How it works
Everyone can buy LottoStocks
Everyone is a potential LottoStocks consumer; there is no age or other restriction or requirement. All that is needed is a minimum of $1.00 to invest.At POS lottery terminals, the consumer is given the option to purchase LottoStocks. Like most lottery tickets, LottoStocks is also issued in units of $1.00.
Two kinds of LottoStocks purchases
There are two kinds of LottoStocks purchases:
1) Account purchases; and
2) Non-account purchases.
Account purchases. Although it will not be required in order to purchase LottoStocks tickets, the consumer will have had the prior opportunity to open up a LottoStocks account by providing his name, address, phone number, date-of-birth, and Social Security number. He would have been given a LottoStocks account card with either “swiping” abilities, just like a credit or debit card, and/or a bar code. Upon purchase, the clerk at the POS terminal will first swipe or scan the consumer’s LottoStocks account card which will then telecommunicate the purchase to a remotely located Central Control Unit (CCU) which will register the purchase in the account-holder’s account. The confirmation of the purchase will then be telecommunicated back to the POS terminal which will print out a receipt in the form of a “ticket”, resembling a lottery ticket, which will then be given to the account-holder.
Non-account purchases. If the consumer does not have a LottoStocks account -- and therefore no card -- he can still purchase a LottoStocks ticket but it will not be issued on his account because, of course, he doesn’t have an account. The CCU will record this anonymous purchase and identify it with a purchase number unique to that purchase. The only “proof of purchase” will be the ticket itself that is issued to the consumer. The opportunity to open an account subsequent to purchase will, of course, always be available as well as the ability to transfer the investments recorded on prior-bought tickets into it.Non-account-holders will only be able to cash out of their investments by first opening up an account and then transferring their previously purchased investments into their account. This is necessary because the investment very well may have earned gains which must be communicated to the Internal Revenue Service and the appropriate tax record, such as a 1099, for inclusion with income tax filing sent to the client.
Note, however, that all LottoStocks purchases are tax-deferred instruments and, as such, will not require tax reporting until withdrawals or surrender is attempted, which, as noted above, can only be done only after an account has been created.
Tracking. As is the case with investments placed with traditional financial institutions, LottoStocks consumers will be able to track the progress of their investments’ growth. This will be accomplished on-line, via an annual statement mailed to the client, or by inquiring through the telephone to customer service.Transfers. Both qualified and non-qualified sub-accounts will be available for LottoStocks investments as well as the ability to transfer funds between them. However 100% of all purchases at POS terminals will be non-qualified. Qualified accounts can only be created -- and transfers made to them -- through Customer Service. Customer service will not be performed at POS terminals. Note that once LottoStocks accounts have been opened, the ability to transfer non-LottoStocks investments into LottoStocks accounts will be possible.