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Texas Raffle Laws for Nonprofits: What's Legal in 2026
August 2, 2026
⚡TL;DR — The Short Answer
Verdict: No, you can't sell Texas raffle tickets online. Raffles are legal for qualified Texas nonprofits, but the Charitable Raffle Enabling Act (CREA) bars statewide ticket sales, and the Texas Attorney General's office says it is generally thought that statewide includes the Internet. On whether you can then take a card for that in-person ticket, CREA says nothing at all. There is no payment-instrument provision anywhere in Tex. Occ. Code ch. 2002, so confirm your payment setup with your counsel.
What works: In-person ticket sales at your event. Promoting the raffle on your own website, in a newsletter to identified supporters, and on your social channels. Up to 4 raffles per calendar year.
What doesn't: Selling or offering tickets to a statewide audience online. Cash prizes of any kind. Paying anyone to organize, conduct, or sell tickets for the raffle. Purchased prizes above $75,000 (or above $750,000 for a purchased residential dwelling).
Best for: Qualified 501(c) nonprofits with a 3+ year history, qualified religious societies (10+ years in Texas), qualified volunteer fire departments and EMS, and professional sports team charitable foundations.
Worth considering if: You can staff the raffle with volunteers or with members whose raffle work is a minimal part of their existing duties, you can sell tickets in person, and you can keep tight records. If not, a straight donation appeal or a ticketed event will raise more per volunteer hour with far less legal exposure.
Raffle laws vary by state. Texas is one of the trickier ones: raffles are broadly legal for qualified nonprofits, but the Charitable Raffle Enabling Act's statewide-sale ban functionally rules out selling tickets online. This guide walks through who qualifies, what the statute actually says, how to run a compliant Texas raffle, and where Zeffy fits when it can't sell your tickets.
the award of one or more prizes by chance at a single occasion among a single pool or group of persons who have paid or promised a thing of value for a ticket that represents a chance to win a prize.
Raffles in Texas are legal only when a qualified nonprofit is running them. Individuals and for-profit businesses cannot hold raffles in Texas.
Key legal definitions
Raffle: a game of chance where participants buy a ticket for a chance to win a prize.
CREA: governs raffles run by qualified nonprofits.
Professional Sports Team Charitable Foundation Raffle Enabling Act: a separate statute that permits professional sports team charitable foundations to conduct raffles under their own rules.
For a small Texas nonprofit: CREA is the law you actually have to follow. The sports-foundation act only matters if you're a foundation tied to a professional sports team with a Texas venue.
Who can host a raffle in Texas
To host a raffle in Texas, you must be a qualified tax-exempt nonprofit in one of these categories:
Qualified religious society: must have existed in Texas for at least 10 years.
Qualified volunteer fire department: must operate firefighting equipment, provide firefighting services, and not pay members beyond nominal compensation.
Qualified volunteer emergency medical service: must not pay members beyond nominal compensation.
Qualified 501(c) tax-exempt nonprofit: must have existed for at least three years.
Professional sports team charitable foundation: must be a 501(c)(3) associated with a professional sports team whose home venue (or rodeo venue) is in Texas, and must have existed for at least three years.
Individuals and for-profit businesses cannot hold raffles in Texas.
For a small nonprofit: the eligibility bar is real but not high. If you're a 501(c) that's been around three years, you qualify. Check your own status with the Texas Secretary of State before you plan the raffle.
How does a nonprofit register for a raffle in Texas
Good news: you do not have to register or obtain a license or permit to host a raffle in Texas. There's no state permit and no state registration fee. What you do need is your tax-exempt status in order and clean records with the IRS and the Texas Secretary of State.
Steps to make sure you qualify
File Articles of Incorporation with the Texas Secretary of State.
Obtain IRS 501(c) tax-exempt status.
Maintain proper documentation of raffle proceeds, expenses, and prize records.
For a small nonprofit: no permit, no state filing fee, no application to submit. The compliance work happens in how you run the raffle, not in getting permission to run it. Confirm your own permit and registration position with your county clerk before you sell tickets, especially if you plan to post a bond.
Texas fundraising laws: the full breakdown
Raffle planning
How many raffles can you hold
Most qualified organizations can hold up to 4 raffles per calendar year. Professional sports team foundations operate under a different rule and may conduct raffles at each preseason, regular season, and postseason home game, and at qualifying rodeo events.
Ticket and prize rules
Ticket requirements
Each raffle ticket must include:
The name of the organization conducting the raffle.
The organization's address, or the address of a named officer.
The ticket price.
A description of each prize valued at more than $10.
Under Tex. Occ. Code 2002.056(a), a prize may not be money. That covers coins, paper currency, and negotiable instruments, including certificates of deposit. U.S. savings bonds and prepaid credit cards are permitted as prizes.
Purchased-prize value limits under Tex. Occ. Code 2002.056:
Each purchased prize may not exceed $75,000.
For a purchased residential dwelling, the cap is $750,000, per Tex. Occ. Code 2002.056(b-1).
