Where Did the Money Go That Increased the Deficit?

Deficit Tracker

BPC's economic policy team analyzes the government's running budget deficit and updates the Deficit Tracker everymonth.

Large and sustained federal budget deficits are harmful to the fiscal health of the United States. Yet policymakers struggle with reining in the red ink. Even in times of economic growth, the federal government ran large and growing budget deficits, near$1 trillion per year. Before the COVID-19 pandemic, it was an ominous trend. Now that policymakers are enacting necessary, emergency measures to combat the crisis, federal budget deficits are escalating to levels not seen since World War II. BPC's economic policy team analyzes the government's running budget deficit and updates the Deficit Tracker every month.

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Deficit Tracker

2018 Deficit 2019 Deficit 2020 Deficit 2021 Deficit 2022 Deficit
October 63 100 134 284 165
November 202 305 343 429 358
December 225 319 357 573 --
January 176 310 389 735 --
February 391 544 624 1047 --
March 600 691 744 1706 --
April 385 531 1482 1931 --
May 532 739 1880 2063 --
June 607 747 2744 2238 --
July 684 867 2807 2540 --
August 898 1067 3002 2710 --
September 779 984 3131 2769 --

NOTE: GRAPH SHOWS CUMULATIVE DEFICITS OVER THE FISCAL YEAR, WHICH BEGINS IN OCTOBER.
Source: U.S. Department of the Treasury, Congressional Budget Office.

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Tracking the Federal Deficit: November 2021

The Congressional Budget Office estimates that the federal government ran a deficit of $193 billion in November, the second month of fiscal year 2022. This deficit was the difference between $474 billion of spending and $281 billion of revenue. November's deficit was 33% ($48 billion) larger than the deficit recorded in November 2020. However, spending last November was artificially lowered by the fact that November 1 fell on a weekend, shifting $63 billion worth of payments into late October. If not for the timing shift, this November's deficit would have been 7% ($15 billion) less than that of November last year.

Analysis of notable trends: Through the first two months of FY2022, the federal government has run a deficit of $358 billion—$71 billion less than at this point last year—as spending rose 4% and revenues surged 24% this year, reflective of the nation's ongoing economic recovery.

Certain key pandemic response efforts that fueled last year's deficits have wound down: For example, in October and November alone, outlays for unemployment compensation decreased by $43 billion (82%) year-over-year, driven by the expiration of enhanced benefits as well as lower levels of unemployment. Other new COVID-19 relief programs, however, contributed to the overall year-over-year increase in outlays. Expenditures for certain refundable tax credits, such as the Advance Child Tax Credit payments that were expanded in pandemic-response legislation and rolled out in July 2021, rose by $38 billion (325%) relative to this time last year. Pandemic relief programs also drove spending increases for the Public Health Social Services Emergency Fund, the Department of Education, and the Department of Agriculture's Food and Nutrition Service by 160%, 77%, and 58%, respectively, during the first two months of the fiscal year.

Individual income and payroll tax receipts together rose by $96 billion (24%) compared to October and November 2020, fueled by higher total wages and salaries. Early COVID-19 relief legislation, however, allowed employers to defer certain payroll tax payments, shifting into this year some payroll tax receipts that would have otherwise been collected last year. Continuing a trend of recent months, unemployment insurance receipts rose by $8 billion as states replenish their unemployment insurance trust funds. Looking ahead, most companies owe their first quarterly estimated income tax payments for 2022 on December 15, 2021, which should provide further insight into the pace of the country's recovery.

Tracking the Federal Deficit: October 2021

The Congressional Budget Office estimates that the federal government ran a deficit of $167 billion in October, the first month of fiscal year 2022. This deficit is the difference between an estimated $285 billion in revenues and $451 billion in outlays.

October's deficit is 41% ($117 billion) less than the $284 billion deficit recorded in October 2020, the first month of FY 2021. A 20% year-over-year upswing in revenues due to higher individual income and payroll taxes, complemented by a reduction in outlays (13% lower) from waning COVID-19 relief spending this year, drove the year-over-year deficit decline.

  • FY2022

    Tracking the Federal Deficit: November 2021

    The Congressional Budget Office estimates that the federal government ran a deficit of $193 billion in November, the second month of fiscal year 2022. This deficit was the difference between $474 billion of spending and $281 billion of revenue. November's deficit was 33% ($48 billion) larger than the deficit recorded in November 2020. However, spending last November was artificially lowered by the fact that November 1 fell on a weekend, shifting $63 billion worth of payments into late October. If not for the timing shift, this November's deficit would have been 7% ($15 billion) less than that of November last year.

    Analysis of notable trends: Through the first two months of FY2022, the federal government has run a deficit of $358 billion—$71 billion less than at this point last year—as spending rose 4% and revenues surged 24% this year, reflective of the nation's ongoing economic recovery.

    Certain key pandemic response efforts that fueled last year's deficits have wound down: For example, in October and November alone, outlays for unemployment compensation decreased by $43 billion (82%) year-over-year, driven by the expiration of enhanced benefits as well as lower levels of unemployment. Other new COVID-19 relief programs, however, contributed to the overall year-over-year increase in outlays. Expenditures for certain refundable tax credits, such as the Advance Child Tax Credit payments that were expanded in pandemic-response legislation and rolled out in July 2021, rose by $38 billion (325%) relative to this time last year. Pandemic relief programs also drove spending increases for the Public Health Social Services Emergency Fund, the Department of Education, and the Department of Agriculture's Food and Nutrition Service by 160%, 77%, and 58%, respectively, during the first two months of the fiscal year.

    Individual income and payroll tax receipts together rose by $96 billion (24%) compared to October and November 2020, fueled by higher total wages and salaries. Early COVID-19 relief legislation, however, allowed employers to defer certain payroll tax payments, shifting into this year some payroll tax receipts that would have otherwise been collected last year. Continuing a trend of recent months, unemployment insurance receipts rose by $8 billion as states replenish their unemployment insurance trust funds. Looking ahead, most companies owe their first quarterly estimated income tax payments for 2022 on December 15, 2021, which should provide further insight into the pace of the country's recovery.

    Tracking the Federal Deficit: October 2021

    The Congressional Budget Office estimates that the federal government ran a deficit of $167 billion in October, the first month of fiscal year 2022. This deficit is the difference between an estimated $285 billion in revenues and $451 billion in outlays.

    October's deficit is 41% ($117 billion) less than the $284 billion deficit recorded in October 2020, the first month of FY 2021. A 20% year-over-year upswing in revenues due to higher individual income and payroll taxes, complemented by a reduction in outlays (13% lower) from waning COVID-19 relief spending this year, drove the year-over-year deficit decline.

  • FY2021

    Fiscal Year 2021 in Review

    The federal government ran a deficit of $2.8 trillion in fiscal year 2021, the difference between $4.0 trillion in revenues and $6.8 trillion in spending. This deficit was 12% lower ($362 billion less) than in fiscal year 2020, due to revenue increases outpacing expenditure growth. The FY2021 deficit, however, was almost three times that of FY2019 ($1.8 trillion greater), as federal COVID-19 relief spending has continued to drive outlays to record highs. This year's deficit amounted to approximately 13% of GDP, the second largest deficit as a share of the economy since 1945. Revenues tallied 18% of GDP, while spending rose to 30% of GDP.

    Receipts totaled $4.0 trillion in FY2021—an 18% ($627 billion) year-over-year increase—reflecting the general strength of the economy during the initial stages of the pandemic recovery. Individual income and payroll tax revenues together rose 15%, due to a combination of higher wages, increased employment, and payroll taxes that had been deferred by most employers from 2020 to 2021 per the CARES Act of March 2020. Corporate tax revenues increased by 75% in part due to higher corporate profits, and unemployment insurance receipts increased by 31% as states replenished their unemployment insurance trust funds.

