What are the two functions of a LOA?

What are the two functions of a LOA?

• A. A single administrative tool; B) A secondary document; C) Both A and B; D) It has no administrative purpose.
• B. Modality for the delegation of the CIR's investigatory power; B) A manifestation of due process; C) Both A and B; D) Neither.
• C. A traffic citation; B) A warrant for arrest; C) A request for information; D) None of the above.
• D. Modality for delegation of the CIR's investigatory power; B) A manifestation of due process; C) Both A and B; D) It serves neither function.

Answer: (D)

A Letter of Authority serves two purposes in tax investigations: it is a modality for delegating the CIR’s investigatory powers to the officers carrying out the inquiry, and it is a manifestation of due process, outlining the scope, authority, and procedural safeguards that ensure the investigation is legitimate and fair. In practice, this means the LOA authorizes specific officials to gather information, request documents, or compel response within defined limits, while also communicating the rights of the taxpayer and the boundaries of the powers exercised. Because it combines both granting authority and protecting procedural fairness, the best description is that it serves both functions. It isn’t simply an administrative tool on its own, nor is it something like a traffic-related instrument or a null function.

A Letter of Authority serves two purposes in tax investigations: it is a modality for delegating the CIR’s investigatory powers to the officers carrying out the inquiry, and it is a manifestation of due process, outlining the scope, authority, and procedural safeguards that ensure the investigation is legitimate and fair. In practice, this means the LOA authorizes specific officials to gather information, request documents, or compel response within defined limits, while also communicating the rights of the taxpayer and the boundaries of the powers exercised. Because it combines both granting authority and protecting procedural fairness, the best description is that it serves both functions. It isn’t simply an administrative tool on its own, nor is it something like a traffic-related instrument or a null function.