You must either have the prize in your possession before you start selling tickets, or post a bond with the county clerk of the county where the raffle will be held. CREA doesn't specify the type of bond, but county clerks generally expect a surety bond. Confirm the exact requirement with your own county clerk before you sell a ticket.
For a small nonprofit: the safe path is to line up a donated prize (no value cap, no purchase to justify) and have it in hand before ticket #1 goes out the door. The bond route works, but it's paperwork most small orgs don't need.
Promotion and how to sell raffle tickets
Advertising rules
Under Tex. Occ. Code 2002.054(a)(2), the organization may not "promote or advertise a raffle statewide, other than on the organization's Internet website or through a publication or solicitation, including a newsletter, social media, or electronic mail, provided only to previously identified supporters of the organization."
In practice, that means the CREA-allowed advertising channels are:
Your organization's own website.
Newsletters, publications, and solicitations shared only with previously identified supporters.
Under Tex. Occ. Code 2002.054(a)(3), the organization may not "sell or offer to sell tickets for a raffle statewide." The Texas Attorney General's office states that "statewide" has not been defined or interpreted in any known court proceeding or Attorney General Opinion, “but it is generally thought that statewide would include the Internet.” Treat an online checkout open to the public as sitting inside the bar. Focus on in-person selling channels.
One clarifier: what triggers the risk under 2002.054(a)(3) is statewide reach. The provision bars selling or offering to sell raffle tickets statewide, which is why an online checkout open to the public is fatal. Before you accept a card for an in-person ticket, check with your counsel that your payment setup sits inside CREA.
How you use raffle funds
Where can raffle proceeds go
All proceeds from the raffle must be used for the organization's charitable purposes as defined by CREA. Misuse of funds can result in criminal penalties.
Compensation rules
Under Tex. Occ. Code 2002.054(b), the organization may not compensate a person directly or indirectly for organizing or conducting a raffle, or for selling or offering to sell tickets. There is a narrow allowance: a member the organization employs can help run the raffle, but only if that raffle work is a minimal part of their existing duties. Confirm the exact statutory wording before you rely on it for a specific employee.
This rule also has an important consequence for third-party vendors and platforms: you can't pay someone to run the raffle for you. Zeffy is free, so no compensation flows from the organization to Zeffy. That distinction is worth naming plainly, but it doesn't change the answer on statewide online sales, which are barred regardless under 2002.054(a)(3).
For a small nonprofit: staff the raffle with volunteers. If a paid staff member helps, it has to be a small slice of what they already do, not a project you assign them on top of their job.
Casino and poker nights
Unlike raffles, there's no nonprofit exception to host casino or poker night fundraising events. These fall under Texas gambling law, Chapter 47 of the Penal Code, which applies to nonprofits and for-profits alike.
Poker or casino activities held in a private place (where the public does not have access) are allowed, but all proceeds must be redistributed among the players. The host cannot keep any portion of the winnings.
Recent legal updates to be aware of
HB 2757 (effective June 15, 2021): increased the purchased-prize cap from $50,000 to $75,000, and raised the number of allowable raffles per year from 2 to 4.
Professional sports team foundations only
HB 2168 (effective June 8, 2021): amends the Professional Sports Team Charitable Foundation Raffle Enabling Act only. It does not apply to ordinary nonprofit raffles under CREA. A separate but common reader question: CREA itself imposes no payment-instrument restriction. What makes online selling risky in Texas is the 2002.054(a)(3) bar on statewide paid ticket sales, not the use of a card.
Gambling violation: running an unauthorized raffle is a Class C misdemeanor, punishable by a fine of up to $500.
More serious consequences: if the activity is charged as organized criminal activity (Title 11 of the Texas Penal Code), it can rise to a state jail felony, with a fine of up to $10,000 and a possible sentence of up to two years in a state correctional facility.
Federal penalties: federal violations can carry a prison sentence of up to 5 years and fines of up to $250,000 for individuals or $500,000 for organizations.
Legal actions: county attorneys, district attorneys, or the Office of the Attorney General may bring an action in state court to stop a violation.
For a small nonprofit: this is why the "just try it online and see" approach is a bad idea. The downside is criminal exposure, not a warning letter.
The quick checklist for a successful Texas raffle
Confirm your eligibility
You are one of the following: a 501(c) nonprofit that's been around for at least 3 years, a qualified religious society in Texas for 10+ years, or a qualified volunteer fire department or EMS that operates without paid members beyond nominal compensation.
Plan your raffle calendar
You can hold up to 4 raffles per calendar year.
Set the prize-award date before you sell tickets.
If you must change the prize-award date, set a new date within 30 days.
If prizes aren't awarded within that window, refund all ticket purchases.
Prepare your raffle tickets
Each ticket must clearly show:
Organization's name and address.
Ticket price.
Description of any prize valued over $10.
The date the prize(s) will be awarded.
Choose your prizes
No cash prizes ( 2002.056(a)).
Purchased prizes cap at $75,000, except a purchased residential dwelling, where the cap is $750,000 per Tex. Occ. Code 2002.056(b-1).
