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In Michigan, you can not pay out any CASH prizes. There are lots of other rules, too. They make it almost impossible to host a charity poker event. Every state is different, though. If you are serious about the idea, you need to involve an attorney.
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Actually, in Michigan you only have to obtain a license that it is a charity event for a licensed non-profit organization. I'm sure that there are a lot of other "rules" but the one that I know for sure is that you can't pay any individual more that $500 in a day. The one that I have played before halted play when it got down to the final 2 people, pay them what they were guaranteed to win so far, and then bring them back the next day to finish up (since the 1st place finish received $1000). There is another one next weekend.
Charity poker tourney October 15th in Williamston, Michigan