Michigan Raffle Laws: Complete Legal Guide for Nonprofits
Michigan regulates raffles through the Bureau of State Lottery under the Charitable Gaming Act, offering multiple license types for different fundraising needs. This comprehensive guide covers small raffles, large raffles, and millionaire parties, helping nonprofits navigate Michigan's charitable gaming regulations.
⚠️ Legal Disclaimer: This guide provides general information about Michigan raffle laws as of 2026. Laws change frequently. Always consult with legal counsel or the Michigan Bureau of State Lottery for current requirements specific to your situation.
Michigan Raffle Laws: Quick Facts
Who Can Hold Raffles:
Qualified nonprofits
Small Raffle Limit:
$25,000 in prizes per event
Large Raffle License:
No prize limit
Millionaire Party:
Special event license
Online Sales:
Not permitted
50/50 Raffles:
Allowed with license
License Cost:
$15-$150 depending on type
Minimum Existence:
2 years (with exceptions)
Who Can Conduct Raffles in Michigan?
Michigan restricts raffles to qualified organizations meeting specific criteria:
Eligible Organizations Must:
Be organized for religious, educational, service, senior citizens, fraternal, or veterans purposes
Have federal tax-exempt status under 501(c)
Have been in existence for 2+ years (with exceptions)
Have a dues-paying membership engaged in the organization's purposes
Be licensed by the Bureau of State Lottery
Two-Year Rule Exceptions
The following can qualify without 2 years existence:
Component of national organization in existence 2+ years
Newly created through merger of qualifying organizations
Charter school or public school organization
License Types and Requirements
Small Raffle License
Small Raffle Specifications:
Prize limit: $25,000 total per event
Ticket price: Maximum $100 per ticket
License fee: $15 per raffle
Processing time: 3-4 weeks
Valid period: Single event only
Large Raffle License
Prize limit: No maximum
Ticket price: No limit
License fee: $50-$150 based on prize value
Bond required: May need surety bond
Additional oversight: More detailed reporting
Special Event License (Millionaire Party)
Combines multiple gaming activities
Can include raffles with other games
Limited to 4 events per year
Specific venue requirements
Professional suppliers may be used
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Conducting Your Raffle: Step-by-Step
Michigan Raffle Compliance Checklist
Verify organization meets 2-year requirement
Obtain federal tax-exempt status
Determine raffle size (small vs. large)
Apply for appropriate license type
Submit application 6-8 weeks before event
Design tickets with required information
Set up separate bank account
Train volunteers on regulations
Plan drawing procedures
Prepare financial reporting system
Required Ticket Information
Each raffle ticket must display:
Name of licensed organization
License number
Date, time, and location of drawing
Price of ticket
Prizes offered with retail value over $100
Whether winner must be present
Consecutive numbering
Stub for purchaser information
Operational Rules
Only members can sell tickets and work event
No compensation for raffle work
All workers must be 18+
Cannot sell tickets on credit
Must use Michigan-licensed suppliers for equipment
Financial Management & Reporting
Banking Requirements
Financial Controls:
Maintain separate charitable gaming account
Deposit all proceeds within 2 business days
Two signatures required on checks
No commingling with other funds
Detailed records of all transactions
Use of Proceeds
Michigan requires that net proceeds be used for:
Organization's stated lawful purposes
Cannot benefit any individual
Allowable expenses limited to actual costs
Must spend profits within 18 months
Reporting Requirements
Financial report: Due within 60 days of event
Contents: Gross receipts, prizes, expenses, net profit
Annual report: Summary of all charitable gaming
Record retention: Minimum 3 years
Available for audit: Bureau can inspect anytime
50/50 Raffles in Michigan
Michigan allows 50/50 raffles with specific guidelines:
Warning: Violations can result in license revocation, fines up to $10,000, and criminal charges. The Bureau conducts regular audits and investigations.
Common Violations
Operating without proper license
Exceeding prize limits on small raffle license
Using unlicensed suppliers
Improper financial record keeping
Paying workers or providing compensation
Failing to file required reports
Misuse of charitable gaming proceeds
Best Practices for Michigan Raffles
Apply Early: Submit applications 6-8 weeks in advance
Choose Right License: Don't try to squeeze under small raffle limits
Separate Accounting: Keep meticulous financial records
Train Everyone: All volunteers must understand rules
Use Licensed Suppliers: Only work with Michigan-approved vendors
File Reports Promptly: Late reports risk future licenses
Consider Millionaire Parties: Combine raffles with other gaming
Every nonprofit that wants to conduct a raffle in Michigan must first obtain a charitable gaming license from the Bureau of State Lottery's Charitable Gaming Section. The license is not optional — it is a legal prerequisite, and operating without one carries serious penalties. Understanding the license types, application process, and renewal requirements is essential for any organization planning a raffle fundraiser in Michigan.
