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Can I offer contests that involve charity donations in Florida? What are the requirements?

Requirements for Offering Contests that Involve Charity Donations in Florida

Yes, it is legal to offer contests that involve charity donations in Florida. However, there are certain requirements that must be met.

Auction Requirements [3.1]

If the contest involves an auction, it must be conducted by an auctioneer who has an active Florida auctioneer license or an apprentice who has an active Florida apprentice auctioneer license and who has received prior written sponsor consent. The auction must also be conducted under the auspices of a licensed auction business which has an active Florida auction business license. The principal auctioneer shall be responsible for conducting the auction in a professional and ethical manner. The auction business under which the auction is conducted is responsible for all other aspects of the auction to include contract negotiations, advertising, auction organization and layout, merchandise distribution and final settlement with the seller.

Soliciting Contributions Requirements [4.2]

If the contest involves soliciting contributions in or from Florida, the charitable organization or sponsor must file an initial registration statement, and a renewal statement annually thereafter, with the department. Any changes in the information submitted on the initial registration statement or the last renewal statement must be updated annually on a renewal statement provided by the department. The registration of a charitable organization or sponsor may not continue in effect and shall expire without further action of the department if it fails to file its renewal statement in accordance with this section. The initial registration statement must include the name of the charitable organization or sponsor, the purpose for which it is organized, the name under which it intends to solicit contributions, and the purpose or purposes for which the contributions to be solicited will be used. The registration statement must also include a copy of the financial statement or Internal Revenue Service Form 990 and all attached schedules or Internal Revenue Service Form 990-EZ and Schedule O required under s. 496.407 for the immediately preceding fiscal year.

Reporting Requirements for Charity/Scholarship Performances [2.1]

If the contest involves charity/scholarship performances, the proceeds from all charity/scholarship performances shall be distributed only to proposed recipients which are determined by the division to be in compliance with Section 550.0351, F.S. Any charity registered with or determined to be exempt by the Division of Consumer Services pursuant to Chapter 496, F.S., shall be deemed in compliance with Section 550.0351, F.S. It shall be the permitholder’s responsibility to insure that charity recipients are registered or have been determined to be exempt pursuant to chapter 496, F.S., or are duly qualified with the division by the filing of a copy of the exemption from taxation issued by the Internal Revenue Service to such charity. Within 120 days after the conclusion of its fiscal year each permitholder shall pay the proceeds of all charity performances to the authorized charities and, within 45 days after the required due date for such payments, shall submit to the division Form FGCC PMW-3540, Statement of Proceeds for Charity Day Performance, and Form FGCC PMW-3550, Charity Day Proceeds and Distribution.

Collection Receptacles Requirements [4.1]

If the contest involves collection receptacles used for donations, the collection receptacle must display a permanent sign or label on each side which contains the following information printed in letters that are at least 3 inches in height and no less than one-half inch in width, in a color that contrasts with the color of the collection receptacle:

  • For a collection receptacle used by a person required to register under this chapter, the name, business address, telephone number, and registration number of the charitable organization or sponsor for whom the solicitation is made.
  • For a collection receptacle placed or maintained in public view by a person not required to register under this chapter or by a person not claiming an exemption pursuant to s. 496.406, the name, telephone number, and physical address of the business conducting the solicitation and the statement: “This is not a charity. Donations made here support a for-profit business and are not tax deductible.”

Upon request, a charitable organization or sponsor using a collection receptacle must provide the donor with documentation of its tax-exempt status and the registration issued under this chapter.

Therefore, if the contest involves an auction, it must be conducted by a licensed auctioneer and auction business, and if it involves soliciting contributions, the charitable organization or sponsor must file an initial registration statement and a renewal statement annually thereafter with the department. If it involves charity/scholarship performances, the proceeds must be distributed only to proposed recipients which are determined by the division to be in compliance with Section 550.0351, F.S. and if it involves collection receptacles used for donations, the collection receptacle must display a permanent sign or label with specific information.

Source(s):
Jurisdiction

Florida