Nebraska Lottery and Rafe Information Guide, July 22, 2021, Page 3
Ticket Requirements. Tickets for a licensed lottery or rafe must be constructed as a two-part ticket, with
a detachable stub. The tickets and the detachable stubs must each contain a unique sequential number.
Additionally, the tickets must contain, at a minimum, the following information:
❖ Name and state ID number of the licensed organization;
❖ Cost per ticket;
❖ Date on which winners will be determined; and
❖ A statement indicating whether or not the winner must be present when winners are determined.
See sample tickets on page 5 of this guide.
Winner Determination. The winners for a licensed lottery or rafe can be determined only by a random
drawing of the tickets, or by a race using inanimate, buoyant objects oated along, for example, a river or
canal. No other methods of winner selection are allowed.
Use of Prots. The prots from a licensed lottery or rafe must be used for a lawful purpose as dened in
the Nebraska Lottery and Rafe Act and regulations. For more information regarding lawful purpose use
of proceeds, please see Reg-35-401, Lawful Purpose.
Reporting and Tax. Lotteries exceeding $1,000 and rafes exceeding $5,000 are subject to a two percent
state tax on gross proceeds. The tax is due on or before September 30 of each year. Tax returns are
automatically sent to the licensed organization. The licensed organization is also required to le a Lottery/
Rafe Annual Report, Form35B, which is due by August15 of each year.
Online Lotteries and Raffles
Online lotteries and rafes permit qualifying nonprot organizations to sell lottery and/or rafe tickets
through their website. Tickets may be purchased with cash, check, or debit card. Credit card purchases
are not authorized. If the proceeds from lottery/rafe ticket sales are initially processed through another
account in the name of your organization, it is required that all proceeds must be transferred into the
lottery/rafe bank account as soon as possible.
Ticket Requirements. Tickets for a licensed lottery or rafe must be constructed as a two-part ticket, with
a detachable stub. The tickets and detachable stub must each contain a unique sequential number and
be the same size, shape, and weight. For tickets sold electronically, the stubs must be detached, scanned,
and emailed to the purchaser. The tickets must be kept in a safe location until they are placed in the
receptacle for the drawing to determine thewinner.
Winner Determination. The winners for a licensed lottery or rafe can be determined only by a random
drawing of the physical tickets, or by a race using inanimate, buoyant objects oated along, for example, a
river or canal. No other methods of winner selection are allowed.
Small Lotteries and Raffles
The Nebraska Small Lottery and Rafe Act permits qualifying nonprot organizations to conduct, without
a license, one small lottery per calendar month which does not exceed $1,000 in gross proceeds, and
an unlimited number of small rafes per month provided the total gross proceeds from all the rafes
combined do not exceed $5,000 per calendar month. It is important to understand that if you begin
conducting a lottery or rafe under the Nebraska Small Lottery and Rafe Act, you must stop selling
tickets when you reach the $1,000/$5,000 gross proceeds limits; you cannot upgrade a small lottery or
rafe to a licensed lottery or rafe once ticket sales have begun.
Eligibility. To be eligible to conduct small lotteries and rafes, an organization must: (1) be organized or
incorporated in Nebraska as a nonprot organization or corporation and have tax exempt status under
IRC § 501; or (2) be an organization whose major activities, exclusive of conducting any lottery or
rafe, are conducted for charitable or community betterment purposes. Additionally, to be eligible an
organization must also have its principal ofce located in Nebraska.