organization's standing.

There are also participation limits for people who belong to more than one raffle-running nonprofit: they can only participate in or work at raffles run by two of those organizations. A volunteer who belongs to a local veterans' association and a charity golf club, for instance, can help with raffles for those two groups but not a third. Volunteers can also only accept up to $30 per day for assisting in raffle operations, totaled across every organization they support.

Raffle reporting requirements

Every organization hosting a raffle must submit thorough reporting after the event. The annual report is prepared and signed by a certified public accountant, and it is a public record subject to public inspection. There is no quarterly filing in the statute, although (l) lets your sheriff add reporting conditions by rule, so check your county's.

Practically, this means flagging your raffle reporting to your CPA or accounting team well before the event so that afterwards everything is in one place. It also means you want to keep every raffle participant and prize winner in one free donor record from the day tickets go on sale, not the week the report is due. You can also email your supporters and promote the raffle from the same dashboard.

Your report should include:

  • An itemized list of gross receipts for each raffle.
  • An itemized list of expenses or expenditures related to the raffle.
  • A lease or rental agreement (or several, if multiple raffles were held).
  • The name of anyone who was paid an expense and the related receipts.
  • A list of all prizes awarded and the name and address of winners for any prize with a value of $50.00 or more.
  • An itemized list of anyone who received proceeds from a raffle other than the licensee.
  • A record of the number of participants in all raffles conducted.

For a small nonprofit: the CPA-signed April 15 report is the single item most first-time Georgia raffles blow. Line up a CPA before you sell your first ticket, not after.

Georgia raffle law quick reference table

Before you sell a single ticket, make sure you know every core rule at a glance.

Rule categoryRequirementCode sectionPenalty for violation
Who can hold a raffleNonprofit, tax-exempt organizations only: churches, schools, civic organizations and related support groups, 501(c) organizations, or bona fide nonprofits approved by the sheriff16-12-22.1(a)Unlicensed operation is charged as commercial gambling under O.C.G.A. 16-12-22
Outside operatorsYour organization must be directly and solely operating the raffle. It cannot contract operations out, and cannot lend its name or identity to another entity to operate or advertise it16-12-22.1(k)(3), (k)(4)High and aggravated misdemeanor
License requirementThe sheriff must have issued your license before the raffle operates16-12-22.1(c)Charged as commercial gambling under O.C.G.A. 16-12-22
License typesStandard, or a special limited license for up to three raffles in a calendar year, which waives the fee and the annual report16-12-22.1(g)Type mismatch may void the license
License feeUp to $100.00 annually, if your sheriff requires one16-12-22.1(d)(1)Application rejected
Minimum operating historyIn existence for 24 months immediately before the license is issued16-12-22.1(d)(1)License cannot be issued
Proceeds recipientsRecord an itemized list of anyone other than your organization who received raffle proceeds, with name and address16-12-22.1(k)(1)(D)High and aggravated misdemeanor
PremisesMust be operated on premises owned, regularly used, or leased from another nonprofit16-12-22.1(h)License violation
Multi-county eventsOne license, from the county holding your state headquarters, covers raffles in multiple Georgia counties16-12-22.1(c)N/A if home county license is held
License displayLicense must be displayed conspicuously where the raffle is conducted16-12-22.1(k)(2)(B)High and aggravated misdemeanor
Age restrictionNobody under 18 may play unless accompanied by an adult16-12-22.1(i)High and aggravated misdemeanor
Volunteer compensationMaximum $30.00 per day per person, and a member may work the raffles of at most two organizations they belong to16-12-22.1(k)(6)High and aggravated misdemeanor
Record-keepingKeep gross receipts, itemized expenses with payees and receipts, prize winners, proceeds recipients and entrant counts for at least three years16-12-22.1(k)(1)High and aggravated misdemeanor
Reporting frequencyOne annual report. The statute imposes no quarterly filing, though your sheriff may add reporting conditions by rule16-12-22.1(j), (l)High and aggravated misdemeanor
Annual report deadlineOn or before April 15 each year, covering the previous year's receipts and expenditures16-12-22.1(j)High and aggravated misdemeanor
CPA requirementAnnual report must be prepared and signed by a certified public accountant, and becomes a public record16-12-22.1(j)Report invalid
Prize reportingMust list name and address of winners of any prize worth $50.00 or more16-12-22.1(k)(1)(C)Reporting violation
License expirationLicenses expire at midnight on December 31; renewal applications are filed before January 116-12-22.1(d)(1)Operating on an expired license is unlicensed operation
For-profit involvementNo contract with an individual, firm, association or corporation to operate raffles or concessions for you, and no consulting fees to anyone for raffle services16-12-22.1(k)(3), (k)(5)High and aggravated misdemeanor
Online rafflesNot permitted; the raffle must be operated on qualifying physical premises16-12-22.1(h)High and aggravated misdemeanor
Payment method (cash, check, card)Not addressed. The section contains no provision on payment instruments, so there is neither a permission nor a prohibition to rely on. Ask your sheriff, who can attach license conditions by ruleNot addressed in 16-12-22.1; see (l)Not applicable

