Charitable Games Tax & License Fees

• Statutory - 230 ILCS 30/1 to 30/15
• Regulations - Part 435

The tax is imposed on the net proceeds of charitable games. Annual license fees are imposed on suppliers and providers of such games. Operators must pay a license fee every two years.

Fourteen games are permitted: bang, beat the dealer, big six, blackjack, chuck-a-luck, craps, five-card stud poker, gin rummy, hold-em poker, keno, merchandise wheel, poker, pull tabs, and roulette. Profits from the games must be used to support the organization’s goals, such as charitable work or education. A licensed organization may hold up to four charitable game events per year.

For a group to be eligible to conduct charitable games, it must

• be a religious, charitable, educational, veterans’, fraternal, or labor organization;
• have been in existence in Illinois for at least five years (may be reduced to two years in certain circumstances);
• operate without profit to its members; and
• already be exempt from federal income taxation under Internal Revenue Code, Section 501(c)(3), (4), (5), (8), (10), or (19).

Licensed organization (operator) means a qualified organization that has obtained a license to conduct a charitable games event in conformance with the provisions of this Act.

Provider means the person or organization owning, leasing, or controlling premises upon which any charitable games event is to be conducted.

Supplier means any person, firm, or corporation that sells, leases, lends, distributes, or otherwise provides to any organization licensed to conduct charitable games events in Illinois any charitable games equipment.

Volunteer means a person recruited by a licensed organization who voluntarily performs services at a charitable games event, including participation in the management or operation of a game.

Consultant company means any person that is hired by or on behalf of a licensed organization to perform services at the event (other than management or operation of the event), including, but not limited to, security for persons or property at the event (other than for the charitable games equipment and money, chips or scrip used in the conducting of charitable games), or to perform services before the event, including, but not limited to, training for volunteers or advertising.

Consultant companies include, for instance, "party planners" who plan an event for a licensed organization by locating and securing qualified suppliers and providers on behalf of the licensed organization, or who assist a licensed organization in planning a hosted casino night that is not open to the public (e.g., an event open to only a corporation and its clients that is hosted by the licensed organization and in return for which a donation is made to the licensed organization).

Illinois Department of Revenue Charitable Games Events Compliance Guidelines

These guidelines highlight important aspects of the law but is not an exhaustive list. 

Organizations eligible to hold charitable games must submit an application at least 30 days before the event. License fees must be paid when the application is filed. To apply for a license,

• qualifying organizations must submit Form RCG-1, Charitable Games Application for License, either electronically through MyTax.illinois.gov or by mail. The application must contain a sworn statement attesting to the not-for-profit character of the prospective licensee organization, signed by a person listed on the application as an owner, officer, or other person in charge of the necessary day-to-day operations of that organization. Note: A license is not assignable or transferable.
• You must also complete Forms RCG-2, List of Charitable Games Workers, and RCG-10, Diagram of Charitable Games Event Playing Area. If renewing, complete Form RCG-25, Expenditure of Funds Earned Through Charitable Games. Keep these forms in your records and make them available to us when we request them. After you have filed Form RCG-1 and you need to add or revise a scheduled event, you must complete Form RCG-1-E, Charitable Games, Bingo, or Pull Tabs Events Updates, 30 days before the event. Mail your completed information to the address on the form or email it to rev.bptcg@illinois.gov.

• The police department or sheriff’s office whose jurisdiction includes the premises at which the charitable games events are authorized under the license must be notified of all originally scheduled, added, changed, or cancelled events and a copy of that notification must be emailed to rev.bptcg@illinois.gov.
• No person except a bona fide member, employee, or volunteer of a licensed organization may participate in the management or operation of the games.
• Volunteers may only participate in 12 events per year.
• No person may receive any remuneration or compensation either directly or indirectly from any source for participating in the management or operation of the game, including employees of the operator organization.
• No single bet at any house banked game may exceed $20.
• When leaving, participants may cash in their chips in exchange for currency not to exceed $500 in cash winnings. Gift cards that have wide-scale acceptance (ex. Visa gift cards) are considered cash prizes. There is no limit on the amount of noncash prizes that may be exchanged for chips. Each participant shall sign a receipt for the prizes and the licensee shall make available to IDOR a list of all prizes awarded.
• Form RCG-18, Charitable Games Tax Return, must be filed within 30 days of the event in order to avoid penalties and interest. This form must be completed by the licensed operator or an accountant.
• Complete but do not submit Form RCG-32, Charitable Games Event Workers Attendance List, with Form RCG-18. Keep it in your records and make it available to us when we request it.
• Organizations must complete a report each year for the charitable games equipment they own on Form RCG-9, Application for Permit or Annual Report for Charitable Games Equipment Ownership. Keep it in your records and make it available to us when we request it.