    Meanwhile, outlays in FY2021 rose by 4% ($265 billion) from FY2020, largely driven by the continued federal response to the pandemic, where many relief programs were in place for more months during this past year than in FY2020. In contrast, spending by the Small Business Administration and for unemployment compensation—each of which ballooned during FY2020—decreased by 44% and 17% respectively from last year. Spending on these programs, however, remained hundreds of billions of dollars higher than in FY2019. Additionally, compared to FY2020, spending in FY2021 increased by:

    • $363 billion in refundable tax credits, including economic impact payments and advanced Child Tax Credit payments
    • $94 billion in COVID-19 relief for state and local governments
    • $63 billion for Medicaid, largely due to pandemic relief
    • $57 billion for the Department of Education, primarily for emergency COVID-19 relief to support K-12 and post-secondary education
    • $50 billion for the Department of Agriculture, primarily for SNAP benefits and pandemic assistance to farmers
    • $39 billion in Social Security benefits, due to increases in both the number of beneficiaries and the average benefit payment
    • $33 billion in grants to state and local governments to support low-income households with emergency rental assistance
    • $25 billion in net interest on the public debt

    As winter approaches, the trajectory of the pandemic and its impact on the deficit remain intertwined yet deeply uncertain. Will new variants pump the breaks on the country's economic recovery, decreasing revenues? Will vaccine mandates and eligibility for younger children decrease caseloads and give Americans confidence to shop and travel, promoting consumer spending? If, like last year, the pandemic takes a turn for the worse during the cooler months, will the federal government decide that the economy needs another jolt of stimulus? The answers to these questions and others will shape the federal government's financial standing for fiscal year 2022.

    Tracking the Federal Deficit: September 2021

    The federal deficit for September 2021 was $59 billion, approximately $65 billion (52%) less than the deficit for September 2020. This deficit was the difference between revenues of $460 billion and spending of $519 billion. Although individual and corporate tax payments in September typically produce a large surplus, COVID-19 relief spending eclipsed them and led to a September deficit for the second year in a row.

    Revenues increased by $87 billion (23%) in relation to the same month last year. The increase was mostly caused by a 23% rise in income and payroll taxes and a 71% increase in corporate income tax receipts.

    Spending rose $22 billion (4%) year-over-year. Notably, spending by the Department of Education was 107% higher than in September 2020. An upward revision of $95 billion to the department's estimated net subsidy costs of loans and loan guarantees was driven partially by pandemic-related causes—including the extension of pauses on the payment of loan principal and interest and the collection of loans in default—and partially by re-estimates of how much the federal government would be repaid on its outstanding portfolio. Spending on refundable tax credits increased $21 billion year-over-year primarily due to the monthly advanced Child Tax Credit payments authorized by the American Rescue Plan earlier this year.

    Decreased outlays on other pandemic-response efforts in September offset some of this spending growth. Department of Homeland Security outlays shrank 74% year-over-year, as certain payments such as unemployment benefits that disbursed through the Disaster Relief Fund in September 2020 were not repeated in 2021. Unemployment compensation from the Department of Labor was also 57% lower this September compared to last, as expanded unemployment benefits expired early in the month.

    Tracking the Federal Deficit: August 2021

    The Congressional Budget Office estimates that the federal government ran a deficit of $173 billion in August, the eleventh month of fiscal year 2021. Because August 1 fell on a weekend this year, certain large federal payments that typically pay out on the first of the month were shifted into late July. If not for this timing shift, the August deficit would have been $233 billion—$60 billion greater than reported. Monthly revenues rose 20% ($45 billion) compared to last August, primarily due to increased income and payroll tax receipts. Spending increased by 4% ($17 billion) year over year, driven by changes in pandemic response spending.

    So far this fiscal year, the federal government has run a cumulative deficit of $2.7 trillion, the difference between $3.6 trillion in revenue and $6.3 trillion in spending. This deficit is 10% lower ($295 billion less) than over the same period in FY2020, but more than 150% larger than the FY2019 deficit ($1.6 trillion greater) at this point in the year.

    Analysis of Notable Trends: With one month to go until the close of fiscal year 2021, the federal government is on track to record a somewhat smaller deficit than last year. The economic recovery has buoyed revenues, and the tapering of some large pandemic relief programs has slowed growth in outlays.

    Revenues in 2021 have increased 18% ($539 billion) year-to-date compared to 2020. Corporate tax revenues alone are up 77% ($125 billion) year-over-year. After declining from 2019 to 2020, individual income tax receipts have bounced back this year, rising 26% ($382 billion) over the same 11-month period in 2020.

    Cumulative year-to-date outlays increased 4% ($245 billion) compared to the first 11 months of FY2020, with high expenditure levels driven by COVID-19 relief programs. While federal spending in response to the pandemic has occurred throughout the entirety of FY2021—compared to approximately only three quarters of FY2020—some of it has decreased year-over-year. Small Business Administration outlays are 44% ($256 billion) less than over the same period last year, reflecting the gradual reduction of spending towards pandemic assistance programs like the Paycheck Protection Program and Economic Injury Disaster Loan program. As the economy added back jobs that were lost in 2020 and some states ended enhanced unemployment benefits early, spending on unemployment compensation was down 14% ($61 billion) compared to last year.

    Total outlays through August, however, were 52% ($2.1 trillion) greater than they were over the same period in FY2019. Certain pandemic response efforts have contributed to high spending levels in recent months, including advanced Child Tax Credit payments, Coronavirus Relief Fund payments to state and local governments, and emergency rental relief.

    Tracking the Federal Deficit: July 2021

    The Congressional Budget Office estimates that the federal government ran a deficit of $301 billion in July, the tenth month of fiscal year 2021. Because August 1 fell on a weekend in both 2020 and 2021, certain federal programs that typically pay out large sums on the first of the month did so twice in July. If not for these timing shifts, the deficit would have been $60 billion less last month. July's deficit was the difference between $261 billion in revenue and $562 billion in spending. Monthly receipts dropped 54% ($302 billion) compared to last July due to 2021's return to the regular April and June tax filing deadlines for individual and corporate tax payments. (Those deadlines had been delayed until July in 2020.)

    So far this fiscal year, the federal government has run a cumulative deficit of $2.5 trillion, the difference between $3.3 trillion in revenue and $5.9 trillion in spending. This deficit is 10% lower ($269 billion less) than over the same period in FY2020, but nearly triple the FY2019 deficit ($1.7 trillion greater).

    Analysis of Notable Trends: Fiscal patterns over the past month continue to reflect the federal government's response to the COVID-19 pandemic, as well as the developing economic recovery.

    Growth in federal revenues remains robust, increasing 17% ($494 billion) compared to the same 10-month period in FY2020. This increase is indicative of a strengthening economy, with a steady inflow of individual income and payroll taxes from higher total wages and salaries, and corporate taxes from larger corporate profits, the latter of which increased 76% ($121 billion) year-over-year.

    Cumulative year-to-date outlays increased 4% ($225 billion) compared to the first 10 months of FY2020, again driven by pandemic-relief programs. These include a $318 billion increase (79%) in spending for economic impact payments and refundable tax credits, which were expanded this fiscal year under the American Rescue Plan Act of 2021. Additionally, outlays from the Coronavirus Relief Fund increased $62 billion (42%) year-over-year. On the flipside, Medicare outlays declined 12% ($76 billion) compared to the same period in FY2020, as the expansions carried out under the Coronavirus Aid, Relief, and Economic Security Act of 2020 increased outlays last July and have since dissipated. Total outlays this year are still 57% ($2.1 billion) greater than the same period in FY2019, demonstrating the lasting effect of COVID-19 relief programs on the federal budget.

    Finally, it is noteworthy that as a result of rising inflation and growing debt, the federal government paid $10 billion more in interest on the public debt last month than it did in July 2020.

    Tracking the Federal Deficit: June 2021

    The Congressional Budget Office estimates that the federal government ran a deficit of $173 billion in June, the ninth month of fiscal year 2021. June's deficit was the difference between $450 billion in revenue and $623 billion in spending.

