Auction Frogs recently attended a fundraiser where venue staff was required to remove beer and wine from silent auction baskets. Unfortunately, the nonprofit hosting the fundraiser didn’t have a license to sell alcohol. And, if you don’t know the laws that may apply to your next fundraiser, you could find yourself in a similar situation.
While we are certainly not legal counsel, Auction Frogs can provide some general guidance on where to start your research. Read more below about the four most common laws that may apply to your next fundraiser
Sales Tax Laws & Reseller's Permits
Sales tax laws are not black-and-white. While many nonprofits are exempt from paying sales tax, they may not be exempt from collecting it. If your local laws require you to hold a reseller’s permit and to collect sales tax, that likely applies to sales you make at your fundraiser. But, if you sell items infrequently, a temporary seller’s permit may be an option for you. Check with your local Tax Commission to ensure you are in compliance with both local and state law.
Beer & Wine Sales
If you plan to sell or serve beer or wine at your fundraiser you will likely need to secure a license to sell or serve alcohol, even if the alcohol is donated. All states will have different license requirements and fees, and the approval process may take quite a bit of time. So, be sure to check with your local Alcohol Beverage Control agency for more information well before your license will be needed!
Raffles & Lottery Laws
Does your state require a license to hold raffles? Idaho does. The application process is thorough but typically inexpensive. If a raffle, bingo, or other “game-of-chance” is a planned part of your fundraiser, play it safe. Placing a quick call to your local Lottery Commission can better prepare you and save you thousands of dollars in fines.
Text Message Restrictions
When sending bulk text messages using Auction Frogs’ platform or some other service, beware that rules apply. First, make sure your messages do not include any words and phrases forbidden by the FCC. Second, be aware that there are regulations regarding the volume of messages sent and limits to the number of characters those messages can contain. Cell phone carriers are obligated to filter and control the content sent to their customers. If a user reports your messages as spam, it could affect the deliverability of all your future messages.
Get Started Today
Our goal is to help your fundraiser run as efficiently as possible. Knowing your laws can save you valuable time and money. So be sure to consult your legal counsel, accountant, and local agencies for best practices and to check any necessary permits off of your list.
Get in touch today to see how we can help make your next fundraiser a successful one!
About the author
Auction Frogs
Auction Frogs streamlines your fundraising process by giving live and silent auctions a digital backbone. Reduce hassles, save valuable volunteer time, and increase your revenue raised. We deliver unique technology to simplify the experience of hosting a successful fundraiser.
