(a) A corporation, trust or association which is a real estate investment trust (hereinafter called “REIT”) as defined in subsection (a) of section 856 of the Internal Revenue Code and which meets the requirements of subsection (c) of such section will be treated as a REIT for purposes of article 9-A of the Tax Law. For any taxable year of a REIT in which the REIT is subject to tax for Federal income tax purposes under section 857 of the Internal Revenue Code and for purposes of article 9-A, the REIT is subject to tax computed on entire net income (see subdivision [b] of this section) or the minimum tax whichever is greater.

(b) In the case of a REIT, as described in subdivision (a) of this section, the term entire net income shall mean real estate investment trust taxable income as defined in Internal Revenue Code, section 857(b)(2) (as modified by section 858) plus any amount taxable under section 857(b)(3). The amount computed under the preceding sentence is subject to the adjustments required by sections 3-2.3 and 3-2.4 of this Part, but a deduction for 50 percent of dividends other than from subsidiaries is not allowed. The REIT's entire net income must be modified as required by section 4-8.6 of this Title relating to optional deductions for depreciation.

(c) For information relating to the inclusion of a REIT in a combined report, see section 211.4 of the Tax Law.

(d) In the event a REIT pays dividends after the close of a taxable year and such dividends were declared before the date its report for such year must be filed (including extensions), it may treat the dividends as having been paid during the taxable year.

(e) For any taxable year during which a REIT does not qualify for taxation under section 857 of the Internal Revenue Code, it will be treated in the same manner as any other taxpayer subject to tax under article 9-A of the Tax Law.

(f) For rules relating to corporate partners, see Subpart 3-13 of this Part—Corporate Partners.