    So far this fiscal year, the federal government has run a cumulative deficit of $2.2 trillion, the difference between $3.1 trillion in revenue and $5.3 trillion in spending. This deficit is nearly triple the shortfall over the same period in FY2019 ($1.5 trillion greater), but is 19% ($508 billion) lower than at the same point in FY2020. This is the first time in FY2021 that the cumulative deficit has decreased year-over-year.

    Analysis of Notable Trends: Thus far in FY2021, year-over-year comparisons of deficit levels have largely reflected the trajectory of the COVID-19 pandemic and subsequent federal response. BPC expects this trend to continue through the rest of the fiscal year.

    The driving force behind the year-over-year decrease in the cumulative deficit through June was a substantial increase in revenues. Total receipts over the first nine months of this year increased 35% ($797 billion) compared to FY2020—digging a bit deeper, this was comprised of a 30% increase ($589 billion) in individual income and payroll tax revenues, and a 192% ($176 billion) increase in corporate income tax revenues. These changes, however, are largely attributable to earlier due dates of tax payments, which were delayed until July in FY2020. Fiscal year revenues to date were also up 17% compared to FY2019 ($448 billion), partly a result of increased workers' wages and salaries, particularly among higher-income individuals who pay the majority of federal income taxes.

    Total spending in June was $623 billion, a $482 billion drop compared to June 2020. Much of this difference can be attributed to a $480 billion decrease in federal outlays from the Small Business Administration, whose significant COVID-19 relief obligations—such as the Paycheck Protection Program—accounted for almost half of government spending in June 2020 following the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Additionally, unemployment compensation outlays decreased $76 billion year-over-year, largely because: 1) weekly unemployment insurance benefits included a $600 federal supplement in June 2020 but only a $300 federal supplement in June 2021; and 2) fewer people are now collecting benefits due to lower unemployment and more stringent eligibility rules in some states.

    Cumulative year-to-date outlays are up 6% ($289 billion) compared to the first nine months of FY2020 and are 58% ($1.9 trillion) greater than at this point in FY2019. These changes are indicative of continued spending towards COVID-19 relief programs—in particular, refundable tax credits and supplemental unemployment compensation—as every month to date in the current fiscal year has contained pandemic-related expenditures, whereas only March-June did for the relevant period last year.

    Tracking the Federal Deficit: May 2021

    The Congressional Budget Office estimates that the federal government ran a deficit of $132 billion in May, the eighth month of fiscal year 2021. May's deficit was the difference between $463 billion of revenue and $596 billion of spending. To note, May spending was impacted by May 1 falling on a weekend, shifting certain payments into April that are normally paid at the beginning of May. If not for these timing shifts, the May deficit would have been $192 billion.

    So far this fiscal year, the federal government has run a cumulative deficit of $2.1 trillion, the difference between $2.6 trillion of revenue and $4.7 trillion of spending. This deficit is 10% ($184 billion) greater than at the same point in FY2020—when only three months of pandemic-related spending had occurred—and 179% ($1.3 trillion) greater than at this point in FY2019.

    Analysis of notable trends: The pandemic response continues to disrupt normal spending and revenue patterns. Individual income taxes are usually paid in April; however, in both 2020 and 2021, the federal government pushed back Tax Day due to COVID-19. This year, individual income taxes were due on May 17, compared to July 15 in 2020. Additionally, this year, estimated quarterly tax payments were due in April, whereas they were due in July in 2020. These shifting dates must be taken into account when considering year-over-year deficit comparisons.

    Partly as a result of the earlier deadline for individual tax payment, cumulative year-to-date revenues are up significantly: 29% ($587 billion) greater than at this point during the last fiscal year. Additionally, FY2021 year-to-date revenues are 15% greater than comparable FY2019 receipts. Given that the 2019 individual tax deadline was in April, as usual, the shifted 2021 deadline cannot account for this increase. Rather, the rise stems in part from higher wages and salaries, particularly among high-income workers who contribute the largest share of income tax revenue. Corporate income tax collections are also up from FY2019, and unemployment insurance receipts are rising as states replenish their trust funds.

    Federal spending remains stratospheric, primarily as a result of COVID-19 relief programs. Cumulative outlays are 20% ($771 billion) greater than at this point last fiscal year and 55% ($1.7 trillion) greater than at this point in FY2019. Every month to date in the current fiscal year has contained pandemic-related expenditures, whereas only March, April, and May did for the relevant period last year. As FY2021 progresses, and more of the comparable period of FY2020 contains pandemic relief, the cumulative year-over-year increase in spending will likely appear less stark. Recovery rebates, Small Business Administration relief programs (most notably the Paycheck Protection Program), and enhanced unemployment insurance benefits were the largest sources of increased spending in FY2021.

    Tracking the Federal Deficit: April 2021

    The Congressional Budget Office (CBO) estimates that the federal government ran a deficit of $225 billion in April, the seventh month of fiscal year 2021. April's deficit was the difference between $439 billion of revenue and $663 billion of spending. If not for a shift in the timing of some payments because May 1 fell on a weekend, April's deficit would have been $165 billion. (For the rest of this entry, all figures have been adjusted to reflect this timing shift.)

    So far this fiscal year, the federal government has run a cumulative deficit of $1.9 trillion, the difference between $2.1 trillion of revenue and $4.0 trillion of spending. This deficit is 26% ($389 billion) greater than at the same point last fiscal year and 252% ($1.3 trillion) greater than at this point in fiscal year 2019.

    Analysis of notable trends: In normal years, spending and revenues typically follow similar monthly patterns—an influx of individual income taxes arrives in April, corporate income taxes are paid quarterly, refundable tax credits are largely paid in February and March. These patterns allow analysts to gauge changes in federal finances by comparing each month's spending and revenues to the same month in the prior year.

    But 2020 was not a normal year (and neither is 2021). The federal response to COVID-19 created unprecedented, and often temporary, changes to spending and revenues. As a result, year-over-year comparisons now are largely capturing variations in emergency responses to COVID-19 rather than underlying trends in the government's fiscal health. For instance, this April's deficit was large—but 78% smaller than last April's, when provisions in the Coronavirus Aid, Relief, and Economist Security (CARES) Act created what was then the largest monthly deficit on record. Comparisons to earlier Aprils are also tricky, since individual income tax payments due on April 15 typically cause the federal government to run a surplus in April. This year, however, the deadline for final payment of income taxes has been pushed back to May 17, making April 2021 fiscally unique. Year-over-year comparisons of monthly spending, which was 61% greater than in April 2019 (although 38% lower than the extraordinary amount in April 2020), are somewhat more informative but still largely reflect the trajectory of COVID-19 expenditures.

    Cumulative year-to-date revenues are up substantially: 16% greater than at this point during the last fiscal year (although later filing deadlines in fiscal year 2020 inflate this difference) and 5% greater than in fiscal year 2019—even though the deadline for paying individual income taxes fell in April 2019 but has not yet arrived in 2021. Greater revenues this fiscal year are partly the result of growing wages and salaries—especially for higher-income workers who pay most income taxes—and, to a lesser extent, due to elevated unemployment insurance payroll taxes as states replenish their trust funds.

    Even though revenues have stepped up, spending has leapt further ahead: Cumulative outlays are 21% ($687 billion) greater than at this point last fiscal year and 56% ($1.4 trillion) greater than at this point in fiscal year 2019. The growth in spending from last fiscal year is driven by the federal government's response to the COVID-19 pandemic and recession. Every month to date in the current fiscal year has contained pandemic-related expenditures, whereas only March and April did for the relevant period last year.

    Tracking the Federal Deficit: March 2021

    The Congressional Budget Office (CBO) estimates that the federal government ran a deficit of $658 billion in March 2021, the sixth month of fiscal year 2021. This month's deficit—the difference between $267 billion in revenue and $925 billion in spending—was $487 billion greater than last March's (adjusted for shifts in the timing of certain payments). The federal deficit has now swelled to $1.7 trillion in fiscal year 2021, 129% higher than at this point last year. While revenues have grown 6% year-over-year, cumulative spending has surged 45% above last year's pace—largely a result of the COVID-19 pandemic, its economic fallout, and the federal government's fiscal response.

