We recently helped with an event where we watched as the staff at the venue removed beer and wine bottles from the auction baskets because the organization didn’t have a license to sell. If you don’t know the laws where you are hosting your event, you could find yourself in a similar situation.
While we recognize that these laws do not pertain to all our clients, and we are certainly not legal counsel, we can provide general guidance for your event. First, you should always have the number of a good legal resource on hand so that you clearly know the laws and regulations in your area. Then there are three main areas you need to review to make sure you’re in the clear before you finalize plans for your next fundraiser.
Sales tax for non-profits — This area is not black and white. While many transactions of non-profit organizations are tax exempt (if the organization has been approved for tax exempt status), sales tax still applies to items the organization sells. This may apply to items you have available at your fundraising event. According to the Idaho State Tax commission, a sales tax permit is required. If you sell items infrequently, a temporary permit may be an option for you.
Gaming and lotto laws — Does your state require a license for BINGO or raffles? Idaho does. The application process is thorough, but inexpensive. If a raffle, BINGO, or other game is part of your fundraising efforts, play it safe and look into getting a license from your State Lottery.
Beer and wine sales — Make sure you take care of this one at least two weeks prior to your event to ensure your raffle baskets stay intact for the big day. You’ll need to secure a non-profit license to sell or serve alcohol. All states will have different processes and fees, so be sure to check with your local Alcohol Beverage Control agency.
Our goal is always to help your auction run smoothly and be a success. Check these concerns off your list by contacting a legal resource in your area and you’ll be sure to pull off your next big event without a hitch (at least not one that comes with a visit to court and a hefty fine). Hello, peace of mind!
Look for this information and more at Auction Frogs’ Workshop Wednesday, coming in 2020!