Shea, J.
The sole issue in this case, which comes to us by way of reservation, is whether General Statutes § 12-217 authorizes the surviving corporation in a merger or consolidation to deduct from its income the operating loss carryover of the merged or consolidated corporation. The plaintiff, Golf Digest/Tennis, Inc., appealed to the Superior Court from a decision of the defendant commissioner of revenue services holding that the plaintiff had improperly claimed operating loss carryovers in the tax returns it had filed for the years 1980 and 1981. The trial court ordered a reservation upon stipulated facts to determine the propriety of the defendant’s assessment of additional corporation business taxes against the plaintiff. In responding to the first reserved question, which is the only question we [457]*457need address,1 we conclude that § 12-217 does not authorize the surviving corporation to deduct the operating loss carryovers of the merged or consolidated corporation for the tax years involved in this case.
The parties stipulated to the following facts. The plaintiff was formed on November 21,1979, under the laws of Delaware, as a corporation into which two Illinois corporations, Golf Digest, Inc., and Tennis Features, Inc., would be consolidated. Because Golf Digest and Tennis Features were each qualified to do business in Connecticut in 1979, both were subject to our corporation business tax. General Statutes §§ 12-213 through 12-242i. In that year Tennis Features recognized a net operating loss for the purpose of the federal tax law of $801,147, of which $540,858 was allocated to Connecticut. See General Statutes § 12-218. On December 31, 1979, Golf Digest and Tennis Features were consolidated into the plaintiff. In 1980 and 1981, Tennis Features, as a division of the plaintiff, continued to operate at a loss.
[458]*458Relying upon General Statutes § 12-217,2 which allows a net operating loss of a particular “income year” to be “deductible as an operating loss carry-over in each of the five income years following such loss year,” the plaintiff, in its tax returns for 1980 and 1981, claimed operating loss carryovers of $85,643 and $455,215, respectively, based on the 1979 operating loss of Tennis Features apportioned to Connecticut. After examining these returns, the defendant assessed additional taxes against the plaintiff of $7806.83 and $22,954.34 for 1980 and 1981, respectively, construing § 12-217 not to authorize the deduction by the plaintiff, the surviving corporation, of operating loss carryovers attributable to Tennis Features, the consolidated corporation.
[459]*459The plaintiff paid the disputed amount of $30,661.17, and then requested a hearing before the defendant commissioner. See General Statutes § 12-236. When the defendant affirmed his assessment and concomitantly denied the plaintiffs requests for correction, the plaintiff appealed to the Superior Court, pursuant to General Statutes § 12-237.3 In that court, the parties jointly [460]*460requested that the case be reserved to the Appellate Court for advice on the stated questions of law. See footnote 1, supra. The trial court granted this request, and, after transfer of the appeal to this court, the present proceedings ensued.
We note preliminarily that the parties have stipulated that, for federal tax purposes, the carryover of the 1979 operating loss of Tennis Features was available to the plaintiff for the years in question under § 381 of the Internal Revenue Code of 1954. The stipulation describes the consolidation into the plaintiff as a tax-free reorganization as defined in § 368 (a) (1) (A) of the code. Section 381 expressly provides, inter alia, that, in such a tax-free reorganization, a corporation that acquires the assets of another corporation shall succeed to and take into account the net operating loss carryovers of the distributor or transferor corporation. We further note that it is undisputed that § 12-217 of our General Statutes would authorize Tennis Features itself, had it retained its separate corporate identity, to deduct its 1979 operating loss as a carryover in each of the five subsequent years.
Unlike § 381 of the Internal Revenue Code of 1954, § 12-217 does not specifically address the question of the ability of a surviving corporation to deduct as a carryover the net operating losses attributable to a. consolidated corporation. Because our corporation business tax, including § 12-217, refers to federal tax law in several instances, the plaintiff argues that, in construing § 12-217, we ought to adhere to our established reliance upon federal tax principles. See Skaarup Shipping Corporation v. Commissioner, 199 Conn. 346, 351, [461]*461507 A.2d 988 (1986); The B. F. Goodrich Co. v. Dubno, 196 Conn. 1, 7, 490 A.2d 991 (1985); Woodruff v. Tax Commissioner, 185 Conn. 186, 191, 440 A.2d 854 (1981).
