Charitable gambling is a form of gambling run by charitable and non-profit organizations. Proceeds from the gambling are used to support the organization.
Most states do allow some form of charitable gambling. However, there are a few states that forbid it entirely, and several states that only allow certain forms of charitable gambling.
There are several different forms of charitable gambling. Some of the most common forms are:
- Raffles – Contests in which people buy tickets for a chance at a prize that is determined by a random drawing at a time, date, and place that is listed on the ticket
- Bazaars – Fair like events in which participants pay money for the chance to win certain cash or merchandise awards from games of chance. Some of the types of games that are often present at bazaars include dime pitches, "knock a block", and sometimes spinning wheel games
- "Casino Nights" – fundraisers where participants pay money for the chance to win something of value in typical casino games such as blackjack, poker, or roulette
In most states, an organization that allocates the proceeds from games of chance or skill to educational, public, civic, patriotic, or religious purposes are permitted to run some type of charitable gambling. Some common examples of such organizations are:
- Youth Groups
- Civic or Service Clubs
Although the laws regarding charitable gambling vary from state to state, most states consider the following factors in deciding whether the event is legal or not:
- The prizes – Not every state allows organizations to offer cash as an award. The states that do permit cash awards often limit the possible amount.
- Games of chance or skill – Games of skill are often given more leeway than games of chance. So, a state might forbid wheel spinning games, but allow participants to pay money to compete in a pool tournament.
- Frequency of fundraisers – Some states limit the number of times an organization can have a charitable gambling event.
- Use of proceeds -Most states that permit charitable gambling insist that most, if not all, of the proceeds go towards charitable or beneficial purposes. Organizations are usually permitted to use some of the proceeds to pay for the costs of the charitable gambling event.
- Age of participants – Most of the time, participants must be 18 or older. Some states require that the people running and promoting the charitable gambling event also be over 18.
If you are considering holding a charitable gambling event, you may want to talk to a business lawyer to learn more about the applicable laws. Because the law on charitable gambling varies from state to state, it would be in your best interest to make sure that your event will not violate any of the gambling laws in your state.