Laws and Rules for Sweepstakes in Each State
First, it helps to understand the difference between a sweepstakes, contest and lottery. In a sweepstakes, winners are chosen randomly from all participants. In a contest, the winners’ entries are usually judged and are based on a skill or criteria. In a lottery, winners are chosen at random, but in order to enter, the participant must pay. A payment is called a consideration. Only states can hold lotteries, so all private lotteries are illegal.
To avoid being classified as an illegal lottery in any state, your promotion can only have 2 of these 3 elements: prize, chance and consideration. Keep in mind, consideration can mean anything of value, including a fee or even a significant effort (i.e., time spent shooting/submitting a photo, etc.)
Here are possible combinations:
Prize + consideration + chance = illegal lottery or gambling
Prize + consideration = legal contest (in most jurisdictions)
Prize + chance = legal sweepstakes
All sweepstakes in the United States must meet the following regulations:
No purchase necessary. You can enter the sweepstakes without buying a product or service.
Winners are required to pay taxes on prizes they win.
Text to Win Sweepstakes Compliance
Text to Win sweepstakes are legal in all 50 states including the District of Columbia.
All call-to-action statements (i.e., Text SWEEPKEY WORD to 65047 for a chance to win [prize description]) should follow with “Text message and data rates may apply.” disclaimer.
Sweepstakes and Contest Abbreviated Rules statements should be included in all printed and digital marketing materials.
The Sweepstakes or Contest Entry Page (page where participants enter contact information) should contain the following statement:
States determine if the promotion is a sweepstakes or a contest by either the:
Material Test Element: when reviewing if chance or skill prevails in a promotion combining elements of both, this test determines the promotion as a chance based promotion if chance is an essential or important (i.e., material) component in the selection of a winner, even if chance does not dominate the selection of the winner as in the Dominant Factor Doctrine used by other states.
Dominant Factor Doctrine: when reviewing if chance or skill prevails in a promotion combining elements of both, this test designates the promotion as a chance-based promotion if chance dominates the selection of the winner, even though skill or judgment may effect winner selection to some measure.
Sweepstakes are regulated nationally and by state by the following organizations:
Federal Trade Commission (FTC)
Federal Communications Commission (FCC)
United States Postal Service (USPS)
United States Department of Justice (DOJ)
State Specific Sweepstakes & Contest Laws
Besides federal considerations, every state has its own specifics laws regarding sweepstakes and contests.
See state specific laws: https://www.sweeppeasweeps.com/sweepstakes-and-contest-rules-by-state.html
* Must observe social media platform promotion guidelines.
Note: the information above is for informational purposes only and should not be construed as legal advice. Sweepstakes and Contest promotional laws change and the above may not reflect the must current laws.
Sources: Ala. Code 9-9-13, Alaska Stat. 11.66.280, Ariz. Rev. Stat. 13-3302, Ark. Code 4-102-106, Cal. Bus. & Prof. Code 17539.1, Colo. Rev. Stat. 6-1-803, Conn. Gen. Stat. 42-297, Contest and Sweepstakes Laws by Joy R. Butler, Del. Code tit. 11, 1408, D.C. Code 3-1323, Fla. Stat. 849.094, Ga. Code 10-1-830, Haw. Rev. Stat. 712-1220, Idaho Stat. 18-3801, Comp. Stat. Ch. 815, Ind. Code 24-8-3-2, Iowa Code 714B, Kan. Stat, 21-6403, Ky. Rev. Stat. 365.055, L.A. Rev. Stat. 51:1721, Me. Rev. Stat. tit 17, Md. Code, Com. Law 13-305, Mass. Gen. Laws ch. 271, Mich. Comp. Laws 750.372a, Minn. Stat. 325F.755, Miss. Att'y Gen. Op. no. 94-0725, Mo. Ayy'y Gen. Op. No. 70-83, Mont. Code 30-14-1403, Neb. Rev. Stat. 86-228, Nev. Rev. Stat. 598.135, N.H. Rev. Stat. 358-O, N.J Stat. 5:19 and N.J. Att'y Op. 1-1980, N.M. Code R. 18.104.22.168, N.Y. Gen. Bus 369-ee, N.C. Gen. Stat. 75-33, N.D. Att'y Gen. Op no. 98-L-132 and 98 and N.D. Cent Code 53-11-02, Ohio Rev. Code 4719.01, Okla. Stat. 21-996.1, Or. Admin. R. 137-020-0430, 73 P.S. 2241-2249, R.I. Gen. Laws 42-61-1, S.C. Code 37-15-10, S.D.C.L 37-32-1, Tenn. Code 47-18, Tex. Bus & Com 621, Utah Code 13-28-1, Vt. Stat. tit. 13 2143b, Va. Code. 59.1-415, Wash. Rev. Code 19.170.020, W. Va. 46A-6D-1, Wis. Stat. 945.01(5)(b)2, Wis. Stat. 100.171(3) (2014), Wyo. Stat, 40-12-201 (2014), Contest and Sweepstakes Laws by Joy R. Butler
