FundSvcs Community

Expand all | Collapse all

Raffle?

  • 1.  Raffle?

    Posted 8 days ago
    The organization I work for is having a fundraiser. However, it seems to me it is a raffle without purchasing a raffle ticket. Below is the actual verbage for this fundraiser.  I would appreciate any input on how this should be handled, recorded.  To me, they are donating, but in the hopes they will recieve football tickets.

    "Support the HPER Department by donating to the "9066 Campaign."  9066 is the P.O. Box number for Daniel Gymnasium, and you can donate any amount using the digits "9066" ex. $9.00, $60.00, $6,900.00, $96.00, 96 cents, etc. No amount is too small!  Funds will be used to support the mission of the Department of Health, Physical Education and Recreation.

     

    The following prizes will be awarded:

     

    Highest Donor: The highest donor will receive two premium tickets and a parking pass to The Washington Football Team vs. Seattle Seahawks game on November 29. *Winner must follow all The Washington Football Team COVID-19 stadium policies and protocols.

     

    Sept. 26, 2021: First Donor after Midnight: First Donor who gives after Midnight (EST) on Sept. 26

     

    Wednesday, Sept. 29: Hump Day Happy Hour:  One donor who makes a donation between 4:00 p.m. - 7:00 p.m. will be randomly selected for a prize."

     

    Friday, Oct. 1, 2021: Last Donor at 11:59 p.m. (EST)



    ------------------------------
    Susan Moening
    Donor and Data Specialist
    Virginia State University
    smoening@vsu.edu
    ------------------------------


  • 2.  RE: Raffle?

    Posted 8 days ago
    Sounds like benefits received for those few donors and not a raffle. 


    Tina Gorski-Strong
    Chief Advancement Officer
    Bancroft School





  • 3.  RE: Raffle?

    Posted 8 days ago
    You are correct.  The payments are for games of chance and therefore not charitable or deductible donations.

    You can argue that the highest donor award is not part of the raffle/drawing.  But any gift eligible for a drawing is not tax-deductible.

    And while you did not include the entire document, no one can participate in any of this if they pay through a DAF or family foundation.

    John

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987






  • 4.  RE: Raffle?

    Posted 8 days ago
    Thank you, John.  So whatever the amount an individual donated, the entire amount would not be tax-deductible because it is a game of chance?

    ------------------------------
    Susan Moening
    Donor and Data Specialist
    Virginia State University
    smoening@vsu.edu
    ------------------------------



  • 5.  RE: Raffle?

    Posted 8 days ago
    Yes - but only for those where donors are entering a game of chance.  That clearly covers the hump-day drawing.  I am not sure about the first and last donors.  Those sound chancy to me but I would get a legal opinion.

    John

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987







  • 6.  RE: Raffle?

    Posted 8 days ago
    Hi Susan,

    This is kind of a mess for recording! 

    Regarding the highest donor and the tickets to the NFL game, if the vale of the ticket prize is posted to all bidders, and the winning donor exceeds the price of the tickets, I think that you can treat that like a regular charity auction, and provide a tax deduction for the amount contributed over the ticket value. If the price is not posted, the total amount contributed is non-gift. In terms of the rest of the donors, I don't think the prize defeats the charitable intent, since your bid is forfeit no matter what (it's an "all-pay" auction). At no point does any donor purchase a chance at winning - this is a non-probabilistic prize - so I don't think this would qualify as a game of chance at all. I would certainly feel differently if the highest bid was small, though, and I'd feel much more comfortable with this analysis if the 'current high bid' was displayed to donors. If you are showing that 'highest bid' then certainly any donor giving less than that amount is simply making a normal contribution. They will not win tickets and they know they will not win tickets. Even if you don't post the highest bid, I'm not sure that irrational hope defeats charitable intent. Unlike a raffle, where donors do buy an actual chance to win, a chance that has an expected monetary value and is an asset, in this situation, a donor is not buying any kind of right at all. 

    Regarding the First Donor and Last Donor, I feel similarly. Nearly all donors are not giving at a qualifying time, so the existence of these prizes are irrelevant to them. It really only applies to donors giving in a very compressed time period right next to those moments. You can probably treat anyone giving after the first hour and prior to the last hour as charitable, and treat the others as non-charitable. I'm not convinced that these are games of chance either, to be honest.

    The Hump Day Happy Hour is clearly a raffle, and anyone giving in that time period should not receive charitable credit.

    I would certainly want to consult with legal here, though. Virginia's gaming regulations only permit "raffles, bingo, network bingo, instant bingo games, and Texas Hold'em poker tournaments" and there are specific rules about how to conduct a raffle that involves using physical tickets. It may be that the type of raffle described in Hump Day Happy Hour is not ok with the Commonwealth of VA


    Thank you,
    Isaac Shalev
    Data Strategy Expert
    Sage70, Inc.
    (917) 859-0151
    isaac@sage70.com

    Schedule a 30-minute consultation now: