Is it legal to run an online competition and give away cash prizes in the United States?

UPDATED: Jun 26, 2014

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Is it legal to run an online competition and give away cash prizes in the United States?

Cash prizes will be $1000. Also, are minors allowed to collect this prize or can their parents vouch for them? Additionally, if the first try for the competition is free, and then I charge a small fee, is that illegal?

Asked on June 26, 2014 under Business Law, California


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Based upon what you have written about you will need to consult with the laws of each state and county to do what you desire. Each state has its own laws on the subject and each county as well. Based upon what you have written about your venture may be deemed an illegal gambling operation under vatious state laws. I suggest that you consult with an attorney in your locality on the subject. One can be found on

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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