The plaintiff cites the decision by the Supreme Court of Ohio in Gulf Oil Corporation v. Lindley, 61 Ohio St. 2d 23, 398 N.E.2d 790 (1980), in support of its proposition that § 381 is the applicable federal rule impliedly incorporated in § 12-217. Interpreting a statute analogous to § 12-217; see Ohio Rev. Code Ann. § 5733.04; the Ohio court addressed the issue of whether a taxpayer succeeds to the net operating losses of its former subsidiaries that have merged into the taxpayer. A related Ohio statute provided that a taxpayer’s method of accounting must be the same as its method of accounting for federal income tax purposes. See Ohio Rev. Code Ann. § 5733.031 (B). The court in Gulf Oil Corporation v. Lindley, supra, 29, stated: “We are persuaded that Sections 381 (a) and (c) prescribe a method of accounting for a net operating loss following corporate acquisitions. These provisions do not create a new deduction; rather, corporations are entitled to deduct net operating loss carryovers under Section 172 of the Internal Revenue Code and [Ohio Rev. Code Ann. §] 5733.04 (I) (1). Section 381 merely fills a gap in Ohio law.”
We reject the notion that § 381 represents merely a method of accounting that must be used to fill a gap in the carryover provisions of § 12-217. Sections 446 through 472 of the Internal Revenue Code discuss methods of accounting, which include the cash receipts or disbursements, accrual, installment, and completed contract methods. Corporations are ordinarily authorized to use their regular accounting method, unless such method does not clearly reflect income. See B. Bittker & J. Eustice, Federal Income Taxation of Cor[462]*462porations and Shareholders (4th Ed. 1979) § 1.01, p. 1-4. While the accurate reporting of income is the raison d’etre of the federal provisions regarding accounting methods, § 381 was enacted to provide a comprehensive set of rules for the preservation of tax attributes.
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Shea, J.
The sole issue in this case, which comes to us by way of reservation, is whether General Statutes § 12-217 authorizes the surviving corporation in a merger or consolidation to deduct from its income the operating loss carryover of the merged or consolidated corporation. The plaintiff, Golf Digest/Tennis, Inc., appealed to the Superior Court from a decision of the defendant commissioner of revenue services holding that the plaintiff had improperly claimed operating loss carryovers in the tax returns it had filed for the years 1980 and 1981. The trial court ordered a reservation upon stipulated facts to determine the propriety of the defendant’s assessment of additional corporation business taxes against the plaintiff. In responding to the first reserved question, which is the only question we [457]*457need address,1 we conclude that § 12-217 does not authorize the surviving corporation to deduct the operating loss carryovers of the merged or consolidated corporation for the tax years involved in this case.
The parties stipulated to the following facts. The plaintiff was formed on November 21,1979, under the laws of Delaware, as a corporation into which two Illinois corporations, Golf Digest, Inc., and Tennis Features, Inc., would be consolidated. Because Golf Digest and Tennis Features were each qualified to do business in Connecticut in 1979, both were subject to our corporation business tax. General Statutes §§ 12-213 through 12-242i. In that year Tennis Features recognized a net operating loss for the purpose of the federal tax law of $801,147, of which $540,858 was allocated to Connecticut. See General Statutes § 12-218. On December 31, 1979, Golf Digest and Tennis Features were consolidated into the plaintiff. In 1980 and 1981, Tennis Features, as a division of the plaintiff, continued to operate at a loss.
[458]*458Relying upon General Statutes § 12-217,2 which allows a net operating loss of a particular “income year” to be “deductible as an operating loss carry-over in each of the five income years following such loss year,” the plaintiff, in its tax returns for 1980 and 1981, claimed operating loss carryovers of $85,643 and $455,215, respectively, based on the 1979 operating loss of Tennis Features apportioned to Connecticut. After examining these returns, the defendant assessed additional taxes against the plaintiff of $7806.83 and $22,954.34 for 1980 and 1981, respectively, construing § 12-217 not to authorize the deduction by the plaintiff, the surviving corporation, of operating loss carryovers attributable to Tennis Features, the consolidated corporation.
[459]*459The plaintiff paid the disputed amount of $30,661.17, and then requested a hearing before the defendant commissioner. See General Statutes § 12-236. When the defendant affirmed his assessment and concomitantly denied the plaintiffs requests for correction, the plaintiff appealed to the Superior Court, pursuant to General Statutes § 12-237.3 In that court, the parties jointly [460]*460requested that the case be reserved to the Appellate Court for advice on the stated questions of law. See footnote 1, supra. The trial court granted this request, and, after transfer of the appeal to this court, the present proceedings ensued.
