§ 23-114-504 - Use of net proceeds for charitable purposes.
23-114-504. Use of net proceeds for charitable purposes.
(a) A licensed authorized organization shall devote to the charitable purposes of the licensed authorized organization its net proceeds of games of bingo and raffles.
(b) Except as otherwise provided by law, the net proceeds derived from games of bingo and raffles are dedicated to the charitable purposes of the licensed authorized organization only if directed to a cause, need, or activity that is consistent with the federal tax exemption the licensed authorized organization obtained under 26 U.S.C. 501, as in existence on January 1, 2007, and under which the organization qualifies as a nonprofit organization as defined by law. If the licensed authorized organization is not required to obtain a federal tax exemption under 26 U.S.C. 501, as in existence on January 1, 2007, the licensed authorized organization's net proceeds are dedicated to the charitable purposes of the licensed authorized organization only if directed to a cause, need, or activity that is consistent with the purposes and objectives for which the licensed authorized organization qualifies as a licensed authorized organization.
(c) (1) The licensed authorized organization shall make mandatory annual or more frequent disbursements from the bingo and raffle account to the general fund of the licensed authorized organization after providing for appropriate reserves and funds necessary to pay for reasonable and necessary bingo and raffle expenses.
(2) Once funds are distributed to the licensed authorized organization general fund under subdivision (c)(1) of this section, no funds shall be returned to the bingo and raffle account except by means of a loan from the licensed authorized organization's general fund to the bingo and raffle account as evidenced by a written instrument.