10 Top Tips - Running Promotions in the USA
07 Mar 2017 Back

10 Top Tips - Running Promotions in the USA



America may be the land of the free, but running prize promotions there is not always plain sailing because different states have different laws. PromoVeritas have worked on many American promotions and are experts on all the issues and different requirements, so here are our ten top tips for running promotions in th USA:

  1. Prize draws, known as sweepstakes in the USA, can be linked to a product purchase.
  2. However in some States they need to be registered: in Rhode Island and New York it can take up to 30 days, in Florida just 7 days.
  3. Registration costs about $350 plus legal / administration fees.
  4. You will also need to buy an insurance bond that will pay out if the Promoter fails to deliver on their promises or goes bust.
  5. Promotions can operate a shared prize fund, shared with other countries.
  6. Prizes are unfortunately taxed as if they were ordinary income and Federal law requires direct payment of tax via form W9 on any prize worth more than $600. The Promoter to provides the form to the winner.
  7. If the prize is non-cash as a trip or a car the tax is based on the fair market value of each prize.
  8. You cannot give away alcohol or tobacco as a prize but guns are okay.
  9. You need to publish or make available a Winners List of names and full addresses of all prize winners that win a prize worth a value larger than $25.
  10. Cash is the most popular prize followed by cars and holidays.

To speak to one of our team about how we can help you bring your USA promotions to life, just as we have done for other global brands using expert team in the UK and the USA. Just give us a call +44(0)203 325 6000 or e mail Gemma Cutting info@promoveritas.com


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