Donated prizes have no statutory value cap. Keep official receipts on file.
Possess the prize before selling tickets, or post a bond with the county clerk. Check the exact bond requirement with your own county clerk.
Promote your raffle and start selling
Stick to the CREA-allowed channels:
Your own website.
Email, newsletters, and social media targeted at previously identified supporters.
In-person flyers and event promotion.
Handle staffing and ticket sales correctly
Volunteers can help, but no one is compensated for organizing or conducting the raffle.
A member the organization employs can assist only if raffle work is a minimal part of their duties ( 2002.054(b)).
Only people authorized by your organization sell tickets.
Tickets are not sold online to a statewide audience. In-person is the safe channel. CREA does not address payment methods at all, so clear your payment setup with your counsel rather than reading the silence as permission.
Keep everything organized
Track all ticket sales, expenses, and profits.
Keep your reporting in one place, accessible at all times.
Communicate clearly with participants about the rules.
Use your records to plan future raffles.
Can you use Zeffy to run online raffles in Texas?
No. You can't use Zeffy to sell raffle tickets online in Texas. Tex. Occ. Code 2002.054(a)(3) bars statewide ticket sales, and the Texas Attorney General's office says it is generally thought that statewide includes the Internet. A Texas nonprofit that sells raffle tickets on any online checkout to the public is outside CREA, and the exposure is criminal, not administrative.
Three questions decide how you run this. Are raffles legal in Texas? Yes, for qualified nonprofits, and there is no state permit to apply for. Can you sell the tickets online? No. 2002.054(a)(3) bars selling or offering to sell raffle tickets statewide, and the Attorney General's office says statewide is generally thought to include the Internet. Can you sell them in person and take a card? The Act does not say.
That third answer deserves more than a shrug, because it is the one nonprofits ask us about most. The Charitable Raffle Enabling Act contains no payment-instrument provision at all. Across all fourteen sections of Tex. Occ. Code ch. 2002, the words "cash" and "card" do not appear once. There is no list of permitted payment forms to satisfy, and no prohibition to fall foul of. What the Act does restrict is how far your tickets may reach, under 2002.054(a)(3), and who may be paid to sell them, under 2002.054(b): "the organization may not compensate a person directly or indirectly for organizing or conducting a raffle or for selling or offering to sell tickets to a raffle."
So in Texas the card was never the problem. The reach is, and who gets paid is. Silence cuts both ways, though. Because the Act does not address the payment instrument, there is no provision permitting a card either, so describe your payment setup to your own counsel and get their answer before you accept one for a raffle ticket. Everything below works whichever way that answer lands, because none of it turns on it.
The tickets themselves are sold face to face. Zeffy holds the ticket log and everything you build around the drawing.
Here's what you can do with Zeffy in Texas, all at no cost (Zeffy is trusted by 100K+ nonprofits who've raised $2B+ on the platform):
Keep the whole face-to-face ticket sale in one log. The sale happens at the table: a numbered stub in one hand, whatever payment your counsel has cleared in the other. Record each sale in Zeffy's free donor CRM as the shift goes, stub number against buyer name, amount and date. At the end you export one buyer list and one revenue total, instead of reconciling a clipboard against a cash box.
Tag your ticket buyers so next year starts warm. Mark the winners, build a "raffle 2027" segment, and keep every buyer next to the rest of that supporter's giving history instead of in a spreadsheet you rebuild from stubs each year.
No. Qualified Texas nonprofits do not need to register their raffles with the state. There is no state permit, no application, and no registration fee. Focus your planning time on eligibility, prize rules, and record-keeping.
There's no magic number. It depends on your organization's goals, resources, and donor base. Some nonprofits do better with a few large events, others with several smaller campaigns. Diversifying, like pairing a raffle with a ticketed event, is a strong way to reach new supporters and grow revenue. Find the mix that works for your team and mission.
Under CREA, if the raffle prizes cannot be awarded on the original date, the organization must set a new date within 30 days. If the prizes are not awarded within that window, the organization must refund the ticket purchasers. The Professional Sports Team Charitable Foundation Raffle Enabling Act does not address this scenario, so check which statute applies to your raffle.
Yes. There is no permit or state registration fee for a qualified Texas nonprofit to run a raffle. Your out-of-pocket cost depends on prize sourcing, printing, and any platform you use to support the raffle around it. Zeffy is free for nonprofits, so there is no platform cost when you use it for the pieces you can run online in Texas: donation forms, event ticketing for the drawing event, supporter email, and recording offline ticket sales in the CRM.
A nonprofit does not pay sales tax on raffle tickets, because the sale of a raffle ticket is treated as the sale of the right to win an item rather than a taxable good.
Here’s a recap of all the links and documents mentioned in this article:
Look for people who attend related events, follow relevant Facebook groups, or subscribe to aligned newsletters.These aren’t just potential donors—they’re your future advocates.
Look for people who attend related events, follow relevant Facebook groups, or subscribe to aligned newsletters.These aren’t just potential donors—they’re your future advocates.
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