Georgia raffle tax implications for nonprofits and winners

Winning a raffle prize feels great, until tax season shows up. Both your nonprofit and your winners may have IRS obligations depending on the prize value.

Tax obligations for raffle winners

The IRS treats raffle prizes as ordinary income. Winners must report the fair market value of any prize on their federal income tax return, whether or not they receive a Form W-2G from your organization.

Per IRS Publication 3079 and the Form W-2G instructions, your nonprofit must issue a Form W-2G to any winner whose prize is worth more than $600 and at least 300 times the ticket price. Keep this threshold in mind when structuring prize tiers: a $25 ticket with a $600 prize triggers reporting. A $25 ticket with a $400 prize does not.

If a cash prize exceeds $5,000 after subtracting the ticket cost, your nonprofit is generally required to withhold 24% federal backup withholding before paying the winner (per IRS Pub. 3079, Ch. 6). You pay the winner their prize minus the withheld amount and remit the withheld funds to the IRS. For non-cash prizes above this threshold, the winner typically pays the withholding amount to your organization before receiving the prize.

Tax obligations for your nonprofit

Your tax-exempt status does not eliminate all raffle-related tax obligations. Raffle proceeds are generally treated as unrelated business income for federal tax purposes, unless the raffle is run entirely by volunteers and not regularly carried on. Most Georgia nonprofit raffles qualify for the volunteer exception, but confirm with your CPA before filing.

Keep detailed records of every W-2G issued, all withholding paid to the IRS, and all prizes distributed. Those records back up both your sheriff's office reports and any IRS inquiries. If you run multiple raffles per year, build a simple prize-tracking spreadsheet from the start of each event. Always consult a qualified CPA for guidance specific to your organization.

For a small nonprofit: the IRS piece is where the paper trail earns its keep. If you already logged every ticket sale and every winner at $50.00 or more for the sheriff, W-2G season is a copy-and-paste job.

Can you use Zeffy to run online raffles in Georgia?

Are raffles legal in Georgia? Yes, for nonprofits, on a county sheriff's license. Can you sell the tickets online? No, because 16-12-22.1(h) ties the raffle to premises your nonprofit owns or leases. Can you sell them in person and take a card? The statute does not say, either way. It contains no provision on payment methods at all, so we are not going to tell you cards are fine. Ask your sheriff, who licenses the raffle and can attach conditions under (l), before you plan on it.

Georgia's premises requirement under 16-12-22.1(h) means online raffle ticket sales are off the table for every Georgia nonprofit, on Zeffy or any other platform.

What Zeffy carries is the rest of the raffle, including the reporting Georgia asks you for. Zeffy is free for nonprofits: no platform fee, no transaction fee, no credit card fee. Ever.

