Sweepstakes FAQ

In the U.S., sweepstakes sponsors are very careful to disassociate themselves from any suggestion that players must pay to enter, as this would bring them into conflict with federal lottery laws.

Sweepstakes typically involve enticements for a consumer to enter a sponsors’ promotion for prize that range from fantastic wins such as cars or large sums of money to smaller prizes that are currently popular with consumers in the United States such as Apple iPods. These enticements can include purchase of a product, signing up for email, or being a member of a certain loyalty club.

But, there should be no monetary cost to the entrant to participate in the sweepstakes prize drawing. There should always be an alternative way available in the rules to enter a U.S. sweepstakes without cost. Many times this will involve using regular mail for your entry, or to send in to receive a unique code which would then allows you to enter.

Winners should never be required to pay a fee of any type to receive their prizes. However, that doesn’t mean that acceptance of a prize will be “cost free”. In the U.S., you will report and pay income taxes on the fair market value of any prize that you win. Additionally, when winning a prize such as a trip, there will be portions that you will have to pay as not all trip wins cover things like food, some transportation costs, and incidentals.