State Laws State prize and gift notification laws also regulate the offering of sweepstakes, gifts, prizes, and premiums. Such regulation may include specific disclosure requirements for sweepstakes and contests, prohibitions on conditioning the receipt of prizes or gifts on the purchase of a product, prohibitions on “everybody wins” sweepstakes and restrictions on the use of simulated checks. Many of these state laws also impose various disclosure requirements on the offering of gifts or premiums. Alabama: Sweepstakes Solicitations – Ala. Code §§ 8-19D-1 to 8-19D-1 (2006). Arkansas: Prize Promotion Act – Ark. Code. Ann. §4-102-101 to 4-102-109 (2006). California: Prize Notification – Cal. Bus. & Prof. Code § 17537 (2006); Solicitation materials containing sweepstakes entries - Cal. Bus. & Prof. Code § 17539.15 (2006); Unlawful advertising; conditional offer of prizes or gifts – Cal. Bus. & Prof. Code §§ 17537 – 17537.1 (2006). Colorado: Sweepstakes and Contests – Colo. Rev. Stat. §§ 6-1-802 to 6-1-804 (2006). Connecticut: Sweepstakes – Conn. Gen. Stat. §§ 42-295 to 42-300 (2006). Florida: Game Promotion Registration Law – Fla. Stat. Ann. § 849.094 (2006). Georgia: Fair Business Practices Act – Ga. Code Ann. §§ 10-1-392 to 10-1-393 (2006). Hawaii: Offers of gifts or prizes; unlawful – Haw. Rev. Stat. § 481B-1.6 (2006). Illinois: Prizes and Gifts Act – Ill. Comp. Stat. Ch. 815 §§ 525/1 – 525/35 (2006); Offers of free prizes, gifts or gratuities; disclosure of conditions – Ill. Comp. Stat. Ch. 815 § 505/2P (2006). Indiana: Promotional Gifts and Contests – Ind. Code Ann. §§ 24-8-1-1 to 24-8- 6-3 (2006). Iowa: Prize Promotions – Iowa Code §§ 714B.1 – 714B.10 (2006). Kansas: Prize Notification – Kan. Stat. Ann. § 50-692 (2006). Kentucky: Use of mailed document purporting to inform of winning a prize – Ky. Rev. Stat. Ann. § 365.055 (2006). Louisiana: Promotional Contests – La. Rev. Stat. Ann. §§ 51:1721 – 51:1725 (2006). Maryland: Offers of conditional prizes; exceptions – Md. Code Ann. Com. Law I § 13-305 (2006). Michigan: Lotteries – Mich. Comp. Laws § 750.372a (2006). Minnesota: Prize notices and solicitations – Minn. Stat. § 325F.755 (2006). Nevada: Sales Promotions – Nev. Rev. Stat. §§ 598.131 – 598.139 (2006). New Hampshire: Prizes and Gift Act – N.H. Rev. Stat. Ann. §§ 358-O:1 to 358- O:10 (2006). New Jersey: Notification to person that he has won prize and requiring him to perform act – N.J. Stat. Ann. § 56:8-2.3 (2006). New Mexico: Game Promotion Regulations – N.M. Admin. Code tit. 1 §§ 2.2.7 – 2.2.13 (2006). New York: Game Registration Law – N.Y. Gen. Bus. Law § 369-e (2006); Prize Award Schemes – N.Y. Gen. Bus. Law § 369-ee (2006). North Carolina: Prize Presentation Law – N.C. Gen. Stat. §§ 75-32 to 75-34 (2006). North Dakota: Contest Prize Notices – N.D. Cent. Code §§ 53-11-01 to 53-11- 05 (2006). Ohio: Prizes – Ohio Admin Code § 109:4-3-06 (2006). Oklahoma: Consumers Disclosure of Prizes and Gifts Act – Okla. Stat. tit 21 §§ 996.1 – 996.3 (2006). Oregon: Contest, Sweepstakes and Prize Notification Rules – Or. Admin. R. §§ 137-020-0410 to 137-020-0460 (2006). Rhode Island: Prizes and Gifts Act – R.I. Gen. Laws §§ 42-61.1-1 to 42-61.1-9 (2006); Games of Chance Registration Act – R.I. Gen. Laws §§ 11-50-1 to 11-50- 8 (2006). South Carolina: Prize and Gift – S.C. Code Ann. §§ 37-15-20 to 37-15-100 (2006). South Dakota: Sweepstakes Prizes – S.D. Codified Laws §§ 37-32-1 to 37-32- 18 (2006). Tennessee: Promotions or inducements to sell goods, services or other products – Tenn. Code Ann. § 47-18-120 (2006); Prizes – Tenn. Code Ann. § 47- 18-124 (2006). Texas: Contests and Gift Giveaways – Tex. Bus. & Com. Code Ann. §§ 40.001 – 40.005 (2006). Utah: Prize Notices Regulation Act – Utah Code Ann. §§ 13-28-1 to 13-28-9 (2006). Vermont: Contests and Sweepstakes – Vt. Stat. Ann. tit. 13 § 2143b (2006). Virginia: Prizes and Gifts Act – Va. Code Ann. §§ 59.1-415 to 59.1-423 (2006). Washington: Promotional Advertising of Prizes – Wash. Rev. Code §§ 19.170.010 to 19.170.900 (2006). West Virginia: Prizes and Gifts Act – W. Va. Code §§ 46A-6D-1 to 46A-6D-10 (2006). Wisconsin: Prize Notices – Wis. Stat. § 100.171 (2006). Wyoming: Promotional Advertising of Prizes – Wyo. Stat. Ann. §§ 40-12-201 to 40-12-209 (2006).
Follow Federal & State Legal Requirements and Regulations. Please always consult with a real legal advisor and/or licensed attorney. This is simply a guideline to get you started in the right direction.