Nev. Admin. Code § 372.367 — 372.367

NAC 372.367    Property purchased for use as prize in raffle, contest or game of
chance. ( NRS
360.090 , 372.725 )
1.  A person who purchases tangible personal
property for the purpose of awarding the property as a prize to the winner of a
raffle, contest or game of chance is considered to be the purchaser or consumer
of that property for purposes of the sales or use tax. Except as otherwise
provided in subsection 2, that person shall:
(a) Pay sales tax to the retailer; or
(b) If the property is acquired from a retailer
outside this State who is not registered to collect sales and use tax for the
State of Nevada, remit use tax to the Department at the time of purchase.
2.  A retailer holding a Nevada seller’s
permit who is informed by the purchaser that the tangible personal property is
being purchased for the purpose of awarding it as a prize to the winner of a
raffle, contest or game of chance may collect the sales tax from the winner of
the prize in lieu of the purchaser if:
(a) The retailer and the purchaser agree by
contract that the retailer will retain title, possession and risk of loss of
the property until the prize is awarded;
(b) The winner of the prize takes possession of and
title to the property at the retailer’s place of business; and
(c) The rules of the raffle, contest or game of
chance state prominently and specifically that the winner of the raffle,
contest or game of chance will be required to pay Nevada sales tax upon receipt
of the property given as the prize.
3.  A retailer who collects sales tax from
the winner of a prize pursuant to subsection 2 must base the amount of the tax
collected upon the sales price of the property to the purchaser, regardless of
whether a sale of the prize to the winner would be exempt from the tax. If the
winner of the prize elects to substitute another item of tangible personal
property which is offered for sale by the retailer, the tax due will be
calculated on the basis of the higher priced item.
(Added to NAC by Tax Comm’n, eff. 8-23-96)