Rules for Running an Online Contest - Nolo

The first thing to determine is whether your online giveaway is a sweepstakes or a contest. Most online giveaways are sweepstakes. A sweepstakes is a game of chance. Anyone can enter and the winner is selected randomly. In a sweepstakes, everyone has the same chance at winning. If you own a coffee shop and … See more

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FAQs about Rules for Running an Online Contest - Nolo Coupon?

Should you run a contest?

Running a contest is a great way to increase customer engagement and promote your business. People get excited about product giveaways and the opportunity to win prizes. But it's not all fun and games. Before you launch your online contest, you need to consider and create the giveaway rules. ...

What are online contest rules?

Your online contest rules should inform contestants that winners are liable for any and all taxes related to their prize and that winners will receive a Form 1099 from the IRS requiring them to declare the amount of their winnings. Many states have their own laws and regulations governing online contests. ...

Do online contests have rules and disclosures?

Most notably, federal laws against online gambling and private lotteries require contests and sweepstakes to have particular rules and disclosures. In addition, different state laws and social media sites can define the parameters of online contests differently. ...

Are online contests legal?

Many states have their own laws and regulations governing online contests. For instance, California prohibits the use of the word "lucky". Each state usually has information about contest rules on their official websites. You should design your contest to meet the most restrictive state rules. Always include a "void where prohibited" disclaimer. ...

Do contest laws apply to online giveaways?

As social media and the internet use is at an all-time high, online promotions and giveaways allow businesses the opportunity to reach a much broader group of consumers and potential participants. This article examines how traditional contest laws apply to online giveaways and new considerations specific to the online nature of the contests. ...

What laws apply to online contests & sweepstakes promotions?

In the United States, the most significant federal law relating to contest and sweepstakes promotions is the Deceptive Mail Prevention and Enforcement Act, 39 U.S.C. 3001. However, this law only applies to those promotions made available via direct mail, and it therefore does not apply to online contests. ...