We note preliminarily that the parties have stipulated that, for federal tax purposes, the carryover of the 1979 operating loss of Tennis Features was available to the plaintiff for the years in question under § 381 of the Internal Revenue Code of 1954. The stipulation describes the consolidation into the plaintiff as a tax-free reorganization as defined in § 368 (a) (1) (A) of the code. Section 381 expressly provides, inter alia, that, in such a tax-free reorganization, a corporation that acquires the assets of another corporation shall succeed to and take into account the net operating loss carryovers of the distributor or transferor corporation. We further note that it is undisputed that § 12-217 of our General Statutes would authorize Tennis Features itself, had it retained its separate corporate identity, to deduct its 1979 operating loss as a carryover in each of the five subsequent years.
Unlike § 381 of the Internal Revenue Code of 1954, § 12-217 does not specifically address the question of the ability of a surviving corporation to deduct as a carryover the net operating losses attributable to a. consolidated corporation. Because our corporation business tax, including § 12-217, refers to federal tax law in several instances, the plaintiff argues that, in construing § 12-217, we ought to adhere to our established reliance upon federal tax principles. See Skaarup Shipping Corporation v. Commissioner, 199 Conn. 346, 351, [461]*461507 A.2d 988 (1986); The B. F. Goodrich Co. v. Dubno, 196 Conn. 1, 7, 490 A.2d 991 (1985); Woodruff v. Tax Commissioner, 185 Conn. 186, 191, 440 A.2d 854 (1981).
The plaintiff cites the decision by the Supreme Court of Ohio in Gulf Oil Corporation v. Lindley, 61 Ohio St. 2d 23, 398 N.E.2d 790 (1980), in support of its proposition that § 381 is the applicable federal rule impliedly incorporated in § 12-217. Interpreting a statute analogous to § 12-217; see Ohio Rev. Code Ann. § 5733.04; the Ohio court addressed the issue of whether a taxpayer succeeds to the net operating losses of its former subsidiaries that have merged into the taxpayer. A related Ohio statute provided that a taxpayer’s method of accounting must be the same as its method of accounting for federal income tax purposes. See Ohio Rev. Code Ann. § 5733.031 (B). The court in Gulf Oil Corporation v. Lindley, supra, 29, stated: “We are persuaded that Sections 381 (a) and (c) prescribe a method of accounting for a net operating loss following corporate acquisitions. These provisions do not create a new deduction; rather, corporations are entitled to deduct net operating loss carryovers under Section 172 of the Internal Revenue Code and [Ohio Rev. Code Ann. §] 5733.04 (I) (1). Section 381 merely fills a gap in Ohio law.”
We reject the notion that § 381 represents merely a method of accounting that must be used to fill a gap in the carryover provisions of § 12-217. Sections 446 through 472 of the Internal Revenue Code discuss methods of accounting, which include the cash receipts or disbursements, accrual, installment, and completed contract methods. Corporations are ordinarily authorized to use their regular accounting method, unless such method does not clearly reflect income. See B. Bittker & J. Eustice, Federal Income Taxation of Cor[462]*462porations and Shareholders (4th Ed. 1979) § 1.01, p. 1-4. While the accurate reporting of income is the raison d’etre of the federal provisions regarding accounting methods, § 381 was enacted to provide a comprehensive set of rules for the preservation of tax attributes. “The drafters hoped to protect taxpayers against the loss of favorable tax attributes, as well as to prevent the avoidance of unfavorable ones by paper reorganizations.” B. Bittker & J. Eustice, supra, § 16.10, p. 16-16. Indeed, rather than itself representing a method of accounting, § 381 provides that the acquiring corporation in a corporate reorganization shall succeed to the method of accounting used by the distributor or transferor corporation. See I.R.C. § 381 (c) (4). Thus, despite the pronouncement of the Gulf Oil Corporation court, § 381 appears to be a substantive provision that creates legal rights apart from those set forth in the operating loss carryover provisions of § 172 of the Internal Revenue Code.
