Time trials are fast, fun, and simple to understand. It could be racing games, sports, or anything skill-based, beating the clock is exciting. That excitement only grows when there’s real cash on the line, which leads to a tricky question: Is it legal?
The short answer? It depends on where you live and how the contest is set up.
What Counts as Gambling?
In the U.S., most laws break down gambling into three parts: a prize, a fee to enter, and chance. If all three are present, it’s gambling. However, if one is missing — like chance — it’s usually not considered gambling at all.
That’s where skill-based games come in. If you’re entering a time trial where the fastest person wins because of skill, like good driving, sharp reflexes, or fast thinking, that might be perfectly legal.
Popular sites like Bovada and its alternatives are known for offering a variety of skill-based contests, including things like NFL pick’em tournaments, where success is tied more to knowledge and timing than luck. As explained by Esports Insider expert Viola D'Elia, these platforms are especially appealing to players looking for flexible, user-friendly ways to engage in legal online competition, even though access may vary by state.
Skill vs. Chance: What’s the Difference?
This is where things get a little technical. Some states follow what’s called the “dominant factor test.” If skill is the main reason someone wins, then it’s legal. That applies to most time trials where practice, precision, and reaction time matter more than luck.
Other states follow the “material element test.” Here, even a small role of chance can make it gambling. That means a time trial with a random obstacle or bonus item could be considered illegal in those places.
So, in some states, time trials are fine. In others, they might not be, depending on how the game is built.
What Does Federal Law Say?
There’s no federal law that bans skill-based tournaments. The Unlawful Internet Gambling Enforcement Act (UIGEA) only blocks financial transfers for illegal gambling. If your time trial is based on skill and follows your state’s laws, then federal rules won’t stop you.
With that being said, it’s worth remembering: federal law can still come into play if your tournament spans multiple states. That’s why many organizers play it safe by only accepting players from legal states or by offering no-entry-fee events.
Where Are Skill-Based Tournaments Legal?
Most U.S. states allow time trials with cash prizes if they’re based on skill. However, there are exceptions. Some states either ban them outright or have heavy restrictions. These include Arizona, Arkansas, Colorado, Connecticut, Delaware, Florida, Kentucky, Louisiana, Maine, Maryland, Mississippi, Montana, Nebraska, New Hampshire, New Mexico, South Carolina, Tennessee, Puerto Rico, and Washington.
Even in states that allow them, local laws and prosecutors can make things tricky. That’s why it’s smart to talk to a lawyer before starting a big event, especially if it involves large cash prizes or players from multiple regions.
Who Pays the Prizes?
There’s a legal difference between tournaments where the prize money comes from player entry fees and ones funded by a sponsor or organizer. It’s usually safer, legally speaking, if the organizer puts up the prize. That way, the event isn’t seen as a bet or a pot collected from players.
Also, any cash prize over $600 has to be reported to the IRS. Organizers must use Form W-2G, and players have to pay taxes on their winnings.
Keep It Safe and Smart
Before you enter or run a time trial for money, make sure you’re not breaking any rules. You start, check your state’s gambling laws, make sure the event is mostly skill-based, and avoid adding random elements that could count as chance. You should also use clear rules and fair judging, in addition to talking to a lawyer if you’re unsure.
For more help understanding local rules, the National Conference of State Legislatures offers great resources. You can also look at IRS guidelines on prize winnings to make sure you're tax-compliant.
Conclusion
Time trial tournaments with cash prizes are legal in many parts of the U.S., but only when they’re contests of skill rather than luck. State laws can vary a lot, and local rules might add extra layers. If you’re planning to host or enter one, do your research first. Follow the rules, keep it fair, and make sure the competition is all about skill. That way, the only thing you’ll need to worry about is shaving seconds off your time.