    Analysis of Notable Trends: Adjusted for timing shifts, outlays in March 2021 were $517 billion greater than last March, an increase of 127%. Unemployment insurance, refundable tax credits, and the Small Business Administration's Paycheck Protection Program accounted for most of the increase—both from March to March and from last fiscal year to this one. Spending on refundable tax credits was $346 billion higher in March 2021 than March 2020, mostly due to the payment of pandemic recovery rebates authorized by the Consolidated Appropriations Act and American Rescue Plan Act..

    Revenues totaled $1.7 trillion in the first six months of fiscal year 2021. Despite the continued recession—which had only just begun to show up in budget data at this point last year—cumulative revenues have risen by $100 billion, or 6%, from the same period last year. Individual income and payroll taxes together rose $78 billion and corporate income taxes increased, on net, by $20 billion. March 2020 saw the first effects of COVID-19 on economic activity, although they were slight. Compared to that month, receipts in March 2021 were $30 billion higher, an increase of 13%. The largest revenue boosts were greater withheld (up 12%) and non-withheld individual income and payroll taxes (up 35%).

    Tracking the Federal Deficit: February 2021

    The Congressional Budget Office estimates that the federal government ran a deficit of $312 billion in February 2021, the fifth month of fiscal year 2021. This month's deficit—the difference between $246 billion in revenue and $558 billion in spending—was $77 billion more than last February's. The deficit so far in fiscal year 2021 has climbed to just over $1 trillion, an 83% year-over-year increase (adjusted for shifts in the timing of certain payments). Year-over-year, total spending has risen by 25% and revenues have increased by 5%.

    Analysis of Notable Trends: Increased spending in February, and fiscal year 2021 as a whole, mostly resulted from pandemic relief legislation. For instance, the Small Business Administration's (SBA) Paycheck Protection Program accounted for most of the $133 billion spending increase from last February to this one. SBA outlays soared to $91 billion this February compared to only $100 million in the same month last year. The other largest spending changes were greater outlays on unemployment compensation ($44 billion, up from $3 billion in February 2020) and $17 billion less in refundable tax credit payments because of a delayed start to the tax filing season this year.

    Despite a historic recession, revenues were 5% higher in the first five months of fiscal year 2021 than during the same period last year (before the onset of COVID-19). This healthy growth is surprising, especially when compared to the onset of the last major recession: In the first five months of fiscal year 2009, revenues plunged 11% year-over-year.

    This fiscal year's revenues have held up in part because the pandemic recession has been so unequal. Lost jobs have overwhelmingly paid low wages, so total income—and the federal government's revenue base—has fallen by much less than total employment. Other factors holding up revenues are more transitory. The tax filing season is delayed and COVID-19 has slowed down the IRS's refund processing, meaning that many refunds comparable to those issued last February have not yet been issued in 2021, temporarily causing net revenues to look higher. Meanwhile, the American Rescue Plan will exempt some unemployment benefits from taxation, so a significant share of taxes already collected on these benefits will be refunded. Despite these transitory boosts to net revenue, the growth of federal revenue in the midst of such a deep contraction is impressive.

    Tracking the Federal Deficit: January 2021

    The Congressional Budget Office estimates that the federal government ran a deficit of $165 billion in January, the fourth month of fiscal year 2021. This month's deficit—the difference between $552 billion of spending and $387 billion of revenue—was $132 billion greater than last January's. But federal finances deteriorated more than the raw numbers suggest. Adjusting for shifts in the timing of some payments, the deficit this January would have been $211 billion greater than last January's. The federal deficit has now reached $738 billion so far this fiscal year, an increase of 120% over the same point last year (adjusted for timing shifts). Compared to the same point last fiscal year, cumulative revenues have ticked up 1%, but cumulative spending has surged 27%—mostly due to the COVID-19 pandemic and the federal response to it.

    Analysis of Notable Trends: After months in which COVID relief had all but run dry, Congress passed another round of aid just before the new year with the Consolidated Appropriations Act, 2021 (CAA). January was the first month in which this bill created significant new spending—largely in programs that have become the familiar drivers of outlays during the pandemic and recession. Spending on refundable tax credits, which include recovery rebates, rose $142 billion from last January. Continuing the trend since April 2020, outlays for unemployment compensation soared from January 2020 to 2021, rising from $3 billion to $34 billion. Emergency rental housing assistance ($25 billion), outlays for the Public Health and Social Services Emergency Fund (up $9 billion), and increased Medicare spending (up $7 billion, or 19%, from last January) further added to the monthly deficit.

    Increased spending so far this fiscal year has likewise mostly resulted from pandemic relief. About 60% of the increase in cumulative year-to-date spending has come from refundable tax credits (up $126 billion from this point last year) and unemployment insurance benefits (up $140 billion). Outlays from the Public Health and Social Services Emergency Fund are also up $26 billion compared to the first four months of fiscal year 2020, and Medicaid spending is $29 billion greater.

    Revenues rose 4% from last January, thanks to greater revenue from individual income, payroll, and corporate income tax revenue.

    So far this fiscal year, revenues are up 1%. This small net increase is the result of greater revenues from non-withheld individual taxes (up 21%), corporate income taxes (up 12), and unemployment insurance revenue (up 34%). Those increases overcame revenue losses inflicted by the pandemic. Lower earnings caused a 3% fall in the amount withheld from workers' paychecks; less consumer spending and the suspension of some aviation taxes through the end of calendar year 2020 caused revenue from excise taxes to drop by 25%; and a fall in imports led to a 13% dip in customs duties.

    Tracking the Federal Deficit: December 2020

    The Congressional Budget Office estimates that the federal government ran a deficit of $143 billion in December, the third month of fiscal year 2021. This deficit—the difference between $346 billion of revenue and $489 billion of spending—was made greater because January 3 fell on a Sunday, causing some payments normally made on that day to instead be made in December. If it were not for this timing shift, December's deficit would have been $96 billion, still $55 billion greater than that of December 2019. The deficit so far in fiscal year 2021 has climbed to $572 billion, which is $215 billion more than at this point last year. While revenues in these months were nearly unchanged from last year, outlays have grown by 16% (accounting for timing shifts in payments).

    Analysis of notable trends: December extended the pattern of fiscal year 2021, with little year-over-year change in revenue but a 17% rise in spending. Of all outlays, unemployment insurance benefits—which totaled $3 billion last December but $28 billion this December—contributed the most to the spending increase. (All comparison figures for spending on specific programs have been adjusted to exclude the effects of timing shifts.) This has been a trend: Unemployment insurance benefits have caused almost 40% of greater cumulative spending from this point last year, soaring from $7 billion in the first three months of fiscal year 2020 to $80 billion so far this fiscal year. December's spending on Medicaid (up $12 billion, or 36%, from last December) and Social Security benefits (up $5 billion, or 6%, from last December) further added to the deficit.

    Revenues rose 3% from last December, thanks to greater individual income and payroll tax receipts.

    Tracking the Federal Deficit: November 2020

    The Congressional Budget Office estimates that the federal government ran a deficit of $146 billion in November, the second month of fiscal year 2021. This deficit was the difference between $365 billion of spending and $219 billion of revenue. Spending in November, however, was artificially lowered by the fact that November 1 fell on a weekend, causing $63 billion worth of payments that would normally be made in November to be made in October instead. If those payments had been made in November as usual, this month's spending and deficit would each have been $63 billion greater, or $428 billion (spending) and $209 billion (deficit). In the first two months of this fiscal year, the federal government has run a deficit of $430 billion, $87 billion more than at this point last fiscal year. Compared to this point last fiscal year, spending has run 9% higher while revenues have fallen by 3%.

