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Can I offer contests that involve travel prizes in Louisiana? What are the requirements?

Yes, you can offer contests that involve travel prizes in Louisiana. However, there are certain requirements that must be met.

Requirements for Offering Contests with Travel Prizes in Louisiana

  1. Obtain a gaming license: Organizations conducting raffles must first obtain a gaming license as required by R.S. 33:4861.1 [4.1].
  2. Provide information: Applications for a gaming license to hold a raffle shall include the following information: a. date of raffle; b. location of drawing or determination of winner; c. prize(s) to be given and their value (see §1727); d. cost of tickets or chances to participants [4.1].
  3. Maintain records: The following information pertaining to each raffle held shall be maintained by licensee and retained for a period of three years: a. number of tickets or chances sold; b. number of tickets or chances printed or available; c. name of person drawing winning ticket(s) or determining winner(s); d. prizes given and their value (see §1727); e. name, address and date of birth of winner(s) [4.1].
  4. Purchase or obtain merchandise by donation: Merchandise for a raffle must be purchased or obtained by donation prior to the sale of any chances [4.1].
  5. Furnish proof of liquid assets: Where the prize to be awarded is cash in excess of $1,000, the organization shall furnish the division with proof of liquid assets equal to or greater than the value of the prize [4.1].
  6. Ensure random selection of winner: The sponsoring organization shall take such steps as are necessary under the circumstances to ensure that each ticket purchaser has a chance to be selected as the prize winner and that the prize winner is selected in an entirely random manner [4.1].
  7. Pay taxes: If the proceeds of any sports wagering prize issued pursuant to this Subtitle are five hundred dollars or more, the prize shall be subject to Louisiana state income tax [5.1]. Proceeds of any lottery prize of five hundred dollars or more shall also be subject to Louisiana state income tax [6.1].
  8. Verify validity of tickets: The corporation shall adopt rules to establish a system of verifying the validity of tickets claimed to win prizes and to effect payment of such prizes [5.1][6.1].
  9. Pay prizes: Retailers shall pay any lottery prize of $50 or less. A retailer may pay prizes greater than $50, up to $600, after proper verification of such winning tickets as prescribed by the corporation. Prizes of more than $600 shall be paid by the corporation by mail or at a designated corporation office [1.1]. The corporation may provide for the payment of any prize of more than $100,000 in equal annual installments [2.2].

Additional Information

  • Merchandise prizes must be valued based on the fair market value of the prize, which will be the amount reported to the state and the IRS for tax purposes. The corporation may pay withholding taxes on behalf of the winner in accordance with federal and state rules [2.1].
  • Sweepstakes promotions are regulated by the Department of Justice, office of attorney general. The winner of any sweepstakes promotion shall be revealed in only one of the following manners: through posting on a printed list, through the use of scratch-off tickets or cards, through the use of pull-tab tickets or cards, or by contacting the winner in writing or through telephone communication [3.1].
  • If offering a prize or gift to a consumer as part of any advertising or sales promotion plan, the consumer must be given full disclosure of the exact prize or gift tendered, all terms and conditions attached to the prize or gift, and a statement that the consumer is given, invited, required, or requested to submit to a sales presentation or promotional program. Any prize, gift, or other item offered pursuant to a prize and gift promotional offer must be delivered to the prospective purchaser whether or not he or she purchases the product offered for sale [3.2].

Therefore, to offer contests with travel prizes in Louisiana, organizations must obtain a gaming license, provide necessary information, maintain records, purchase or obtain merchandise by donation, furnish proof of liquid assets, ensure random selection of winner, pay taxes, verify validity of tickets, and pay prizes.

Source(s):
Jurisdiction

Louisiana