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Taking your tax chances on raffle tickets

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in Small Business Tax,Small Business Tax Deduction Strategies

Q.  If I buy a $100 raffle ticket for charity and don’t win, can I deduct the full amount? D.G., Schenectady, N.Y.

A.  No. In fact, you’re not entitled to any charitable deduction for raffle tickets you purchase, even if the raffle is sponsored by a tax-exempt organization. The IRS treats raffle tickets as a gambling activity. However, you would be allowed to deduct the cost of a raffle ticket if you donate the ticket back to the charity so it can be re-sold. In that case, you have zero chance of winning.

Tip: The IRS provides a list of contributions you cannot deduct in Pub. 526, Charitable Contributions. View it at www.irs.gov/pub/irs-pdf/p526.pdf.

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