A. Every remitter or pass-through entity is liable for:

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(1)     amounts required to be deducted and withheld by the Oil and Gas Proceeds and Pass-Through Entity Withholding Tax Act regardless of whether the amounts were in fact deducted and withheld; and

(2)     for the amounts that a remittee or an owner has agreed to remit pursuant to Subsection G of Section 7-3A-3 N.M. Stat. Ann., once the department has notified the remitter or pass-through entity that the remittee or owner has failed to remit.

B. A remitter or pass-through entity is not liable for amounts required to be deducted and withheld by the Oil and Gas Proceeds and Pass-Through Entity Withholding Tax Act but not deducted or withheld if:

(1)     the remitter or pass-through entity fails to deduct and withhold the required amounts and if the tax against which the required amounts would have been credited is paid; or

(2)     the remitter’s or pass-through entity’s failure to deduct and withhold the required amounts is due to reasonable cause.