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Can I use social media to fundraise in Texas? What are the requirements?

Using Social Media for Fundraising in Texas

Yes, you can use social media to fundraise in Texas. However, there are certain requirements that you need to follow.

According to the Office of the Attorney General, if you are a qualified 501(c) tax-exempt, nonprofit organization that has been in existence for at least three years, you may hold raffles in Texas [1]. However, individuals and for-profit businesses may not hold raffles.

When it comes to crowdfunding, social media, and fundraising platforms, it is important to be cautious. The Federal Trade Commission advises that you should confirm with whoever posted the link that they know the person behind the fundraising. You should also read Donating through Crowdfunding, Social Media, and Fundraising Platforms for more tips on what to look for when you’re asked to donate on social media or to a crowdfunding campaign [2].

Requirements for Fundraising in Texas

If you are using social media to fundraise in Texas, you must follow the guidelines set by the Charitable Raffle Enabling Act, Chapter 2002 of the Occupations Code (CREA) [1]. The statute is very technical and should be consulted before advising an organization regarding the legality of a proposed raffle.

Each qualified organization is allowed two raffles per calendar year [1]. If you are a professional sports team charitable foundation, you may hold raffles during home games, with certain specified restrictions [3].

Unlike raffles and bingo, there is NO exception to the gambling law in Texas for nonprofits to hold poker or casino night fundraising events. The gambling law, Chapter 47 of the Penal Code, applies to nonprofits and to for-profits equally [3].

If you are selling taxable items or services at fairs, festivals, markets, and shows, including sellers from outside Texas participating at these events, you are engaged in business in Texas and must have a Texas Sales and Use Tax Permit [5].

Conclusion

Yes, you can use social media to fundraise in Texas. However, you must follow the guidelines set by the Charitable Raffle Enabling Act, Chapter 2002 of the Occupations Code (CREA). If you are a qualified 501(c) tax-exempt, nonprofit organization that has been in existence for at least three years, you may hold raffles in Texas. Each qualified organization is allowed two raffles per calendar year. If you are selling taxable items or services at fairs, festivals, markets, and shows, you are engaged in business in Texas and must have a Texas Sales and Use Tax Permit.

Source(s):
Jurisdiction

Texas