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What is the best raffle strategy?

What if a raffle for a real estate property(like home) is conducted from Non-US country for a property based in United States ?

  • Two main points of the discussion conducting a raffle , 1.Operating my website from non US country while living in a non US country. 2.Should be using  Bitcoin as a payment service provider or not I want to conduct a raffle online for a home which is in United States ,but the website will be based in another country which does not prohibit conducting a raffle in United States.Moreover I want to conduct raffle using Bitcoin.I am a non-US citizen not living in US.I have contacted many brokers of United States and they are ready to go with this plan.Moreover I am in the process of contacting celebrities,however one celebrity is ready to sell her home. I asked other question here yesterday.but came to know about different laws and statutes in different states of US. I plan to sell the house via people paying using bitcoin but not sure.Because when I conduct a raffle it will be illegal in some states of U.S,and because I am a  for profit organization and not a charity. Bitcoin is a digital currency so I think there would be no problem selling the home outside United States.And the people betting on the home would be from different countries. Even If we don't use bitcoin we are running a raffle from a Non U.S country,So will that be a problem.

  • Answer:

    Bitcoins are not legal tender in the US. Conveyance taxes, recording fees and all related settlement expenses would need to be in US Dollars. The IRS would likely raise some questions relative to capital gain tax, assuming the sale price was above the seller's basis and greater than tax preferences allowed on the sale of a primary residence, assuming it is a primary home. If not, the IRS will have fun with the seller who must settle in US currency. If I were the buyer and I had a seller willing to take non-sovereign currency, I would insist that the transaction settlement be for $1 US plus other consideration to ensure the contract is legally binding. I would also insist that the seller have legal counsel to limit the opportunity for the seller to claw back the transaction based on fraud claims (stupidity is not cause for legal action). Good luck.

Michael Dell Orfano at Quora Visit the source

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You have two main concerns, legality and market acceptability.  For the legal question, please contact a real estate attorney.  My take on that aspect is this: Bitcoins do have value, however dubious, and real estate contracts need to have valuable consideration.  I've never personally seen this done but I'm sure history will show properties being sold for non-cash consideration- cars, boats, planes, stocks, bonds, etc.  I'm sure that as far as taxes go the government will want to know the dollar value of the consideration and will apply taxes accordingly. For market acceptability you generally get the most money buy attracting the most buyers.  By limiting the buyer pool to those who know and can get a hold of large amounts of bitcoins you are seriously limiting your buyer pool.  This part of it does not sound like a good idea to me.

Bryan Myers

I am still not clear whether you will have an independent real estate broker who resides in the US facilitating the raffle and related paperwork to effect the transaction.  There was a tax memorandum a few years back where a foreign company originated loans in the US using Independent US mortgage broker was found to have ECI subject to US tax. I would certainly seek advice of a tax CPA who has international tax experience to make sure: 1. The income generated from this proposed transaction is not ECI to you (Effectively Connected Income) on which US tax is required. 2. You, your US real estate broker, and title company are aware of withholding requirement and associated paperwork if the income is found to be ECI. Good luck.

Suzanna Lam

One is the legal angle which I am sure people more qualified than me can help you out with. As far as the pulse of the market goes I dont think you would have much luck convincing Indians to purchase properties in US of A - while they maybe cheaper , there is an emotional side to it as well. For most Indians a house is a lifetime buy and not too many would be interested in risking that even in the slightest.

Harsha Shastry

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