  • Zeffy cannot sell your Georgia raffle tickets online. 16-12-22.1(h) keeps the raffle on premises your nonprofit owns, regularly uses, or leases from another nonprofit, so there is no online raffle ticket sale to build in Georgia, on Zeffy or on any other platform. Whether you may take a card in person is a separate question, about payment method rather than location, and the statute does not answer it. See the payment bullet below.
  • The ledger your sheriff report is built from. Record every offline ticket sale in one place, so your April 15 report to the sheriff pulls from a real ledger rather than a shoebox of receipts, and export a CPA-ready trail of gross receipts, expenses, net proceeds, and prize-winner logs when the annual report is due.
  • Track raffle participants and prize winners in the free donor CRM, including the name and address (k)(1)(C) wants for any prize worth $50.00 or more.
  • Taking a card in person is an open question in Georgia, and we will not guess it for you. O.C.G.A. 16-12-22.1 contains no provision about payment methods: cash, checks, credit cards and debit cards go unmentioned across the whole section. That silence is not a permission, so we make no claim that card payment is available to you here. Your sheriff licenses the raffle and can attach conditions under (l), so that is where to ask, and a Georgia-licensed attorney is who to ask if you need a firm answer.
  • Email your supporters and promote the raffle from the same dashboard.

The pattern to remember for Georgia: promote online, transact offline.

Are raffles legal in Georgia?

Yes, for nonprofit, tax-exempt organizations, churches, schools, civic organizations, and related support groups. Individuals and for-profit businesses cannot legally conduct raffles in Georgia.

Can individuals or for-profit companies hold raffles in Georgia?

No. Georgia Code 16-12-22.1 limits raffle authority to nonprofit, tax-exempt organizations. Individuals or for-profit entities running a raffle can be charged with commercial gambling under O.C.G.A. 16-12-22, which carries felony penalties. Confirm current penalty figures directly with the statute or a Georgia-licensed attorney.

Can you sell raffle tickets online in Georgia?

No. Under 16-12-22.1(h), raffles must be operated on physical premises the nonprofit owns, regularly uses for non-raffle purposes, or leases from another nonprofit. A ticket bought online is not a raffle operated on those premises, and that alone closes the door on online ticket sales. You can still use free software to record offline ticket sales, track prize winners, and export a CPA-ready trail for your sheriff's April 15 report.

What is the legal difference between a raffle and a drawing?

The legal difference is whether payment is required to enter. Raffles require payment (or a promise of consideration) for a chance to win. Drawings do not. Georgia law regulates lotteries, raffles, drawings, sweepstakes, and games of chance for any nonprofit or related support group qualified to host them.

Do raffles count as gambling?

Not when they are run by a properly licensed nonprofit that follows Georgia Code. A raffle run without a license, with an expired license, or out of compliance can be prosecuted as illegal gambling.

What is the law on raffles in Georgia?

Anyone running a raffle must obtain a county sheriff's license and comply with Georgia Code 16-12-22.1. Most bona fide nonprofits qualify. Operating without a license, with an expired one, or out of compliance carries criminal penalties.

Are raffle prizes taxable income for winners in Georgia?

Yes. The IRS treats raffle prizes as ordinary income. Your nonprofit must issue a Form W-2G for prizes worth more than $600 when the prize is at least 300 times the ticket price. Cash prizes over $5,000 (after subtracting the ticket cost) generally require 24% federal backup withholding before you pay the winner. Winners report all prize income on their federal return whether or not they receive a W-2G.

Does my nonprofit need to withhold taxes on raffle prizes?

Potentially, yes. If a cash prize exceeds $5,000 after subtracting the ticket cost, your organization is generally required to withhold 24% federal backup withholding before distributing the prize. For non-cash prizes above that threshold, the winner typically pays the withholding amount to your organization before receiving the prize. Consult a CPA familiar with nonprofit tax obligations to confirm your specific requirements.

Written by
Jessica Woloszyn
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