What Is the Michigan Charitable Gaming License?
The Michigan Charitable Gaming License is a permit issued by the Michigan Bureau of State Lottery that authorizes qualified nonprofit organizations to conduct specific types of charitable gaming events, including raffles, millionaire parties, and charity game ticket sales. The license system exists under the Traxler-McCauley-Law-Bowman Bingo Act (Act 382 of 1972), as amended, which governs all charitable gaming in Michigan.
The license ensures that only legitimate nonprofit organizations conduct gaming activities and that proceeds go toward charitable purposes rather than private benefit.
Who Needs a Michigan Charitable Gaming License?
Any organization that wants to hold a raffle, millionaire party, or sell charity game tickets in Michigan must obtain the appropriate license. Specifically, this includes:
501(c)(3) nonprofits — charities, educational organizations, religious institutions
Churches and religious organizations — including parishes, synagogues, mosques, and affiliated groups
Schools and PTOs — public schools, charter schools, and parent-teacher organizations
Civic organizations — Rotary clubs, Lions clubs, Kiwanis, and similar service groups
Veterans organizations — VFW posts, American Legion chapters, DAV chapters
Senior citizens organizations — groups organized for the benefit of seniors
Important: For-profit businesses, individuals, and newly formed organizations (under 2 years old, with limited exceptions) cannot obtain a charitable gaming license in Michigan. The organization must have a genuine charitable, educational, religious, or civic purpose — not just exist to hold gaming events.
Types of Michigan Charitable Gaming Licenses
Michigan issues three primary classes of charitable gaming licenses. The class you need depends on the type and scale of your event:
Class A License — Small Raffles
What it allows: Raffles with total prizes valued at $25,000 or less per event
Maximum ticket price: $100 per ticket
License fee: $15 per event
Events per year: No limit on number of small raffles
Bond required: No
Best for: Smaller fundraisers, reverse raffles, basket raffles, and community events
Class B License — Large Raffles
What it allows: Raffles with total prizes exceeding $25,000 (no upper limit)
Maximum ticket price: No limit
License fee: $50-$150, scaled to total prize value
Bond required: May require surety bond depending on prize value
Additional requirements: More detailed financial reporting, potential for on-site Bureau inspection
Best for: Major fundraising galas, car raffles, house raffles, and high-dollar raffle events
Class C License — Millionaire Parties
What it allows: Multi-game events combining raffles with casino-style gaming (blackjack, poker, roulette)
License fee: $50-$100 per event
Events per year: Maximum 4 millionaire parties annually
Special rules: Must use licensed gaming suppliers, specific venue requirements, chips required for table games
Best for: Casino night fundraisers, gala events, and organizations that want to maximize revenue from a single event
How to Apply for a Michigan Charitable Gaming License: Step-by-Step
The application process is straightforward but requires advance planning. Here is how to get your Michigan raffle license:
Confirm eligibility — Verify your organization has 501(c) tax-exempt status, has been in existence for at least 2 years (or qualifies for an exception), and has a dues-paying membership
Determine the correct license class — Class A for prizes under $25,000, Class B for larger prizes, Class C for millionaire parties
Complete the application — Include organization name, EIN, event date, venue, estimated prize value, and officer information
Attach required documentation — IRS determination letter (proof of tax-exempt status), articles of incorporation, bylaws, and officer list
Pay the license fee — $15 for Class A, $50-$150 for Class B, $50-$100 for Class C
Submit to the Bureau of State Lottery — Mail or submit online through Michigan's charitable gaming portal
Wait for approval — Processing typically takes 3-6 weeks. Submit well in advance of your event date
Receive your license number — This must be printed on all raffle tickets and displayed at your event
Timing tip: Submit your application at least 6-8 weeks before your event. The Bureau does not guarantee expedited processing, and holding a raffle without an approved license is a violation regardless of whether your application is pending.
