Florida Charitable Gaming Laws: Requirements, Reporting, and Penalties

Florida charitable gaming laws let qualifying nonprofits raise money through bingo, instant bingo (pull-tabs), and raffles, but only inside a narrow set of rules in Chapter 849 of the Florida Statutes. Most forms of gambling are illegal in the state, and charitable gaming is one of the few carve-outs. The rules cover who can host games, how often, how big the prizes can be, who can work the tables, and where every dollar of profit must end up. Miss any of them and the organization is looking at criminal charges, not a warning letter.

Who Can Run Charitable Games

Florida does not let every nonprofit host games. An organization has to meet three conditions at the same time. It must hold a federal income tax exemption under Section 501(c) of the Internal Revenue Code (or Section 528, which covers some homeowner associations). It must actively engage in charitable, civic, community, benevolent, religious, or scholastic work. And it must have been in existence and active for at least three years before conducting any games.¹ That three-year waiting period is the condition newer organizations trip over most often.

Location matters too. The organization has to be located in the same county as the game, or within 15 miles of where the game takes place.¹ A charity based across the state cannot drive in to run a bingo night at a rented hall.

Residential associations — condominium, cooperative, homeowners’, and mobile home owners’ associations, plus certain groups of residents in mobile home or RV parks — can also run bingo, but under a different profit rule described later.

What Games Are Allowed

Only three categories qualify: traditional bingo, instant bingo, and raffles (which the statute calls “drawings by chance”). Poker, roulette, craps, slot machines, and other casino-style games are off the table. Running an unauthorized game is a crime, not a regulatory slip.

Bingo

A qualifying organization can host bingo no more than two days per week. A jackpot cannot exceed $250 in cash or its equivalent, no more than three jackpots can be awarded in a single session or day of play, and every other game prize is capped at $50.¹ These ceilings are low on purpose. The legislature treats charitable bingo as a fundraising tool, not an entertainment product.

Instant Bingo (Pull-Tabs)

Instant bingo uses pre-printed tickets that reveal a winning or losing combination when the player peels back the cover. It is not subject to the two-day-per-week limit, but it carries its own rules. Each ticket can cost no more than $1, and discounts for buying multiple tickets are prohibited. Each “deal” — a set of up to 4,000 tickets — must pay out at least 65 percent of total receipts as prizes. Every deal must be accompanied by a posted “flare,” a placard showing the game name, manufacturer, ticket count, prize structure, and cost per play. Tickets have to meet North American Gaming Regulators Association standards and be manufactured so a player cannot tell whether a ticket is a winner before opening it.¹

Raffles

Raffles sit under a separate statute, Section 849.0935, with its own eligibility and disclosure rules. The organization has to have complied with Chapter 496, Florida’s solicitation of contributions law, as well as the raffle statute itself. All brochures, advertisements, tickets, and entry forms must conspicuously state that no purchase or contribution is necessary to enter or win.² A suggested donation is fine; a required one is not. Leaving the “no purchase necessary” language off tickets or ads is itself a second-degree misdemeanor, even if everything else about the raffle is honest.

Who Can Work the Games and Who Can Play

Every person involved in running a bingo game or instant bingo session must be a bona fide member of the sponsoring organization and a resident of the community where the organization is located. No one running the game may receive any form of compensation — not a salary, not a stipend, not a free meal as a thank-you. The organization has to designate up to three members to be in charge of games, and at least one of those designated members must be physically present for the entire session. A notice naming the organization and the designated members must be posted in a visible spot at the venue. A caller cannot also play in the game they are calling.¹

No one under 18 may play bingo or instant bingo, or help run one in any capacity.¹

Where the Money Has to Go

Charitable gaming exists to channel money toward charitable purposes, and the profit rules are not negotiable. The entire proceeds from bingo and instant bingo, minus only the actual business expenses for items essential to running the game, must go to the organization’s charitable, civic, community, benevolent, religious, or scholastic activities. The statute says “in no case” may net proceeds be used for any other purpose.¹

The allowable deduction is narrow. An organization can subtract the cost of bingo cards, daubers, pull-tab tickets, and similar supplies directly used in the game. It cannot deduct rent, utilities, staff time, advertising, or general overhead. This is where many groups overestimate their margins, because the “articles essential to the game” limit is taken literally.

Residential associations follow a different formula. They must return net proceeds to players as prizes after subtracting actual operating expenses. Any leftover money can be donated to a qualifying 501(c) charitable organization, but it cannot be kept for general association use the way a charity retains its proceeds.¹

Diverting proceeds to benefit individual members, officers, or employees breaks the statute and can trigger federal consequences too. Under Internal Revenue Code Section 4958, when a tax-exempt organization gives an insider an economic benefit worth more than what the organization received in return, the IRS treats it as an “excess benefit transaction.” The insider has to repay the excess benefit plus interest at no less than the applicable federal rate, and the IRS can layer excise taxes on top.³ In extreme cases, the organization can lose its tax-exempt status, which would also strip its eligibility to run charitable gaming in Florida.

