Dollars & Sense

AAA says gas prices not following norm

January is supposed to be one of the cheaper times of year to fill up on gasoline, but AAA of Northern California said its gas price survey didn't follow that trend in 2008. The average price of a gallon of regular gas in Northern California is up 2 cents from last month, to $3.35. Modesto, at $3.30 a gallon, is unchanged from last month. AAA officials attribute the higher price to ongoing spikes in the price of a barrel of oil, which hit $100 last week and still is in the high $90s. Those officials also note that Northern California drivers are paying an average of 69 cents more for gas this month than they were a year ago. Nationally, the average of $3.11 a gallon is 11 cents below the record high price. In Stockton, drivers are paying $3.32 a gallon, up 2 cents from December. Fresno drivers pay $3.35, down 1 cent from last month.

Tax tweaks untimely

End-of-year congressional votes to change the tax code have created havoc for the Internal Revenue Service and top the list of problems bedeviling taxpayers, according to an annual report released Wednesday. The National Taxpayer Advocate also accused the IRS of not doing enough to help the insolvent -- including those losing their homes -- avoid paying taxes on canceled debts and not providing fee waivers to low-income taxpayers. Taxpayer Advocate Nina E. Olson urged Congress to enact a Taxpayer Bill of Rights and to authorize symbolic apology payments to those seriously affected by IRS errors. The National Taxpayer Advocate, who works independently within the IRS, is required by Congress to report annually on at least

20 of the most serious problems facing taxpayers. This year, the main culprit was Congress, which for the second-straight year passed legislation in December that significantly changed the tax code. The problem? The legislation was enacted after the IRS normally goes to print with forms for the coming tax season.

Recession fears rise

The nation's major retailers are slated to report tepid sales gains for December today, likely making the holiday shopping season the weakest since 2002. The size of the pullback in consumer spending could inflame recession fears that have grown during a recent batch of negative economic reports. Consumers, faced with higher gas and food prices, a slumping housing market and an escalating credit crisis, have been cutting back on spending over the past year. But recent news of $100-a-barrel oil, a weakening job market and a mortgage sector in distress are making economists more worried about consumers' financial health.