Tennessee law defines the legality of gambling through specific and restrictive statutes. The state permits certain activities while broadly prohibiting others, creating a distinct legal landscape for residents. This overview clarifies which forms of gambling are allowed and which are forbidden under current state law.
Legal Forms of Gambling in Tennessee
Tennessee authorizes a few specific forms of gambling for the public, each governed by state regulations. The most prominent is the state lottery, operated by the Tennessee Education Lottery Corporation, which offers games like Powerball, Mega Millions, and various scratch-off tickets. Individuals must be at least 18 years old to participate. While tickets are available at over 5,300 retail locations, the state also offers online sales through its “Anytime Powerball” app.
Another legal option is online sports wagering, available to individuals 21 years of age or older who are physically located within the state. Tennessee’s model is exclusively online, meaning there are no physical sportsbooks. All operations are overseen by the Sports Wagering Council (SWC), which licenses and regulates mobile betting applications. Tennessee is the only state that taxes licensed sports betting operators on their total betting handle, with the rate set at 1.85%.
Fantasy sports contests are also permitted and regulated in Tennessee. Major daily fantasy sports operators offer products legally within the state.
Charitable Gaming Regulations
State law provides exceptions for bona fide nonprofit and charitable organizations to conduct certain gaming activities for fundraising purposes. These activities are outlined in the “Tennessee Charitable Gaming Implementation Law” and include events such as raffles, reverse raffles, and cakewalks. Notably, games commonly associated with casinos, like roulette or slot machines, are expressly prohibited even for charitable purposes.
To legally operate a gaming event, a nonprofit organization must have been in continuous existence in Tennessee for at least five years. The organization must submit an application to the Secretary of State between July 1st and January 31st for an event in the following fiscal year.1Justia. Tennessee Code § 3-17-104 – Annual Event Application Requirements Application fees can be up to $700, and all proceeds from the event must be used to benefit the organization’s charitable mission.
There are limits on prizes, with the maximum for a single raffle prize being $250,000, though this does not apply to real property.
Prohibited Gambling Activities
Tennessee law, under Tennessee Code Annotated § 39-17-502, broadly prohibits any gambling not explicitly authorized by the state.2Justia. Tennessee Code § 39-17-502 – Gambling – Defenses The state does not permit the operation of any physical casinos, and engaging in casino-style games for money is against the law.
The prohibition extends to unlicensed card games and poker rooms where participants risk money to win a prize. Similarly, the act of bookmaking, or taking bets on sporting events outside of the state-licensed online platforms, is illegal.
Furthermore, the possession or operation of illegal gambling devices is forbidden.3Justia. Tennessee Code § 39-17-505 – Possession of Gambling Device or Record This includes any machine or apparatus, such as an unlicensed slot machine, designed for gambling. The law is clear that any activity involving risking something of value on a game of chance, unless specifically permitted, constitutes illegal gambling.
Understanding Social Gambling Exceptions
Tennessee law provides a narrow exception for “social gambling,” which refers to gambling that takes place in a private setting among individuals, where no one is profiting from operating the game itself. The legal definition of gambling, under Tennessee Code Annotated § 39-17-501, is “risking anything of value for a profit whose return is to any degree contingent on chance.”
This exception applies to games in a private residence among friends, as long as the gathering is a “private social affair” and not a commercial operation. The primary element is that no “house” takes a percentage of the bets, and no admission fee is charged for the purpose of gambling.
The scope of this exception is limited and does not protect organized or promoted gambling events, even if held in a private location. If the activity begins to resemble a commercial operation, it falls outside this exception and becomes subject to the state’s general prohibitions on illegal gambling.
Consequences of Unlawful Gambling
Engaging in or promoting illegal gambling in Tennessee carries legal consequences, with penalties varying based on the nature of the offense. For a person caught participating in illegal gambling, the charge is a Class C misdemeanor, which can result in a fine of up to $50.
Gambling promotion is a Class B misdemeanor and applies to anyone who knowingly aids another to engage in gambling for an economic benefit.4Justia. Tennessee Code § 39-17-503 – Gambling Promotion This could include setting up a poker game with the intention of making money and carries a fine of up to $500.
More serious offenses, such as financing or supervising a gambling enterprise, are classified as aggravated gambling promotion and are treated as a Class E felony. A conviction for this offense can lead to one to six years in prison and a fine as high as $3,000. Additionally, possessing an illegal gambling device is a Class B misdemeanor.