• suppliers must submit Form RCG-7, Application for Charitable Games Supplier’s License, either electronically through MyTax.illinois.gov or by mail.

• No one other than the licensed sponsoring organization of charitable games may have a proprietary interest in the event. For example, a person who provides services to a licensed organization in connection with setting up a charitable games event may not receive as compensation for those services a percentage of the gross or net proceeds derived by the licensed organization.
• A supplier may have only one representative present at the charitable games event, for the exclusive purpose of ensuring that its equipment is not damaged and is functioning properly.
• No employee, owner, or officers of a supplier may participate in the management or operation of a charitable games event.
• A supplier may not provide volunteers at the charitable games event.
• A supplier may not promote or solicit a charitable games event on behalf of a charitable games licensee.
• All suppliers of charitable games supplies and equipment must complete Form RCG-24, Charitable Games Supplier Quarterly Report, even if you had no sales or leases during the quarter, within 20 days after the end of any quarter during which the supplier’s license was in effect.

• providers must file Form RB-30, Provider of Premises License Application, either electronically through MyTax.illinois.gov or by mail.

• May not have more than 12 events per license year.
• Must publicly display your Provider’s license at all Charitable Games events as well as the Operator’s license with the date and time of the event (copy of license provided by the licensed operator).
• Must notify IDOR of any changes with the licensed operator.

• No one other than the licensed sponsoring organization of a charitable games event may have a proprietary interest in the event.
• No employee, owner, or officer of a consulting service hired by a licensed organization to perform services at the event, (such as security for the persons or property) or services before the event (such as training for volunteers or advertising) may participate in the management or operation of the event.

Note: Violations of the above requirements could result in an organization’s license being revoked or civil penalties up to $250 for each violation being assessed against any individual involved (or both), as well as a referral to local authorities for prosecution for the offense of illegal gambling pursuant to section 28-1 of the Criminal Code of 2012. IDOR may require that any organization licensed under the Charitable Games Act obtain from an Illinois certified public accounting firm at its own expense a certified and unqualified financial statement and verification of records of such organization. Failure of a charitable games licensee to comply with this requirement within 90 days of receiving notice from IDOR may result in suspension or revocation of its license.

When applying for the equipment ownership permit, organizations must file Form RCG-9, Application or Annual Report for Charitable Games Equipment Ownership Permit, either electronically through MyTax.illinois.gov or by mail.

Organizations must complete a report each year for the charitable games equipment they own on Form RCG-9. Keep the report in your records and make it available to us when we request it.

• You must file a separate return, Form RCG-18, Charitable Games Tax Return, for each event. File your return within 30 days of the event either electronically through MyTax.illinois.gov or by mail.
• Complete but do not submit Form RCG-32, Charitable Games Event Workers Attendance List, with Form RCG-18. Keep it in your records and make it available to us when we request it.

 An application may include up to four events per year. However, if all four dates are not requested at application time, an organization may amend or add dates by requesting an amendment in writing at least 30 days prior to an event.

• Organizations conducting charitable games are required to pay a $400 license fee. Licenses are valid for two years.
• Suppliers of gaming equipment are required to purchase an annual license for $500 or $1,500 for three years.
• An annual “provider’s fee” of $50 or $150 for three years is imposed on anyone who rents space to be used for a charitable game.
  

Lookup Gaming Licenses using MyTax Illinois

1. What are the restrictions and limitations of cash prizes?
2. Who must be in charge of a charitable game event?
3. Who can manage a charitable game event?
4. What are the responsibilities of a Charitable Game supplier?

For additional information, contact the Central Registration Division weekdays between 8:30 a.m. and 4:30 p.m. using the contact information below.

OFFICE OF BINGO AND CHARITABLE GAMES 3-215
ILLINOIS DEPARTMENT OF REVENUE
PO BOX 19480
SPRINGFIELD IL 62794-9480

Email: rev.bptcg@illinois.gov

Phone: 217 558-7425

The management and operation of the event must be conducted only by members of the licensed organization, employees of the licensed organization, or volunteers recruited by the licensed organization. No officer, employee, or owner of a consulting service hired by the charitable games licensee may participate in the management or operation of a charitable games event under any circumstance. Activities that constitute "management or operation" of a charitable games event include:

• selling admission tickets
• selling or redeeming chips or play money or assisting in these activities
• participating in the conducting of any game played during the event. This includes dealing and/or acting as "pit boss".
• supervising, directing, or instructing anyone conducting a game
• counting or handling any of the proceeds, chips or play money at the event or supervising anyone doing so
• ensuring that the games are being conducted according to rules established by the organization

The following activities do not constitute “management or operation” of a charitable games event:

• setting up        
• cleaning up
• selling food or drink
• providing security for persons or property

For further information regarding the conducting of charitable games, refer to the Charitable Games Regulations, Section 435.170.