St. Jude Dream Home raffle tickets are not tax deductible. The IRS specifically bars charitable deductions for money spent on raffle tickets, lottery tickets, bingo, and other games of chance, even when a qualified nonprofit runs the game.1Internal Revenue Service. Publication 526 – Charitable Contributions Your $100 buys a chance to win a house, and that chance counts as something of value received in return for your payment.
Why the IRS Says No
A charitable contribution has to be voluntary and made without receiving something of equal value back. IRS Publication 526 puts it directly: “You can’t deduct as a charitable contribution amounts you pay to buy raffle or lottery tickets or to play bingo or other games of chance.”1Internal Revenue Service. Publication 526 – Charitable Contributions Buying a ticket gives you a shot at a home that could be worth $500,000 or more. That opportunity is the value that disqualifies the payment.
The rule applies to the full $100, not part of it. With some charity benefit events, you can deduct the portion of your payment that exceeds the fair market value of what you received, such as a meal at a fundraising banquet. Raffles do not get that treatment. St. Jude Children’s Research Hospital is a legitimate 501(c)(3), and direct gifts to it are fully deductible, but the raffle ticket is a separate transaction the tax code treats as gambling.
The One Narrow Exception: Gambling Losses
There is a limited scenario where the ticket cost can reduce your tax bill. The IRS lets you deduct gambling losses against gambling winnings, and raffle tickets count as gambling expenses for this purpose.2Internal Revenue Service. Topic No. 419, Gambling Income and Losses If you won $3,000 at a casino during the year and lost $500 across various bets including your Dream Home ticket, you could deduct that $500 against the $3,000 in winnings.
Two conditions limit this. First, losses can only offset winnings, never exceed them. With no gambling winnings for the year, the ticket does nothing for your taxes. Second, the deduction requires you to itemize on Schedule A instead of taking the standard deduction.2Internal Revenue Service. Topic No. 419, Gambling Income and Losses For 2026, the standard deduction is $16,100 for single filers and $32,200 for married couples filing jointly.3Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026 Most taxpayers do better with the standard deduction, which makes the gambling loss route useful only to filers who already have enough itemized deductions to clear that threshold.
If you go this route, the IRS expects an accurate diary or similar record of all your gambling activity for the year, along with receipts, tickets, and statements showing both winnings and losses.2Internal Revenue Service. Topic No. 419, Gambling Income and Losses Keep the ticket stub and payment confirmation. With no documentation, a claimed deduction becomes a denied one under audit.
How to Make Your Support Actually Deductible
If the tax benefit matters, make a separate direct donation to St. Jude alongside or instead of buying a ticket. Contributions to a qualified 501(c)(3) made with no expectation of receiving anything in return are deductible for taxpayers who itemize.1Internal Revenue Service. Publication 526 – Charitable Contributions The gift has to be a genuine donation with no raffle entry or prize drawing attached. Report it on Schedule A. For any single contribution of $250 or more, St. Jude will provide a written acknowledgment.
You can do both in the same year. Buy a ticket and make a separate donation. The ticket stays non-deductible, the donation stays deductible, and the two transactions have to be clearly distinct. Families never receive a bill from St. Jude for treatment, travel, housing, or food, so the money supports the same mission either way.4St. Jude Children’s Research Hospital. Cost for Families
What Happens if You Actually Win
Winning the house creates a tax bill that catches many people off guard. The IRS treats all gambling winnings, including raffle prizes, as fully taxable income.2Internal Revenue Service. Topic No. 419, Gambling Income and Losses The taxable amount is the home’s fair market value at the time you win. Dream Home values vary by market but commonly land between $400,000 and over $700,000. That amount gets added to your other income for the year, and you owe federal income tax on the total at your applicable rate. Most states also tax the prize.
St. Jude reports the prize to the IRS on Form W-2G, the standard form for raffle winnings from tax-exempt organizations. Because the prize is noncash, taxes cannot be withheld the way an employer withholds from a paycheck. You have to pay the withholding directly to St. Jude, which then remits it to the IRS on your behalf.5Internal Revenue Service. Notice 1340 – Tax-Exempt Organizations and Raffle Prizes – Reporting Requirements and Federal Income Tax Withholding The federal withholding rate is 24%.6Internal Revenue Service. Instructions for Forms W-2G and 5754 For a home valued at $600,000, that is roughly $144,000 out of pocket before you get the keys. And that only covers the federal withholding portion; state tax and any remaining federal liability from your combined income can add more.
This is why some winners end up selling the house or declining the prize outright. St. Jude has stated that winners who cannot come up with the withholding can turn the prize down. Anyone buying a ticket should treat a win as an immediate five- or six-figure cash obligation, not simply a free house.