just let her do it on her own. dont do contests. they rip people off and rob you of your money. shes 12. first of all, the chances of her actually becoming a famous author are almost impossible.
what you can do is have her write stories for other children you know, it would make a good gift! just let her be herself, let her do what she wants to do with it, you and your whole social circle might think shes uber talented, but the hard nosed world out there might think shes not.... so let her journey into the world of writing as an adult whos more prepared and equipped for rejection - if she gets into it now all the rejection could set her up to fail and lose the love that she has for writing.
i would never get a child involved in something for more than just a hobby - not even competitive sports in high school or whatever - it may be a big deal for school teams and coaches and most parents, but if you let her know that its just for fun, winning or losing doesnt matter, and let her just take her own journey, shes going to love it more and perhaps have more success than if she was doing it like it were here job.
what i would do is let her take community education classes, make sure she gets english (which is required anyway) and art classes in school. if the newspaper in your area has a contest, great, if not, dont seek out too many of these kinds of opportunities, they are usually scams (my friend did and she lost some major $)
start researching now if you feel right about it different colleges that support art and have great art programs. as she gets older, she can do visits to art shows, start communicating with the art departments, even the art students. one college i know has an awesome art program (because i went there for a year) is the university of minneosta in morris, mn. they are FANTASTIC. if you live close to this area, contact the art department there, and ask about art shows or sales that they do. you will be amazed at the stuff they sell - its a great way to support college kids - and a great way to get her excited and perhaps focused on doing well, so she could get into a college like that.
:D
anyway, dont push anything. let her explore. perhaps form a group of kids who are interested in writing. see if your daughter would tutor kids who want to write or draw (im sorry if i keep forgetting that part) - your daughter could even hold her own community education class - i did one my self when i was 13 or so... or she could start a drawing group or something like that. dont schedule so tightly that she has no free time. that can squash her inspiration. let her be out in nature. bring her to beautiful sights such as waterfalls or etc. :D
just dont worry about getting her noticed or anything like that. the most sincere way of becoming noticed is having people come to her, not the other way around.
perhaps she has a future as an artist, art teacher, graphic design.... but worry more about her doing something she loves, and finding a way to get paid doing it when she grows up, than you do about getting her noticed. :D she will be more happy to be a starving artist than a pressured celebrity. :D