Illinois Raffle Laws: Complete Legal Guide for Nonprofits

Illinois has comprehensive raffle regulations under the Raffles and Poker Runs Act, allowing both traditional and online raffles with proper licensing. This guide covers everything nonprofits need to know about conducting legal raffles in the Prairie State.

⚠️ Legal Disclaimer: This guide provides general information about Illinois raffle laws as of 2025. Laws change frequently. Always consult with legal counsel or your local government for current requirements specific to your situation.

Illinois Raffle Laws: Quick Facts

Who Can Hold Raffles: Licensed nonprofit organizations
License Required: Yes, from local government
License Types: Class A, B, C, and Special Limited
Prize Limits: Varies by license class
Online Raffles: Allowed with restrictions
Poker Runs: Allowed with license
Minimum Existence: 5 years (with exceptions)
Key Innovation: Online raffle platform allowed

Who Can Conduct Raffles in Illinois?

Illinois law allows only specific types of nonprofit organizations to conduct raffles:

Eligible Organizations Must Be:

  • Bona fide religious, charitable, labor, business, fraternal, educational, veterans', or other bona fide not-for-profit organizations
  • Operating without profit to their members
  • In existence continuously for 5 years (with exceptions)
  • Having been during that period engaged in carrying out their objects

Five-Year Rule Exceptions

The following can qualify without 5 years of existence:

  • Local government subdivisions
  • Law enforcement agencies
  • Fire protection agencies
  • Organizations affiliated with schools (if school has existed 5+ years)

License Types and Limits

Class A License

Unlimited Operations:

  • No limit on number of raffles
  • No limit on gross receipts
  • No limit on prize values
  • Valid for one year
  • Higher bond/insurance requirements

Class B License

  • Maximum $1,500,000 aggregate gross receipts per year
  • Maximum $250,000 maximum retail value per prize
  • Valid for one year

Class C License

  • Maximum $150,000 aggregate gross receipts per year
  • Maximum $150,000 maximum retail value per prize
  • Valid for one year

Special Limited License

  • One raffle per 12-month period
  • Maximum $50,000 gross receipts
  • Maximum $50,000 prize value
  • For organizations that don't meet regular requirements

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Online Raffles in Illinois

Illinois is one of the few states that explicitly allows online raffles:

Online Raffle Requirements:

  • Must use a licensed raffle provider platform
  • Platform must verify participant age and location
  • All participants must be Illinois residents
  • Payment processing must be secure
  • Electronic records must be maintained
  • Drawing must still be conducted in Illinois

Key Online Features Allowed

  • Electronic ticket sales
  • Credit card payments
  • Digital ticket delivery
  • Online drawing broadcasts
  • Electronic winner notification

Conducting Your Raffle: Step-by-Step

Illinois Raffle Compliance Checklist

  • Verify organization meets eligibility requirements
  • Determine appropriate license class needed
  • Apply for license with local government
  • Obtain required fidelity bond or insurance
  • Set up separate raffle bank account
  • Design tickets with mandatory information
  • Establish sales procedures and controls
  • Plan public drawing in Illinois
  • Create record-keeping system
  • Prepare for post-raffle reporting

Required Ticket Information

Each raffle ticket must contain:

  • Name and address of sponsoring organization
  • License number and licensing municipality
  • Sequential ticket number
  • Price of the ticket
  • Date, time, and location of drawing
  • Prizes to be awarded
  • Statement: "Need not be present to win"

Operational Requirements

  • Only members can manage and operate raffle
  • No compensation for raffle work
  • Must maintain detailed financial records
  • Drawing must be in Illinois
  • Winners need not be present

Financial Management & Reporting

Banking Requirements

Separate Raffle Account:

  • Must establish separate checking account
  • All proceeds deposited within 7 days
  • Clear audit trail required
  • Two authorized signatures recommended
  • No commingling with other funds

Use of Proceeds

  • Must be used for organization's lawful purposes
  • Cannot benefit any individual member
  • Reasonable expenses allowed
  • Must maintain documentation

Reporting Requirements

  • Summary report: Due within 30 days of raffle
  • Contents: Gross receipts, prizes awarded, profit, distribution
  • Records retention: Minimum 3 years
  • Available for inspection: By licensing authority

Poker Runs in Illinois

Illinois specifically authorizes poker runs with proper licensing:

Poker Run Requirements:

  • Same licensing requirements as raffles
  • Must follow predetermined route
  • Random element must determine winners
  • Cannot be based solely on skill
  • Must comply with all raffle regulations

Common Violations and Penalties

Warning: Violations are Class C misdemeanors, punishable by fines up to $1,500 and/or imprisonment up to 30 days. Organizations can lose licensing privileges.

Common Violations

  • Operating without proper license
  • Exceeding license class limits
  • Improper use of proceeds
  • Poor financial record keeping
  • Compensating workers
  • Failing to file reports
  • Selling to out-of-state residents (online)

Best Practices for Illinois Raffles

  1. Choose Right License: Don't under-license to save fees
  2. Bond Early: Fidelity bonds can take time to obtain
  3. Leverage Online: Take advantage of Illinois's progressive online rules
  4. Document Everything: Illinois requires detailed records
  5. Local Relationships: Work closely with licensing municipality
  6. Professional Platform: Use licensed providers for online raffles
  7. Plan Ahead: License applications can take 30-45 days

Official Resources

Looking for raffle laws in other states?

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Make Your Illinois Raffle a Success

Illinois offers one of the most progressive raffle environments in the nation, particularly with its explicit allowance of online raffles. This creates opportunities for broader participation and streamlined operations. The key is choosing the right license class and following the detailed regulations.

Take advantage of Illinois's online raffle provisions to expand your reach while maintaining compliance. With proper planning and the right tools, your Illinois raffle can achieve both impressive fundraising results and full legal compliance.

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