(3) Is the payment made as a result of a contest or drawing?
Prize Policies
If you are awarding a prize to students for contests or drawings, all IU and IU Foundation policies apply irrespective of the funding source, or whether or not the winnings must be treated as a scholarship. If you are conducting (alone or with a sponsor or vendor) a contest or drawing for which a prize will be awarded, it is important that you review Indiana University policy FIN-ACC-640: Contests, Drawings, Games, and Prizes. Note that raffles, bingo, poker and other charity gaming are strictly prohibited.
In order to comply with IRS reporting regulations, any department or IU entity holding a drawing, game or contest must refer to Tax Standard Operating Procedure 9.03.