Learn the requirements and recommendations for running a charity Sweepstakes on DoJiggy.
Like Raffles, Sweepstakes are a fundraising method where donors purchase entries for the chance to win a prize. Unlike Raffles, Sweepstakes must offer a free method of entry. This allows you to run a Sweepstakes in areas that may prohibit Raffles. You'll also need to be aware of other legal requirements for running a Sweepstakes.
DoJiggy provides many tools and customization options to help you run a smooth and successful Sweepstakes. The links below will take you to other Knowledge Base articles with further information.
Sample Sweepstakes
Take a glimpse at our Sweepstakes demo to see if this Activity is right for you.
Pricing
Pricing options can be found in the following article:
Approval
For Sweepstakes to meet the legal definition that allows them to exist with limited regulation, they must have several essential components. Our approval process ensures these components comply with regulations.
Official Rules
Sweepstakes must have official rules that detail the terms of the Campaign. These official rules act as a contract between the sponsor (your organization) and the donor to protect both parties.
DoJiggy provides built-in, legally compliant official rules for each Sweepstakes. The eligibility includes the US and Canada where people purchase an entry to win any prize listed on the fundraising page. The rules are created automatically by the information entered in the Campaign setup. You can view the rules on the Sweepstakes page when previewing the Campaign.
Alternate Method of Entry
Sweepstakes are legally required to include an alternate method of entry (a free entry option). Instructions for the free entry option must be included in your official rules, and only one free entry per person is allowed. In our experience, mail-in entries typically total less than one percent of the number of donation-based entries. Some Sweepstakes receive no mail-in entries at all! We find that most people are willing to donate to participate since the cause is charitable.
The free method of entry requirement does impact some aspects of your Sweepstakes.
Approximate Retail Value (ARV)
The approximate retail value of your prize(s) is an essential legal detail for your Sweepstakes. Most organizations determine the ARV based on the cost of purchasing the prize(s) or using the "street" price. However, some prizes, such as lunch with a celebrity, may not have an ARV since these prizes are unique to the experience and can't be purchased. In this case, the ARV would be an estimated price for the lunch.
If the prize is cash, then the actual cash value should be listed as the ARV.
Registration and Bonding
If the total ARV of your prize(s) is $5,000 or more, then you'll need to register and bond your Sweepstakes in the state of New York if you want its residents to be able to participate. If your organization is not a 501(c), then registration and bonding are also required in Florida. The process of registering and acquiring a surety bond is simple but can take up to two weeks. Your Campaign must be completely set up before acquiring the bond. No changes can be made to the Campaign once the bond has been obtained.
DoJiggy will provide you with all the information you need to navigate the registration and bonding process. If you prefer not to register and bond your Sweepstakes, you may choose to exclude New York (and Florida) residents from your Sweepstakes. The DoJiggy team can add this exclusion to the official rules.
If you register your Sweepstakes in one of these states, you will need to provide the state with the winner's information within six months of the end of the Campaign. We will provide a link to the form and the address to send the form in your registration and bonding packet.
Advertising and Promotion
If you plan to promote your Sweepstakes via social media, radio, television, or other channels, be sure to check with each media source to ensure that you comply with their guidelines for these experiences. For instance, you may be required to include specific language in your postings (such as "No purchase necessary").
Pre-Registration
Pre-registration allows donors to create a DoJiggy account and save a payment method before your Sweepstakes begins. When your Sweepstakes starts, they can check out quickly and easily:
Selling Entries Offline
DoJiggy allows you to manually add any Sweepstakes entries you sell offline. When you do so, you’ll need to confirm that the donor was informed of the free entry option before they purchased their entries offline. This helps you comply with local and federal laws and regulations.
Types of Drawings
With DoJiggy, you can only run a Sweepstakes drawings where entrants have a chance to win any of the prizes listed on your Campaign.
Not permitted:
- A 50/50 or split the pot type format like some Raffles.
- Drawings with a limited number of entries.
- A manual option for drawing winners (drawings must be done at random, electronically, by our system).
Good to Know
- Because of the different legal aspects of Raffles and Sweepstakes, please ensure that the word Raffle does not appear on your Sweepstakes fundraiser page. Any Raffle reference is required to be removed before the fundraiser is live.
Winner Notification
Sweepstakes sponsors are responsible for providing an Affidavit of Eligibility and a Liability and Publicity Release to the potential winner(s) as needed. The Affidavit of Eligibility declares that a winner is legally eligible to win. The winner is responsible for returning the affidavit before receiving the prize(s).
The Liability and Publicity release gives the sponsor and other parties (like the sponsor's marketing agency) the right to use and publish the winner's name and other non-personal information in promotional materials related to the Sweepstakes. This document also releases the sponsor from liability concerning taxes or claims related to the Sweepstakes winner. For a Sweepstakes offering trips on which the winner can bring a guest, the sponsor is also responsible for supplying the winner with a guest release.
These documents can be found online, but we've also included templates below that you can use for your Campaign if desired. Of course, you'll want to customize these templates before sending them, and then contact the winner(s) to find out the best way to provide them with the documents for signature.
Tax Reporting
The IRS mandates that the value of a Sweepstakes prize should be included in the winner's gross income. Therefore, if the prize(s) value is $600 or more, your organization must issue a Form 1099 to the winner. You can download a 1099 form here: Form 1099.
The information provided on the 1099 Form will include the sponsor's name, address, tax ID, prize value, winner's name, address, and social security number. The amount of tax the winner must pay on the prize is determined based on their income and tax bracket.
Sweepstakes Reports
DoJiggy provides several reports you can use to manage Sweepstakes details and analyze data:
Track Donor Data and Get Insights
Integrate your DoJiggy account with Google Analytics or Meta Pixel to track donor behavior on your Campaign Pages. Use these insights to pinpoint successful fundraising methods, create targeted ads, and more. Learn more about Google Analytics and Meta Pixel in the following Knowledge Base articles:
Get Started
Click here to create a free account and start building your fundraiser. Test out your Campaign before going live by selecting the ‘Preview’ button at the top of any page in Campaign setup:
Contact Us
Have questions? We’re here to help! Our team is available via chat on our website during normal business hours. Just hit the orange message button on the bottom right of your screen. You can also search our Knowledge Base for answers.