Sweepstakes have fabulous prizes that drive people to businesses they’ve never been to, just for a random shot at winning. And when they do win, it’s the most exciting feeling in the world.
Sweepstakes hosts have a legal obligation to ensure winner’s with prizes over $600 understand the tax implications of the prize they have. An affidavit of eligibility, liability and publicity release is an all-important legal document that not only ensures the winner is made aware of their obligations in accepting the prize, but protects the sponsor from any additional liability.
Understanding Sweepstakes
Sweepstakes are free-to-enter giveaways often hosted by businesses to build relationships with customers. Though entry into sweepstakes must always include a cost-free entry method, the sign-up terms and prizes vary each time.
Federal organizations like the FTC, FCC, and USPS set legal rules and regulations for sweepstakes. And one of their most important regulations is that sweepstakes hosts must establish minimum eligibility requirements to win the prizes, regardless of value.
Your age, location, and several other criteria determine whether you’re eligible for a sweepstakes prize. While setting those criteria is a federal standard, it’s up to the host to decide what the specific rules are. For example, a sweepstakes host could determine that you have to live within one mile of their business to be eligible, while another might set the mark at 100 miles.
Understanding The Affidavit of Eligibility
Affidavits of eligibility are documents that legally confirm that you meet the eligibility terms that the sweepstakes require. Sweepstakes hosts issue these forms to giveaway winners to verify their identity matches the requirements of the sweepstakes and give tax information to winners of awards over $600.
Each affidavit of eligibility changes depending on the sweepstakes host, the prize, and the sweepstakes winner on occasion. However, since each serves the same purpose of confirming a winner’s identity, they’ll all contain at least the following terms:
- Confirmation of age
- Confirmation of location (address, street, city, zip code, etc.)
- Confirmation that you’ve reviewed the affidavit and sweepstakes eligibility requirements meet the additional criteria
Do Winners Need To Sign an Affidavit of Eligibility For Every Sweepstakes?
If the Entrant has won a sweepstakes with a prize over $600, that winner will need to sign an affidavit of eligibility. In fact, the sweepstakes host can disqualify a winner from winning if they refuse to sign the document.
Sweepstakes have several eligibility requirements like age and place of residence that entrants must meet to enter. And the affidavit of eligibility is the sweepstakes host’s only way to confirm that the winner meets those requirements legally.
Affidavits often require official notarization for approval. And because both the sweepstakes host and sweepstakes winner benefit from transferring the winnings, with the winner receiving the prize and the host improving their customer relations, the notary needs to be a neutral third party to ensure the person signing the affidavit is who they say they are.
Learn More About the Affidavit of Eligibility at The National Sweepstakes Company
Our team at the National Sweepstakes Company helps businesses put on successful sweepstakes while helping them navigate the confusing clerical work like drafting an affidavit of eligibility.
Contact us today or call 888-744-3217 to learn more about affidavits of eligibility and get started on your sweepstakes.