Registration and Reporting

State Registration

Any charitable organization that solicits contributions in Florida — gaming included — has to register with the Florida Department of Agriculture and Consumer Services (FDACS) before soliciting, unless it qualifies for an exemption.⁴ Registration renews annually.

A limited exemption exists for small organizations receiving less than $50,000 in total contributions during the fiscal year, so long as all fundraising is carried out by uncompensated volunteers, members, or officers, no part of the organization’s assets or income benefits any officer or member, and no professional fundraiser or solicitor is used. Even exempt small organizations have to submit an annual information form to FDACS with their name, address, tax-exempt status, fiscal year end date, and the names of those responsible for contribution custody and distribution.⁵ If contributions unexpectedly reach $50,000 during the year, the organization has 30 days to register.

Local Oversight

County-level law enforcement, usually the sheriff’s office, also oversees charitable gaming. Many counties require separate local registration or advance notification. Because the specifics vary by county, contact the sheriff’s office in the county where games will be held well before the first event.

Federal Reporting

Organizations reporting more than $15,000 in gross gaming income have to complete Schedule G and attach it to IRS Form 990.⁶ Schedule G breaks out professional fundraising, events, and gaming in detail.

Organizations paying individual prizes also have to watch Form W-2G. For bingo and slot machine winnings, the general federal reporting threshold is $1,200.⁷ Florida’s $250 jackpot ceiling means most charitable bingo prizes stay well below it, but instant bingo prizes shown on the flare are not held to that cap, so the W-2G obligation can still come into play.

Federal Tax on Gaming Income

Nonprofits generally owe tax on income from activities unrelated to their exempt purpose, and gaming can fall into that bucket. Two exclusions usually protect compliant Florida charitable gaming.

Under IRC Section 513(f), bingo games are excluded from “unrelated trade or business” as long as the game is not the kind ordinarily carried out on a commercial basis and does not violate state or local law.⁸ Florida’s volunteer-labor, low-prize, limited-frequency rules generally meet that test. But break one state-law requirement — paying a caller, say, or exceeding the prize cap — and the federal exclusion collapses, making the whole session’s revenue taxable.⁹

Under IRC Section 513(a)(1), any trade or business is excluded from “unrelated” status when substantially all the work is done by uncompensated volunteers.⁹ Because Florida already bans compensating anyone who runs charitable bingo, organizations following state law typically satisfy this one too. Raffles and other drawings by chance do not get the bingo-specific exclusion in Section 513(f) and can produce taxable income if they are regularly carried on instead of run as occasional fundraisers.

Penalties for Violations

Consequences depend on which statute was broken, and they escalate for repeat offenders.

For bingo and instant bingo, a willful and knowing violation of any provision of Section 849.0931 is a first-degree misdemeanor, carrying up to one year in jail.¹ A second or subsequent bingo offense becomes a third-degree felony, punishable by up to five years in prison.¹⁰ That felony exposure is written directly into the bingo statute.

For raffles, a violation of the drawings-by-chance statute is a second-degree misdemeanor, punishable by up to 60 days in jail.²¹⁰ Selling raffle tickets without the required “no purchase necessary” disclosure carries a fine-only penalty under the same provision.

A violation can also disqualify an organization from future charitable gaming and, as above, produce unrelated business income tax liability on the revenue from every noncompliant session. For a group that relies on gaming revenue to fund its charitable work, one compliance failure can cascade into problems that outlast the criminal case itself.

1
Florida Senate. Florida Code 849.0931 – Bingo Authorized; Conditions for Conduct
2
Florida House of Representatives. Florida Code 849.0935 – Charitable, Nonprofit Organizations; Drawings by Chance; Required Disclosures; Unlawful Acts and Practices; Penalties
3
Internal Revenue Service. Intermediate Sanctions – Excess Benefit Transactions
4
Florida Department of Agriculture and Consumer Services. Solicitation of Contributions
5
Online Sunshine. Florida Code 496 – Solicitation of Contributions Act
6
Internal Revenue Service. Instructions for Schedule G (Form 990)
7
Internal Revenue Service. Instructions for Forms W-2G and 5754
8
Office of the Law Revision Counsel. 26 USC 513 – Unrelated Trade or Business
9
Internal Revenue Service. Exempt Organization Gaming and Unrelated Business Taxable Income
10
Online Sunshine. Florida Code 775.082 – Penalties; Applicability of Sentencing Structures; Mandatory Minimum Sentences