License Fees and Processing Timeline
Michigan Gaming License Fee Schedule
Class A (Small Raffle):
$15 per event
Class B (Large Raffle):
$50-$150 based on prize value
Class C (Millionaire Party):
$50-$100 per event
Processing Time:
3-6 weeks (plan for 6-8)
Surety Bond (Class B):
Varies by prize value
First-Time Applicants:
May require additional documentation
Renewal Requirements
Michigan charitable gaming licenses are issued per event, not on an annual basis. This means you need a new license for each raffle or millionaire party you hold. However, organizations that conduct frequent events should be aware of these ongoing requirements:
Each event needs its own license — There is no blanket annual raffle license in Michigan
Good standing required — All previous event financial reports must be filed before a new license will be approved
Updated documentation — If officers change or your tax-exempt status is modified, you must provide updated documents
Annual qualifying form — Organizations conducting multiple events per year may file an annual qualification to streamline repeat applications
Continuous compliance — Any outstanding violations or unpaid fines will block new license approvals
Penalties for Operating Without a License
Running a raffle without the proper Michigan charitable gaming license is not a minor administrative oversight — it is a criminal violation. Consequences include:
Potential Penalties:
Criminal charges: Operating without a license is a misdemeanor under Michigan law
Fines: Up to $10,000 per violation
License revocation: Loss of ability to obtain future charitable gaming licenses
Seizure of proceeds: The Bureau can seize all funds from an unlicensed event
Ban from charitable gaming: Individuals involved may be permanently barred from participating in charitable gaming activities
Reputational damage: Violations are public record and can harm your organization's standing in the community
Even unintentional violations — such as exceeding the $25,000 prize limit on a Class A license — can trigger enforcement action. When in doubt, apply for the higher license class to avoid risk. For more on raffle laws across all states, see our comprehensive legal guide.
Michigan Gaming Control Board and Raffle Regulation
A common point of confusion: the Michigan Gaming Control Board (MGCB) oversees commercial casinos and Detroit's three casinos, while charitable gaming (including raffles) falls under the Bureau of State Lottery's Charitable Gaming Section. However, both agencies coordinate on gaming enforcement, and the regulatory framework shares common compliance principles.
How Michigan Regulates Charitable Raffles
The Bureau of State Lottery's Charitable Gaming Section is responsible for:
License issuance and review — Processing all charitable gaming license applications
Compliance monitoring — Conducting on-site inspections and audits of licensed events
Financial oversight — Reviewing post-event financial reports for accuracy
Enforcement actions — Investigating complaints, issuing fines, and revoking licenses
Supplier licensing — Approving and monitoring gaming equipment suppliers
Public education — Providing guidance materials and answering compliance questions
Reporting Requirements
Michigan takes charitable gaming reporting seriously. Organizations must meet these obligations:
Post-Event Financial Report
Deadline: Within 60 days of each raffle event
Contents: Gross receipts from ticket sales, total prizes awarded (with fair market values), all expenses incurred, net profit calculation
Form: Bureau-provided financial report form specific to your license type
Submission: Mail to the Bureau of State Lottery or submit through their online portal
Record-Keeping Rules
Beyond filing reports, Michigan requires organizations to maintain detailed records that can be inspected at any time:
Financial records: Bank statements, deposit slips, canceled checks, and receipts for all transactions related to the event
Ticket accounting: Records showing total tickets printed, sold, unsold, and voided — all with sequential numbering
Prize documentation: Receipts for purchased prizes, donor letters for donated prizes with fair market values
Volunteer records: Names of all individuals who worked the event (must be organization members)
Retention period: Minimum 3 years from the date of the event
Availability: Records must be available for Bureau inspection with reasonable notice
Annual Reports
Organizations that conduct multiple charitable gaming events in a calendar year must also file an annual summary report. This report consolidates all gaming activity and includes:
Total gross revenue from all charitable gaming events for the year
Total prizes awarded across all events
Total expenses by category (venue, printing, supplies, etc.)
Net proceeds and how they were used for charitable purposes
Confirmation that proceeds were spent within the required 18-month window
Organizations using raffle management software often find it significantly easier to maintain the level of record-keeping Michigan requires, since digital systems automatically track ticket sales, participant information, and financial data.
Michigan offers flexible options for charitable raffles, from simple small raffles to elaborate millionaire parties. The key is choosing the right license type for your fundraising goals and maintaining strict compliance with financial reporting requirements.
Consider starting with small raffles to build experience, then graduating to large raffles or millionaire parties as your organization grows. Michigan's detailed regulations provide clear guidelines that, when followed properly, create successful and compliant fundraising events.
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