    Analysis of notable trends: The federal deficit in calendar year 2020 continues to run above comparable months in 2019, albeit by much smaller amounts than during the peak of the federal response to the COVID-19 pandemic and recession several months ago. Accounting for the effects of timing shifts, this November's deficit was $50 billion greater than last November's. By contrast, this June's deficit was $805 billion greater than last June's (also adjusted for timing shifts). With the bulk of extraordinary pandemic spending wound down, the three areas most responsible for the year-over-year increase in the monthly deficit were unemployment insurance (spending up $23 billion year-over-year), entitlements ($6 billion more on Medicare, $4 billion more on Social Security, and $4 billion more on Medicaid), and interest on the debt ($3 billion more than last November).

    Revenues also fell by 3% from last November, mostly reflecting a drop in withheld individual income and payroll taxes due to lower levels of employment.

    Tracking the Federal Deficit: October 2020

    The Congressional Budget Office estimates that the federal government ran a deficit of $284 billion in October, the first month of fiscal year 2021. This deficit is the difference between $238 billion of revenue and $522 billion of outlays. Because November 1 fell on a weekend this year, however, certain payments that would normally be made in November were instead shifted to October, increasing the size of this month's deficit. Without those payments, October's deficit would have been $230 billion.

    Either way, this October's deficit is a large increase from last October's figure of $134 billion. The year-over-year surge in the deficit is the sum of slightly lower revenues—3% lower than last October, mostly due to lower receipts of individual income taxes—and much greater outlays—37% greater than last October (23% greater when accounting for the timing shift of some payments), mainly because of the ongoing response to the COVID-19 pandemic and its economic fallout.

  • FY2020

    Fiscal Year 2020 in Review

    The federal government ran a deficit of $3.1 trillion in fiscal year 2020, more than triple the deficit for fiscal year 2019. This year's deficit amounted to 15.2% of GDP, the greatest deficit as a share of the economy since 1945. FY2020 was the fifth year in a row that the deficit as a share of the economy grew. Revenues in FY2020 fell 1% from last year, while outlays surged 47%.

    The FY2020 budget splits into two distinct halves: before and after COVID-19 and its economic fallout. In the first six months of the fiscal year (October through March), the deficit was running 8% above last year's rate; in the last six months (April through September), the deficit soared to eight times its level in those months last year.

    Through March, revenues had been running 6% above FY2019, propelled by higher wages and salaries that raised individual and payroll tax receipts. In April through September, however, revenues dipped 7% below their rate from the second half of FY2019, pulled down by the loss of economic activity and legislation enacted in response to the crisis. This second-half pattern of revenues dragged down by economic losses and policy changes was present across many types of revenue. Withheld income and payroll taxes fell 8%—because of a weaker economy, with fewer jobs and lower wages; and because of policy changes, which allowed employers to defer payroll tax payments and created refundable payroll tax credits for paid sick leave, family and medical leave, and employee retention. Nonwithheld income and payroll taxes also fell 7%, while corporate income taxes fell by 21%. Both of these declines were the sum of economic losses and legislative changes to lower tax burdens.

    Meanwhile, outlays in the first half of FY2020 grew 7% from last year's rate. Then, from April through September, outlays almost doubled their level from those months last year, a $2 trillion increase. The character of spending increases also changed from the first to the second half of the year. From October through March, higher spending was driven by mandatory programs—Social Security, Medicare, and Medicaid. In the next six months, spending ballooned because of emergency responses to the pandemic and recession. Compared to the same months in FY2019, spending increased in April through September 2020 by:

    • $577 billion from the Small Business Administration, mostly for the Paycheck Protection Program
    • $443 billion on unemployment insurance benefits
    • $274 billion in refundable tax credits, including recovery rebates
    • $112 on the Public Health and Social Services Emergency Fund (which in recent months has mostly reimbursed health care providers for their pandemic-related losses and paid for testing and treatment of COVID-19)
    • A new program, the Coronavirus Relief Fund, which gave aid to state, local, tribal, and territorial governments, spent $149 billion in these months.

    Tracking the Federal Deficit: September 2020

    Each September, the government receives substantial revenue from individual and corporate income taxes, which generally produces a monthly surplus. For example, the federal government recorded an $83 billion surplus last September (or a surplus of $31 billion after accounting for a shift in the timing of some payments). This year, however, greater spending in response to the pandemic and recession dominated the usual revenue increase, and the government ran a monthly deficit of $124 billion. This deficit was the difference between revenues of $372 billion and spending of $496 billion.

    Revenue this September fell 1% from last September, the result of lost economic activity and policy changes allowing some taxes to be deferred or reduced. For instance, individual income and payroll taxes were 5% below last year's level, while corporate income taxes fell 16%. Individual income tax refunds also increased by 68%, further lowering net revenue.

    Meanwhile, spending this September was 70% greater than last September (albeit only 44% greater when accounting for a shift in the timing of some payments). Spending mostly increased in response to the economic fallout from COVID-19. For instance, spending on unemployment insurance benefits increased from $2 billion last September to $35 billion this September. Outlays from the Department of Homeland Security were $27 billion higher this September, almost entirely because of spending from its Disaster Relief Fund that paid for some unemployment compensation. Outlays from the Small Business Administration grew from $85 million last September to $1.8 billion this September. And outlays from the Public Health and Social Services Emergency Fund—which in recent months has mostly reimbursed health care providers for greater costs and lower revenue due to the pandemic and paid for testing and treatment of COVID-19—increased from $192 million last September to $7 billion this September.

    Nonetheless, while spending on these programs far exceeds pre-COVID levels, it's fallen significantly from earlier in 2020. The $62 billion spent on unemployment insurance (including outlays from the Disaster Relief Fund) in September is down 47% from its June peak of $116 billion. $1.8 billion in outlays from the SBA is 99.6% less than its June peak of $511 billion. And the $7 billion of outlays from the Public Health and Social Services Emergency Fund is 82% less than its April peak of $39 billion. Of course, these declines only reflect programs that still spent significant amounts last month. Other major relief programs—like Economic Impact Payments, relief for airline workers, or the Coronavirus Relief Fund (which sent money to state and local governments—no longer account for significant spending at all. In sum, September 2020 saw much greater spending than September 2019, but much less than earlier this year, as the previously enacted federal response to the pandemic and recession continued to wind down.

    Tracking the Federal Deficit: August 2020

    The Congressional Budget Office estimates that the federal government ran a deficit of $198 billion in August, the eleventh month of fiscal year 2020. This deficit—the difference between $223 billion of revenues and $420 billion of outlays—is $3 billion less than last August's, although this apparent improvement is an illusion created by shifts in the timing of certain payments. Without these timing shifts, this August's deficit would have been $106 billion (or 72%) greater than last August's. The cumulative deficit in FY2020 has risen to $3.0 trillion, an increase of $1.9 trillion from this point last year.

    Analysis of notable trends: Cumulative revenue for the fiscal year is down 1% from this point last year, while cumulative outlays are 46% higher. August repeated this asymmetry, with revenues 2% lower than last August's and outlays—netting out the timing shifts described above—27% higher.

    Thanks to a strong economy, this year's revenue through March had been running 6% above last year's. Then COVID-19 hit, and revenues from April through August have come in 9% lower than last year, due to both the loss in economic activity and legislation responding to the pandemic.

    Accounting for timing shifts, about half the increase in outlays from last August to this one came from spending on unemployment insurance benefits. While that spending has soared compared to last year, it has dropped significantly from last month. Adjusted for timing shifts, spending on unemployment insurance benefits ballooned from $2 billion last August to $110 billion this July before falling to $53 billion this August. Other major spending items related to COVID-19 and its economic fallout have followed the same trajectory. Outlays from the Small Business Association—in recent months, mostly loans and guarantees under the Paycheck Protection Program—were $99 million last August, rose to $26 billion this July, and dropped to $12 billion this August (also adjusted for timing shifts). Likewise, spending from the Public Health and Social Services Emergency Fund—which, in recent months, has mostly gone to reimbursing health care providers for costs or lost revenues due to COVID-19 and providing money for testing and treatment of COVID-19—went from $183 million last August to $17 billion this July to $8 billion this August (adjusted for timing shifts).