Relying upon federal tax principles in attempting to resolve the issue before us does not necessitate finding a wholesale incorporation into § 12-217 of the rules embodied in § 381 of the code. More instructive would be an examination of the federal resolution of that issue under the Internal Revenue Code of 1939, which, like our current corporation business tax, provided no express governing provision. In Libson Shops, Inc. v. Koehler, 353 U.S. 382, 386-87, 77 S. Ct. 990, 1 L. Ed. 2d 924, reh. denied, 354 U.S. 943, 77 S. Ct. 1390, 1 L. Ed. 2d 1542 (1957), the United States Supreme Court discerned no indication in the legislative history of the general carryover provisions as they existed under the 1939 code “that these provisions were designed to permit the averaging of the pre-merger losses of one business with the post-merger income of some other business which had been operated and taxed separately before the merger.” Concluding that the [463]*463income against which a carryover is claimed must have been produced “by substantially the same businesses which incurred the losses”; id., 390; the Libson court affirmed the denial of the claimed carryover deduction because the business units that had the pre-merger losses continued to have losses after the merger.
As we have stated, the parties stipulated to the fact that Tennis Features, as a division of the plaintiff, continued to operate at a loss in 1980 and 1981. The income against which the plaintiff claimed a carryover for those years was therefore not produced by substantially the same business unit that had suffered the preconsolidation losses. Thus, even if we were to construe § 12-217 as incorporating the principle set forth in Libson, the circumstances of the present case would preclude an application of that principle favorable to the plaintiff for the 1980 and 1981 tax years.4
[464]*464We next examine the history and language of § 12-217. The original predecessor of § 12-217, which was enacted as part of the Corporation Business Tax Act of 1935, c. 66b, § 419c, provided that, “[i]n arriving at net income as defined in section 417c, whether or not the taxpayer is taxable under the federal corporation net income tax, there shall be deducted from gross income, (A) all items deductible under the federal corporation net income tax law effective and in force on the last day of the income year except (1) federal taxes on income or profits, losses of prior years . . . . ” See generally W. T. Grant Co. v. McLaughlin, 129 Conn. 663, 664, 30 A.2d 921 (1943). Section 12-217 retains the exclusion from deductible items of losses of prior years, notwithstanding any availability of such a deduction under federal tax law. See 26 U.S.C. § 172. Our General Assembly, however, in 1973, amended § 12-217 to include a provision allowing the operating loss carryover deduction. That provision reads in part: “Notwithstanding anything in this section to the contrary, (1) any excess of the deductions provided in this section for any income year commencing on or after January 1,1973, over the gross income for such year or the amount of such excess apportioned to this state under the provisions of section 12-218, shall be an operating loss of such income year and shall be deductible as an operating loss carry-over in each of the five income years following such loss year . . . . ”
Section 12-217 provides both that “no deduction shall be allowed for . . . losses of other calendar or fiscal years,” and, nevertheless, that the operating loss of a particular income year shall be deductible as an operating loss carryover in each of the five subsequent income years. “[W]e have uniformly adhered to the view that deductions from otherwise taxable income are a matter of legislative grace and hence are strictly construed against the taxpayer.” Skaarup Shipping [465]*465Corporation v. Commissioner, supra, 352; see Harper v. Tax Commissioner, 199 Conn. 133, 142, 506 A.2d 93 (1986); The B. F. Goodrich Co. v. Dubno, supra, 8-9. In order to prevail in light of this rule of construction, the plaintiff must establish that § 12-217 clearly and unambiguously authorizes a surviving corporation to claim a deduction for the operating losses that had been incurred by an acquired corporation prior to the consolidation. This the plaintiff cannot do, and therefore it is unable to claim the deduction. Accord Fall River Canning Co. v. Department of Taxation, 3 Wis. 2d 632, 637-38, 89 N.W.2d 203 (1958). As we have stated, “[although corporations would be further benefited by greater availability of loss carryover deductions, that is a consideration for the legislature, not for the courts.”5 The B. F. Goodrich Co. v. Dubno, supra, 9.
The first question that was reserved to this court stated the issue as follows: “For purposes of the Connecticut Corporation Business Tax, is the surviving corporation in a merger or consolidation entitled to the same treatment under General Statutes § 12-217 with respect to operating loss carryovers of the merged or consolidated corporation as would be accorded to such surviving corporation under the federal corporation net income tax law with respect to the net operating loss [466]*466carryovers of the merged or consolidated corporation?” For the reasons stated above, our answer to this reserved question is “no.”
No costs will be taxed in this court to either party.
In this opinion the other justices concurred.