Vermont Charitable Gaming License: Rules for Raffles, Bingo, and Nonprofit Events

Vermont does not use a one-size-fits-all statewide charitable gaming license for every fundraiser. Instead, state law allows qualifying nonprofit organizations to run lotteries, raffles, bingo, and other games of chance for charitable, religious, educational, and civic purposes, as long as they follow the state’s gaming rules.

For nonprofits planning a fundraiser, the key question is not only whether the event is allowed, but also how the proceeds are handled, who may participate, how often the game may be run, and what reports must be filed after the event.

Is a Vermont Charitable Gaming License Required?

In many cases, no separate state-level charitable gaming license is required for a simple raffle or similar fundraiser. Vermont law authorizes nonprofit organizations to organize and execute lotteries, raffles, and other games of chance for permitted charitable purposes.

That does not mean the activity is unregulated. The organization must still:

• qualify as a nonprofit organization under Vermont law
• use the proceeds for approved charitable purposes
• stay within the state’s prize, compensation, and frequency limits
• avoid prohibited devices and prohibited forms of bingo
• file required financial reports when applicable

The safest approach is to treat charitable gaming as a compliance exercise, not a casual fundraiser.

What Counts as a Qualified Nonprofit?

Vermont defines a nonprofit organization broadly for gaming purposes. The definition includes a nonprofit corporation that qualifies for federal tax-exempt status under IRC Section 501(c) and has engaged in good-faith charitable, religious, educational, or civic activities in Vermont on a regular basis during the preceding year.

The definition also includes:

• churches
• schools
• fire departments
• municipalities
• fraternal organizations
• organizations that operate agricultural fairs or field days

The organization must also certify annually, on a form required by the Commissioner, that it meets the definition.

If your group is newly formed, make sure your legal entity, tax status, and governing records are in order before you plan a gaming fundraiser.

Which Charitable Gaming Activities Are Allowed?

Vermont permits several common types of nonprofit gaming, including:

• raffles
• lotteries
• bingo
• games of chance
• certain casino events
• break-open ticket sales, subject to separate rules

The law also makes clear that gambling machines and other mechanical devices generally cannot be used under the nonprofit gaming authority.

One important restriction is that bingo may not be conducted using numbers communicated electronically or by satellite to players at another location. In other words, remote or linked electronic bingo is not allowed under this provision.

Core Rules Every Nonprofit Should Follow

A charitable gaming event in Vermont must be structured around the statutory limits. The most important rules are the ones that affect how proceeds are used, who can work the event, and how much can be awarded in prizes.

Use of Proceeds

All proceeds raised by a game of chance must be used exclusively for charitable, religious, educational, or civic undertakings after allowable deductions. Permitted deductions generally include reasonable expenses for:

• materials and equipment
• advertising and promotion
• rent for the premises used for the game
• repairs and upkeep when the nonprofit owns the premises
• prizes awarded to players
• compensation allowed by law

That means the fundraiser should be planned so the net benefit is clearly tied to the organization’s exempt mission.

Compensation Limits

Vermont places strict limits on payment to anyone who organizes or works a game of chance. A nonprofit may not pay any person more than $2,000 in a calendar year for organizing, executing, or working at games of chance.

There is also an overall aggregate cap of $15,000 per calendar year for all such payments combined.

Meals or refreshments provided to volunteers while working at the event are not treated as compensation.

Age Restrictions

A person under the age of majority may not organize or execute a game of chance. Minors may perform services that are not related to the execution of the game itself, but they may not run the gaming activity.

Prize Limits

Prize caps matter. Vermont law allows a nonprofit to offer:

• up to $400 for a single game of chance
• up to $1,000 for one game per day
• up to $5,000 for one game per calendar month
• up to $50,000 for one game per calendar year involving a motor vehicle, firearm, motorcycle, or watercraft

A nonprofit may exceed the usual prize limits on four days per calendar year if the days are at least 20 days apart and the total prize money offered for all games on that day does not exceed $50,000.

Frequency Limits

Nonprofit gaming cannot be run every day. In general, a nonprofit may not organize and execute games of chance on more than two days in any calendar week, and a location may not host games of chance on more than two days in any calendar week.

There are exceptions for certain casino events, break-open tickets, agricultural fairs, and limited multi-day events.

Casino Event Limits in Vermont

Casino-style fundraising is tightly limited. A location may host:

• no more than one casino event in any calendar quarter, or
• no more than three casino events in any calendar year, with at least 15 days between each event

If the location is owned by a nonprofit, the site may host up to two casino events in any calendar month, as long as there are at least 10 days between events.

A nonprofit organization may itself organize and execute no more than one casino event in any calendar month.

For planning purposes, casino-style fundraising should be treated as a specialized event that needs more oversight than a standard raffle.

Break-Open Tickets Have Their Own Rules

Break-open tickets are regulated separately. Only nonprofit organizations may purchase break-open tickets from a licensed distributor, and only nonprofit organizations may sell them at retail.

Additional requirements apply, including:

• unique serial numbering on retail tickets
• restrictions on who may distribute tickets
• limits on where tickets may be sold
• quarterly reporting to the Department of Liquor and Lottery for many nonprofits

If your organization plans to use break-open tickets, build the compliance process before the first ticket is sold. Ticket inventory, serial numbers, and reporting records should all be tracked from the start.

Filing and Reporting Duties

A charitable gaming fundraiser does not end when the prizes are awarded. Vermont requires financial reporting in several situations.

A nonprofit that organizes and executes a game of chance under the statute must file financial reports with the Commissioner of Taxes, including:

• copies of federal Form 990 or 990-T, if the organization is required to file them
• a detailed annual financial report by June 15 if the organization raised more than $10,000 from games of chance in the preceding year and is not otherwise required to file Form 990 or 990-T
• reports describing Vermont income tax withholding on gambling winnings, when applicable

The required report should include itemized information about:

• gaming expenses
• payments to workers
• rent
• prizes
• disbursements to charitable purposes
• total funds raised

If the report is late or incomplete, the Commissioner may seek injunctive relief to stop the organization from continuing to run games of chance.

Practical Compliance Checklist

Before launching a charitable gaming event in Vermont, confirm the following:

• your organization qualifies as a nonprofit under Vermont law
• annual certification is current
• the fundraiser’s purpose is charitable, religious, educational, or civic
• the chosen game is allowed under state law
• prize amounts stay within legal limits
• volunteer and worker payments stay within compensation caps
• minors are not running the gaming activity
• the event schedule stays within weekly, monthly, and annual limits
• ticket numbers, sales, expenses, and prizes are tracked accurately
• required tax and financial reports are filed on time

If any item on that list is unclear, resolve it before the event begins.

When to Get Help

You should seek professional compliance help if your nonprofit is:

• running a casino-style fundraiser
• planning recurring gaming events
• selling break-open tickets
• paying staff or contractors for event support
• preparing a first-time Form 990 or gaming report
• operating through a new entity that has not yet built strong recordkeeping practices

A small compliance mistake can turn a fundraiser into a reporting problem.

Final Takeaway

Vermont does not require a general charitable gaming license for every nonprofit raffle or game of chance, but it does require careful compliance with state gaming laws. The organization must qualify as a nonprofit, use proceeds for approved purposes, respect prize and payment caps, and file reports when required.

For nonprofits, the real goal is not just to hold a successful fundraiser. It is to hold one that can withstand scrutiny, protect the organization’s mission, and keep future fundraising opportunities open.