    CBO now projects that the total deficit this fiscal year will run to $3.3 trillion, more than triple last year's and the largest deficit as a share of the economy since 1945.

    Tracking the Federal Deficit: July 2020

    The Congressional Budget Office estimates that the federal government ran a deficit of $61 billion in July, the tenth month of fiscal year 2020. Although this July's deficit was actually smaller than last July's $120 billion deficit, the change does not represent an improved fiscal condition but a mere timing shift. The deadline for non-withheld individual and corporate income taxes, normally in April, was delayed until July of this year, causing an unusual spike in July revenue (which totaled $563 billion). Even this influx of taxes was overcome by monthly outlays that, at $624 billion, were 68% greater than last July's. The cumulative budget deficit for FY2020 now stands at $2.8 trillion, more than triple the deficit at this point last year.

    Analysis of notable trends: Stepping back from monthly fluctuations caused by the change in filing deadlines, total revenue so far this fiscal year is down 1% from this point last year. Revenues through this March had actually been 6% higher than through the same point last fiscal year, as higher individual and corporate earnings led to greater individual and corporate income tax receipts. Then the pandemic hit. From April through July, revenues are 10% lower than over same months last year, a combination of economic damage and legislation that gave individuals and corporations greater tax deductions.

    While revenue has sagged relative to the prior fiscal year, outlays have exploded—they have been 51% greater so far in FY2020 than at the same point in FY2019. Most of this increase has come from the federal response to the pandemic and its economic fallout, and this was once again the case in July. Federal spending on unemployment insurance benefits was $3 billion last July; it soared to $110 billion this July. A majority of the rise was due to the additional $600 in weekly benefits for all recipients. Meanwhile, outlays through the Small Business Administration rose from $103 million last July to $26 billion this July, mostly because of loans made through the Paycheck Protection Program. UI and PPP have received consistent and large surges in spending since the beginning of the federal coronavirus response: From April through July, SBA outlays have been $564 billion more this year than last, while outlays for UI benefits have risen by $358 billion. Another program that has seen a surge in coronavirus-related spending is the Public Health and Social Services Emergency Fund, which, in recent months, has mostly gone to reimbursing health care providers for costs or lost revenues due to COVID-19 and providing money for testing and treatment of COVID-19. Congress spent $243 million on this fund last July, but $17 billion this July.

    Tracking the Federal Deficit: June 2020

    The Congressional Budget Office reported that the federal government ran a deficit of $864 billion in June, the ninth month of fiscal year 2020. This monthly deficit is more than 100 times larger than last June's deficit of $8 billion. This difference came from a sizable drop in revenues, which were down 28% from last June (from $334 billion to $241 billion), and especially from a massive increase in outlays, up 223% from last June (from $342 billion to $1.105 trillion). The budget deficit so far this fiscal year has surged to $2.7 trillion, $2 trillion more than at the same point last year. As exemplified by June, the cumulative difference stems from a drop in revenues—13% lower than at the same point last year—and a much bigger leap in outlays—49% higher than at this time last year.

    Analysis of notable trends: June represented another record-breaking deficit. Monthly deficits continue to be pushed upward by the federal government's response to the COVID-19 emergency: The biggest fiscal change between last June and this one was on the spending side, and the biggest spending changes were from coronavirus-related programs. Outlays from the Small Business Administration, which funds the Paycheck Protection Program, soared from $80 million last June to $35 billion this May to $511 billion this June. Almost half of all government spending in June was through the SBA. Meanwhile, federal spending on unemployment insurance benefits rose from $2 billion last June to $93 billion this May to $116 billion this June. Half of the increase between last June and this June came from the $600 per month increase in benefit amounts. Finally, the Public Health Social Services Emergency Fund—which in recent months has reimbursed health care providers for health costs or lost revenues due to the pandemic, as well as paying for COVID-19 testing and treatments—went from $300 million last June to $14 billion this June (down from $27 billion in May).

    The drop in revenue between last June and this one was due almost entirely to the administration delaying the deadline for quarterly tax payments from June 15 to July 15. Monthly revenue was down $93 billion compared to a year ago, of which $43 billion came from delaying corporate tax payments while $42 billion came from delaying individual and payroll tax payments. CBO expects most of this delayed revenue to eventually be collected, although some will be lost as businesses fail before the new payment deadlines.

    Tracking the Federal Deficit: May 2020

    The Congressional Budget Office reported that the federal government ran a deficit of $399 billion in May, the eighth month of fiscal year 2020. This represents almost double the monthly deficit recorded in May 2019. So far this fiscal year, the budget deficit has mounted to $1.88 trillion, more than two-and-a-half times as large as at this point last year (when it was $739 billion). Total revenues so far this fiscal year are down 11% ($256 billion) compared to the same point last year, while outlays are up 29% ($886 billion).

    Analysis of notable trends: CBO notes that the fiscal year so far can be split into two distinct parts: one before the new coronavirus had affected economic output and federal finances (October through March) and one in which the pandemic had ravaged both (April and May). In the pre-coronavirus part of the year, outlays and revenues were each higher than at the same point last year. During the past two months, however, outlays soared (up 30% this May compared to last) while revenues evaporated (25% lower this May than last).

    Outlays have surged in response to the health emergency itself and the resulting economic fallout: for example, spending on unemployment insurance soared from $2 billion last May to $93 billion this May; spending on refundable tax credits (at this moment, mainly the Economic Impact Payments) surged from $3 billion last May to $53 billion this May; outlays from the Small Business Administration (at this moment, mostly loan guarantees from the Paycheck Protection Program) rose from $98 million last May to $35 billion this May; and spending on the Public Health Social Services Emergency Fund (in recent months, mostly reimbursing health care providers for costs and lost revenue stemming from the pandemic and paying for public health measures like testing and vaccine development) climbed from $250 million last May to $27 billion this May.

    On the revenue side, most of the drop in May relative to last year is from individual income and payroll taxes, which together dropped by 24% ($51 billion). While much of this drop is due to job loss and reduced incomes, some also derives from the shift in tax deadlines passed in the CARES Act, such as the ability for employers to defer their payroll taxes until the end of this calendar year.

    Tracking the Federal Deficit: April 2020

    The Congressional Budget Office reported that the federal government generated a $737 billion deficit in April, the seventh month of fiscal year 2020. April's deficit is a $897 billion swing from the $160 billion surplus recorded a year earlier in April 2019. April's shortfall brings the total deficit so far this fiscal year to $1.48 trillion, which is 179% ($949 billion) higher than the same period last year. Total revenues so far in FY2020 decreased by 10% ($200 billion), while spending increased by 29% ($749 billion), compared to the same period last year.

    Analysis of Notable Trends: The $737 billion deficit in April is by far the largest monthly shortfall as a share of the economy in the past 40 years (since the data was collected). Similarly, the $1.48 trillion deficit so far this fiscal year is on track to be the largest deficit as a share of the economy since World War II. These figures reflect the COVID-19 pandemic and the federal government's emergency measures responding to it. In April 2020, federal income and payroll tax revenues fell 55% ($258 billion) compared to last April, primarily reflecting the millions of Americans who have been laid off or furloughed. (The income tax decline also reflects the delayed April 15 tax filing deadline.) Meanwhile, relief packages enacted by lawmakers led federal spending in April to more than double (from last April) to $976 billion. Spending on unemployment insurance rose from $3 billion in April 2019 to $49 billion this year, reflecting major expansions in the program. The recently enacted Economic Impact Payments to individual households totaled roughly $200 billion. Other major increases in April outlays were the Coronavirus Relief Fund providing aid to state and local governments of $142 billion and initial expenditures for the Paycheck Protection Program for small businesses of $15 billion. Medicare spending also tripled to $152 billion. Finally, the federal government spent an additional $40 billion on aid to health care providers for combatting COVID-19.

