Because it is a game of chance that requires you to pay to enter, raffles are regulated as a form of gambling in many jurisdictions. Many U. S. states limit raffles to established (not brand-new) charitable organizations, churches, or volunteer organizations. Check whether you need to pay taxes on the vehicle and whether you need to register it before the raffle. You may need a gaming license or similar state registration to hold a raffle. For example, in California, you must register your raffle with the state’s Attorney General. [2] X Research source
You might want to hold your car raffle online, on a dedicated raffle website or on a social media platform (like Facebook), but the legality of this will still be governed by the raffle rules where you live.
Listing a minimum age for ticket purchasers. Requiring purchasers to be a resident of the state or country where you’re holding the raffle. Setting a maximum number of tickets available to a single purchaser. Prohibiting anyone closely affiliated with your organization from buying tickets. Detailing how taxes will be handled (for instance, stating that the winner will be responsible for all taxes).
If you can’t get a donated car from a dealer, aim to get donations to cover the cost of buying a car to raffle. In other words, recruit people and organizations to donate to your organization so you can use the proceeds to buy a car.
Your organization’s background. Provide details on when you were established, how much you have raised for your cause, etc. How you will showcase your sponsors. For example, you might tell the dealer: “We’ll feature your dealership’s name prominently in all marketing materials and on the individual tickets—that’s a lot of free advertising for you!” How you will monitor and evaluate the raffle. For example, does your organization have an accountant or bookkeeper who will oversee the raffle and keep track of the money raised? How you will use the money raised. For example: “All money raised will directly support families of patients in Children’s Hospital, and I know that’s a cause that’s near and dear to your heart. ”
For example, if you are an environmental charity, then you might want to raffle a hybrid vehicle. Or, If your target audience is young professionals, then you might want something more sporty. However, if your audience consists mostly of families, then you may choose to raffle a minivan or family-friendly SUV.
How much money you hope to make. For a charity car raffle, a reasonable goal is to make twice as much as the sale price of the car—for instance, to make $76,000 USD by raffling a $38,000 USD car. The costs associated with printing, advertising, etc. Since charity car raffles rely heavily on volunteers (and, hopefully, a donated car), your expenses should be limited to the cost of printing tickets and for advertising. [8] X Research source How many tickets you think you can sell. Base this on the number of volunteers you have to sell tickets as well as the size of your target community. Print up about 33% more tickets than your estimate just in case! The price to charge per ticket. Car raffle tickets usually run in the $25-$50 USD range. Use your profit goal, expenses, and anticipated ticket sales to make the calculation:[9] X Research source For instance, say your profit goal is $76,000 USD, your expenses for printing and advertising are $4,000 USD, and your ticket sale estimate is 2,300 (out of 3,400 printed). In order to make $80,000 USD (profit plus expenses), you’ll need to sell your tickets at $35 USD apiece.
For instance, say your profit goal is $76,000 USD, your expenses for printing and advertising are $4,000 USD, and your ticket sale estimate is 2,300 (out of 3,400 printed). In order to make $80,000 USD (profit plus expenses), you’ll need to sell your tickets at $35 USD apiece.
Approach the process of getting prizes (or cash) donated from businesses like you did getting the car donated. Craft a personalized “pitch” for each business that lays out your charity’s mission and specifies how making a donation will materially benefit them (such as through the advertising you’ll provide for them).
The tickets should contain the name of your organization, any sponsors, and the time, date, and location of the raffle. Make sure to include the price, too! Ensure that the tickets are individually numbered, both on the section you’ll keep for the drawing and the section the buyer keeps.
Include relevant info (ticket cost, drawing date, major sponsors, etc. ) plus a prominent picture of the car in your advertising. Advertise the raffle on your organization’s website and social media accounts, and also post flyers on community bulletin boards (at the library, grocery store, etc. ). Put together a motivated, trustworthy volunteer sales force and give each team member a (reasonable) set number of tickets to sell by the deadline. Set up sales tables, staffed by energetic, knowledgeable volunteers, at high-traffic areas such as outside major retailers that see a lot of foot traffic. Get permission first, of course.
Invite the news media. Ask your local newspapers, radio stations, and television stations to attend the drawing. Ask a local celebrity to draw the winning ticket. This can entice the media and the public to attend. Mention this person in your advertising. Take pictures of the raffle. Post these to your website and social media accounts, and send them to local news media as well. Make the drawing itself extra flashy! Have the people involved in drawing the winning ticket dress up, have music, balloons, and confetti at the ready, and use a big raffle drum to mix up the tickets before pulling one.
The process of transferring the car’s title (and thus legal ownership) to the winner varies based on where you live. Expect some paperwork and fees—but, if you’re lucky, you might be able to complete the process online![15] X Research source In the U. S. , you may have to file a W-2G form with the IRS if the value of the car was 300 times the price of the raffle ticket. [16] X Trustworthy Source Internal Revenue Service U. S. government agency in charge of managing the Federal Tax Code Go to source You will also have to withhold U. S. federal taxes on the car if it is worth more than $5,000 and more than 300 times the ticket price. You can handle withholding taxes in a few ways:[17] X Research source Ask the winner to hand over the taxes before you turn over the car. If they can’t or won’t do this, let the winner choose to take a cash equivalent and deduct the taxes from that amount. Increase the prize amount to include the taxes due—in other words, the winner gets both the car and the amount of money required to cover the taxes.
