Do I need a license to hold a raffle in South Dakota?

Yes. South Dakota requires nonprofit organizations to obtain a gaming license from the South Dakota Commission on Gaming or the Department of Revenue before conducting raffles. The specific requirements depend on the scale of your gaming activities.

Who can legally hold a raffle in South Dakota?

South Dakota allows qualified nonprofit organizations, including charitable, religious, educational, fraternal, and veterans groups, to conduct raffles. Organizations must be registered with the state and have a primary purpose other than gaming.

What are the prize limits for South Dakota raffles?

South Dakota sets specific limits on raffle prizes. The maximum prize values and annual gaming revenue caps depend on the type of license held. Organizations should consult the Department of Revenue for current prize limit schedules.

Can I sell raffle tickets online in South Dakota?

South Dakota's charitable gaming laws generally require in-person ticket sales. Online ticket sales are not specifically authorized. Organizations should consult with the Department of Revenue before attempting digital sales.

What taxes apply to South Dakota raffle winnings?

South Dakota has no state income tax, so winners do not owe state taxes on raffle prizes. However, federal tax obligations still apply - prizes valued at $600 or more must be reported to the IRS, and the organization must issue W-2G forms for qualifying prizes.

South Dakota Raffle Laws: Complete Legal Guide for Nonprofits

South Dakota regulates nonprofit gaming through the Department of Revenue, requiring organizations to obtain proper licensing before conducting raffles. This guide covers the licensing process, prize limits, and compliance requirements for running a legal raffle in the Mount Rushmore State.

Nonprofit raffle event in South Dakota — South Dakota nonprofits raise funds through well-organized raffles

Legal Disclaimer: This guide provides general information about South Dakota raffle laws as of 2026. Laws change frequently. Always consult with legal counsel or the SD Department of Revenue for current requirements.

South Dakota Raffle Laws: Quick Facts

Who Can Hold Raffles:	Qualified nonprofit organizations
License Required:	Yes, from Dept. of Revenue
Governing Law:	SDCL Chapter 22-25
Cash Prizes:	Permitted within limits
State Income Tax:	None (no state tax on winnings)
Online Sales:	Generally not permitted
Reporting:	Annual reports required
Age Requirement:	18+ to participate

Who Can Conduct Raffles in South Dakota?

South Dakota Codified Laws Chapter 22-25 governs charitable gaming. The Department of Revenue oversees licensing and enforcement for nonprofit gaming activities. For a comprehensive look at raffle laws across the country, see our complete guide to raffle laws by state.

Eligible Organizations Include:

Charitable organizations registered in South Dakota
Religious organizations
Educational institutions
Fraternal organizations
Veterans organizations
Civic and service organizations

Licensing Requirements

License Application Process:

Apply to the South Dakota Department of Revenue
Provide proof of nonprofit status
Describe planned gaming activities
Pay applicable license fees
Designate a responsible gaming manager
Receive approval before conducting any raffle

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Prize Limits and Rules

Key Prize Regulations:

Individual prizes: Subject to caps per license type
Cash prizes: Permitted within established limits
Annual revenue caps: Total gaming revenue limited by license
Net proceeds: Must be used for charitable purposes

Conducting Your Raffle: SD Requirements

South Dakota Raffle Compliance Checklist

Obtain gaming license from Department of Revenue
Verify nonprofit status is current
Ensure prizes fall within permitted limits
Print tickets with required information
Restrict sales to persons 18 and older
Conduct drawing fairly and transparently
Set up proper financial tracking
File annual reports
Maintain records for required period
Direct net proceeds to charitable purposes

Tax Implications

No state income tax: South Dakota has no state income tax, so winners do not owe state taxes on raffle prizes
Federal taxes: Prizes of $600 or more must be reported to the IRS
W-2G forms: Organizations must issue for qualifying prizes
Organizations: Gaming income may be subject to federal UBIT

Online Raffle Rules in South Dakota

South Dakota's gaming laws generally require in-person ticket sales. Online sales are not specifically authorized. Organizations should consult with the Department of Revenue before pursuing digital sales. For tips on running effective events, see our guide on raffle software options.

Penalties for Violations

Warning: Conducting unlicensed gaming in South Dakota is a criminal offense. Penalties include fines, license revocation, and potential criminal prosecution. The Department of Revenue actively enforces gaming regulations.

Best Practices for South Dakota Raffles

Get Licensed First: Never conduct a raffle without proper authorization
Know Your Limits: Understand prize caps for your license type
Keep Detailed Records: Track all tickets, prizes, and finances
File Reports On Time: Meet all annual reporting deadlines
Separate Gaming Funds: Maintain dedicated bank accounts
Train Volunteers: Ensure everyone understands the rules

Official Resources

Looking for raffle laws in other states?

View All States | North Dakota

Make Your South Dakota Raffle a Success

South Dakota's licensing framework provides a clear process for nonprofits to conduct legal raffles. Combined with the state's lack of income tax on winnings, this makes South Dakota an attractive environment for charitable gaming events.

Ready to streamline your raffle management? Get started with rafflr today to handle drawings, track tickets, and maintain the records South Dakota requires.