    Tracking the Federal Deficit: March 2020

    The Congressional Budget Office reported that the federal government generated a $117 billion deficit in March, the sixth month of fiscal year 2020. March's deficit is a $30 billion decrease from the $147 billion deficit recorded a year earlier in March 2019. (If not for timing shifts of certain payments, the deficit in March would have been $169 billion, or $22 billion more than in March 2019.) March's deficit brings the total deficit so far this fiscal year to $741 billion, which is 7% ($50 billion) higher than the same period last year. Total revenues so far in FY2020 increased by 6% ($97 billion), while spending increased by 7% ($147 billion), compared to the same period last year.

    Analysis of Notable Trends in This Fiscal Year to Date: Through the first six months of FY2020, federal reserve remittances increased by 22% ($6 billion) because of lower short-term interest rates, which decreased the Federal Reserve's interest expenses and increased its payments to the Treasury. As in previous months, the rise in spending was driven by increasing expenditures on the military (7%, or $22 billion), Social Security, Medicare, and Medicaid (6%, or $57 billion total), and net interest on the public debt (5%, or $10 billion). Notably, the March 2020 report was not significantly impacted by the new coronavirus pandemic nor the federal government's emergency measures responding to it. CBO anticipates that those budgetary effects will be more noticeable in April.

    Tracking the Federal Deficit: February 2020

    The Congressional Budget Office reported that the federal government generated a $235 billion deficit in February, the fifth month of fiscal year 2020. February's deficit is a $1 billion increase from the $234 billion deficit recorded a year earlier in February 2019. (If not for timing shifts of certain payments, the deficit in February would have been $238 billion, or $4 billion more than in February 2019.) February's deficit brings the total deficit so far this fiscal year to $625 billion, which is 15% ($80 billion) higher than the same period last year (or $28 billion higher once timing shifts are accounted for). Total revenues so far in FY2020 increased by 7% ($88 billion), while spending increased by 9% ($168 billion), compared to the same period last year. (After accounting for timing shifts, spending rose by 6% or $116 billion.)

    Analysis of Notable Trends in This Fiscal Year to Date:  Through the first five months of FY2020, individual income tax refunds fell by 6% ($5 billion), increasing net revenue, as the timing of refund payments varies annually. Customs duties rose by 14% ($4 billion), partly due to tariffs imposed by the current administration, primarily on imports from China. On the spending side, net interest on the public debt increased by 6% ($10 billion)—even amidst historically low interest rates—because the overall debt burden has risen. Outlays for the Department of Veterans Affairs rose by 7% ($6 billion) because of rising participation in veterans' disability compensation, growing average disability benefits, and increasing spending on a program that helps veterans receive treatment in non-VA facilities.

    Tracking the Federal Deficit: January 2020

    The Congressional Budget Office reported that the federal government generated a $32 billion deficit in January, the fourth month of fiscal year 2020. January's deficit is a $40 billion change from the $9 billion surplus recorded a year earlier in January 2019. (If not for timing shifts of certain payments, the federal government would actually have realized a $1 billion surplus in January 2020 and a $12 billion deficit in January 2019.) January's deficit brings the total deficit so far this fiscal year to $388 billion, which is 25% ($78 billion) higher than the same period last year (or $23 billion higher once timing shifts are accounted for). Total revenues so far in FY2020 increased by 6% ($67 billion), while spending increased by 10% ($145 billion), compared to the same period last year. (After accounting for timing shifts, spending rose by 6% or $90 billion.

    Analysis of Notable Trends in This Fiscal Year to Date: Through the first four months of FY2020, revenue from corporate income taxes rose by 27% ($16 billion). Additionally, Federal Reserve remittances increased by 14% ($3 billion) partly due to lower short-term interest rates that reduced its interest expenses. On the spending side, after accounting for timing shifts, total Social Security, Medicare, and Medicaid outlays rose by 6% ($41 billion). Outlays for the Department of Defense rose by 7% ($14 billion), largely for procurement and research and development.

    Tracking the Federal Deficit: December 2019

    The Congressional Budget Office reported that the federal government generated a $15 billion deficit in December, the third month of fiscal year 2020. December's deficit is 7% ($1 billion) higher than the deficit recorded a year earlier in December 2018. (If not for timing shifts of certain payments, the deficit in December would have been roughly $42 billion, or $4 billion more than the adjusted deficit from a year ago.) December's deficit brings the total deficit so far this fiscal year to $358 billion, which is 12% ($39 billion) higher than the same period last year. Total revenues so far in FY2020 increased by 5% ($35 billion), while spending increased by 7% ($74 billion), compared to the same period last year.

    Analysis of Notable Trends in This Fiscal Year to Date: Through the first three months of FY2020, revenue from excise taxes fell by 33% ($10 billion), relative to the same period in 2018, due to a one-year moratorium of the tax on health insurance providers (the "Cadillac tax," which has since been repealed). Conversely, revenue from customs duties increased by 18% ($3 billion) as a result of additional tariffs imposed by the current administration, primarily on imports from China. On the spending side, outlays for Department of Defense programs rose by 10% ($16 billion), mostly for procurement. Additionally, Fannie Mae and Freddie Mac began making smaller payments to the Treasury in order to replenish their capital reserves, resulting in an an 88% ($7 billion) decline in net payments (recorded in the federal budget as an increase in net outlays).

    Tracking the Federal Deficit: November 2019

    The Congressional Budget Office reported that the federal government generated a $207 billion deficit in November, the second month of fiscal year 2020. November's deficit is 1% ($2 billion) higher than the deficit recorded a year earlier in November 2018. (If not for timing shifts of certain payments, the deficit in November would have been roughly $158 billion, or $2 billion lower than the adjusted deficit from a year ago.) November's deficit brings the total deficit so far this fiscal year to $342 billion, which is 12% ($36 billion) higher than the same period last year (or $32 billion higher once timing shifts are accounted for). Total revenues so far in FY2020 increased by 3% ($12 billion), while spending increased by 6% ($49 billion), compared to the same period last year.

    Analysis of Notable Trends in This Fiscal Year to Date: Through the first two months of FY2020, revenue from excise taxes fell by 40% ($9 billion), relative to the same period in 2018, due to a one-year moratorium of the tax on health insurance providers. Conversely, revenue from customs duties increased by 32% ($4 billion) as a result of additional tariffs imposed by the current administration, primarily on imports from China. On the spending side, outlays for Social Security, Medicare, and Medicaid rose by 7% ($22 billion), and spending on education rose by 25% ($3 billion), largely the result of rising subsidy costs for federal student loans.

    Tracking the Federal Deficit: October 2019

    The Congressional Budget Office reported that the federal government generated a $133 billion deficit in October, the first month of fiscal year 2020. October's deficit is 33% ($33 billion) more than the deficit recorded a year earlier in October 2018.

  • FY2019

    Tracking the Federal Deficit: September 2019 (end of the fiscal year)

    The Congressional Budget Office reported that the federal government generated a surplus of $83 billion in September, the final month of Fiscal Year 2019. This brings the total FY2019 deficit to $984 billion, 26 percent ($205 billion) higher than last year's deficit. If not for timing shifts of certain payments, this year's deficit would have been 21 percent ($162 billion) larger than the deficit in FY2018. On an apples-to-apples basis, total revenues in FY2019 increased by 4 percent ($133 billion), while spending increased by 7 percent ($294 billion), compared to the prior fiscal year.

    Analysis of Notable Trends for Fiscal Year 2019: Corporate income tax revenue increased by 14 percent ($25 billion) relative to 2018, although that year notably was tied for the lowest corporate revenue level (1.0 percent) as a share of the economy since 1965, a result of the Tax Cuts and Jobs Act of 2017 (TCJA). Customs duties increased by 71 percent ($29 billion) versus last year due to the imposition of tariffs, specifically on certain imports from China. On the spending side, outlays from the refundable earned income and child tax credits increased by 14 percent ($11 billion) versus last year, reflecting expansions enacted in TCJA. Finally, payments for net interest on the public debt rose by an alarming 14 percent ($52 billion), largely due to higher short-term interest rates and a growing federal debt burden on which those interest payments are owed.

