(a) If the alternative entire net income required to be reported under article 32 of the Tax Law is for a period different than the period covered by the taxpayer's Federal income tax return, the taxpayer's alternative entire net income must be prorated to correspond with the period covered by the return under article 32 of the Tax Law. The prorated alternative entire net income is computed as follows: (1) divide alternative entire net income, as determined in section 18-4.1(b) of this Subpart, by the number of calendar months, or major parts thereof, covered by the return for Federal income tax purposes; and (2) multiply the result by the number of calendar months, or major parts thereof, covered by the return under article 32 of the Tax Law.

(b) The method of computing alternative entire net income for a short period, as set forth in this section, applies to taxpayers reporting on either a calendar year or fiscal year basis for Federal income tax purposes.

(c) If, in the opinion of the Tax Commission, the method described in this section does not properly reflect the taxpayer's alternative entire net income for purposes of article 32 of the Tax Law during the period covered by its return, the Tax Commission may determine entire net income solely on the basis of the taxpayer's income during such period.