(a) Under regulations prescribed by the board, if:
(1) A fee liability under this part was understated by a failure to file a return required to be filed under this part, by the omission of an amount properly includable therein, or by erroneous deductions or credits claimed on a return, and the understatement of the fee liability is
attributable to one spouse; or any amount of the fee reported on a return was unpaid and the nonpayment of the reported fee liability is attributable to one spouse.
(2) The other spouse establishes that he or she did not know of, and had no reason to know of, that understatement or nonpayment.
(3) Taking into account whether or not the other spouse significantly benefited directly or indirectly from the understatement or the nonpayment and taking into account all other facts and circumstances, it is inequitable to hold the other spouse liable for the deficiency in the fee attributable to that understatement or nonpayment,
then the other spouse shall be relieved of liability for the fee
(including interest, penalties, and other amounts) to the extent that the liability is attributable to that understatement or nonpayment of the fee.
(b) For purposes of this section, the determination of the spouse to whom items of understatement or nonpayment are attributable shall be made without regard to community property laws.
(c) This section shall apply to all calendar quarters subject to the provisions of this part, but shall not apply to any calendar quarter that is more than five years from the final date on the board-issued determination, five years from the return due date for nonpayment on a return, or one year from the first contact with the spouse making a claim under this section; or that has been closed by res judicata, whichever is later.
(d) For purposes of paragraph (2) of subdivision (a),
reason to know means whether or not a reasonably prudent person would have had reason to know of the understatement or nonpayment.
(e) For purposes of this section, with respect to a failure to file a return or an omission of an item from the return, attributable to one spouse may be determined by whether a spouse rendered substantial service as an owner of an underground storage tank containing petroleum that is subject to fees imposed by this part to which the understatement is attributable. If neither spouse rendered substantial services as an owner, then the attribution of applicable items of understatement shall be treated as community property. An erroneous deduction or credit shall be attributable to the spouse who caused that deduction or credit to be entered on the return.
(f) Under procedures prescribed by the board, if, taking into account all the facts and
circumstances, it is inequitable to hold the other spouse liable for any unpaid tax or any deficiency (or any portion of either) attributable to any item for which relief is not available under subdivision (a), the board may relieve the other spouse of that liability.
(g) For purposes of this section, registered domestic partners, as defined in Section 297 of the Family Code, have the same rights, protections, and benefits as provided by this section, and are subject to the same responsibilities, obligations, and duties as imposed by this section, as are granted to and imposed upon spouses.
(h) The relief provided by this section shall apply retroactively to liabilities arising prior to the effective date of this section.