    Tracking the Federal Deficit: August 2019

    The Congressional Budget Office reported that the federal government generated a $200 billion deficit in August, the eleventh month of Fiscal Year 2019. This makes for a total deficit of $1.067 trillion so far this fiscal year, 19 percent ($168 billion) higher than over the same period last year. (Excluding timing shifts of certain payments, the total deficit so far this fiscal year is 17 percent—$137 billion—higher than over the same period last year.) Total revenues so far in FY 2019 increased by 3 percent ($102 billion), while spending increased by 7 percent ($271 billion), compared to the same period last year.

    Analysis of Notable Trends this Fiscal Year to Date: Trends in the major categories of revenue and spending continued from previous months—compared to last year, individual income and payroll taxes collectively rose by 3 percent ($82 billion), while spending for the largest mandatory programs (Social Security, Medicare, and Medicaid) collectively increased by 6 percent ($105 billion). Revenues from customs duties increased by 72 percent ($26 billion), primarily due to new tariffs imposed on certain imports from China. Estate tax revenue decreased by 25 percent ($5 billion) due to the 2017 tax cuts which doubled the value of the estate tax exemption. Additionally, Fannie Mae and Freddie Mac remitted $16 billion more in payments to the Treasury this year. Finally, net interest payments on the federal debt continued to rise, increasing by 14 percent ($48 billion) versus last year due to higher interest rates and a larger federal debt burden.

    Tracking the Federal Deficit:   July 2019

    The Congressional Budget Office reported that the federal government generated a $120 billion deficit in July, the tenth month of Fiscal Year 2019. This makes for a total deficit of $867 billion so far this fiscal year, 27 percent ($184 billion) higher than over the same period last year (excluding timing shifts of certain payments, the total deficit so far this fiscal year is 20 percent—$140 billion—higher than over the same period last year). Total revenues so far in Fiscal Year 2019 increased by 3 percent ($92 billion), while spending increased by 8 percent ($276 billion), compared to the same period last year.

    Analysis of Notable Trends this Fiscal Year to Date: Increased revenues were driven mostly by a 7 percent ($65 billion) increase in payroll taxes due to the strong labor market that has resulted in continued job growth and rising wages. On the spending side, outlays for Social Security, Medicare, and Medicaid increased by a combined 6 percent ($46 billion, $37 billion, and $18 billion, respectively). Department of Education outlays rose by 79 percent ($40 billion), mostly due to an upward revision to the net subsidy costs of previously issued student loans. Finally, net interest payments on the federal debt continued to rise, increasing by 14 percent ($44 billion) versus last year due to higher interest rates and a larger federal debt burden.

    Tracking the Federal Deficit:   June 2019

    The Congressional Budget Office reported that the federal government generated an $8 billion deficit in June, the ninth month of Fiscal Year 2019, for a total deficit of $746 billion so far this fiscal year. If not for timing shifts of certain payments, June's deficit would have been  $57 billion, which is $28 billion (97 percent) larger than the adjusted deficit for June 2018. Total revenues so far in Fiscal Year 2019 increased by 3 percent ($69 billion), while spending increased by 7 percent ($208 billion), compared to the same period last year.

    Analysis of Notable Trends this Fiscal Year to Date: Individual and payroll taxes together rose by 3 percent ($60 billion), reflecting an expanding economy and a low unemployment rate. Furthermore, customs duties increased by 77 percent ($22 billion) versus last year, primarily due to the imposition of new tariffs. On the spending side, Social Security expenditures increased by 6 percent ($42 billion) compared to last year due to increases in the number of beneficiaries and the average benefit payment. Finally, net interest payments on the federal debt continued to rise, increasing by 16 percent ($44 billion) versus last year due to higher interest rates and a larger federal debt burden.

    Tracking the Federal Deficit:   May 2019

    The Congressional Budget Office reported that the federal government generated a $207 billion deficit in May, the  eighth month of Fiscal Year 2019, for a total deficit of  $738 billion so far this fiscal year. May's deficit is 41 percent ($60 billion) more than the deficit recorded a year earlier in May 2018. If not for timing shifts of certain payments, the deficit would have been 7 percent ($11 billion) larger than the deficit in May 2018. Total revenues so far in Fiscal Year 2019 increased by 2 percent ($49 billion), while spending increased by 9 percent ($255 billion), compared to the same period last year.

    Analysis of Notable Trends this Fiscal Year to Date: Corporate income tax receipts were down by 9 percent ($11 billion) compared to last year, reflecting the lower marginal corporate tax rate enacted in the Tax Cuts and Jobs Act of 2017. Further, customs duties increased by 78 percent ($19 billion) versus last year, due to the imposition of new tariffs. On the spending side, Department of Defense spending increased by 10 percent ($39 billion) compared to last year, particularly on military operations, maintenance, procurement, and R&D. Finally, net interest payments on the federal debt continued to rise, increasing by 16 percent ($37 billion) versus last year due to higher interest rates and a larger federal debt burden.

    Tracking the Federal Deficit: April 2019

    The Congressional Budget Office reported that the federal government generated a $161 billion surplus in April, the seventh month of Fiscal Year 2019, for a total deficit of $531 billion so far this fiscal year. April's surplus is 33 percent ($54 billion) less than the surplus recorded a year earlier in April 2018. If not for timing shifts of certain payments, the surplus would have been 5 percent ($8 billion) smaller than the surplus in April 2018. Total revenues so far in Fiscal Year 2019 increased by 2 percent ($36 billion), while spending increased by 6 percent ($135 billion), compared to the same period last year.

    Analysis of Notable Trends this Fiscal Year to Date: Income tax refunds were down by 5 percent ($12 billion) compared to last tax season, contrary to many analysts' expectations. Further, outlays from the refundable earned income and child tax credits increased by 12 percent ($9 billion) versus last year, reflecting expansions enacted in the Tax Cuts and Jobs Act of 2017. Net interest payments on the public debt continued to rise, up 13 percent ($27 billion) compared to last year, largely as a result of higher interest rates and the nation's steadily growing debt burden.

    Tracking the Federal Deficit: March 2019

    The Congressional Budget Office reported that the federal government generated a $149 billion deficit in March, the sixth month of Fiscal Year 2019, for a total deficit of $693 billion so far this fiscal year. March's deficit is 29 percent ($60 billion) less than the deficit recorded a year earlier in March 2018. If not for timing shifts of certain payments, the deficit would have been 9 percent ($14 billion) smaller than the deficit in March 2018. Total revenues so far in Fiscal Year 2019 increased by 0.6 percent ($9 billion), while spending increased by 5 percent ($103 billion), compared to the same period last year.

    Analysis of Notable Trends this Fiscal Year to Date: Customs duties increased by 86 percent ($16 billion) compared to last year. On the spending side, outlays for Social Security, Medicare, and Medicaid increased by a combined 4 percent ($26 billion, $10 billion, and $5 billion, respectively). Department of Defense spending rose by 9 percent ($28 billion), and net interest payments on the national debt were up by 13 percent ($22 billion), largely due to interest rates on short term debt being substantially higher now than they were during the first half of Fiscal Year 2018.

    Tracking the Federal Deficit: February 2019

    The Congressional Budget Office reported that the federal government generated a $227 billion deficit in February, the fifth month of Fiscal Year 2019, for a total deficit of $537 billion so far this fiscal year. February's deficit is 5 percent ($12 billion) higher than the deficit recorded a year earlier in February 2018. Total revenues so far in Fiscal Year 2019 decreased by 0.3 percent ($4 billion), while spending increased by 8.5 percent ($142 billion), compared to the same period last year.

    Analysis of Notable Trends this Fiscal Year to Date: Income tax refunds were down by 10 percent ($10 billion) from October-February 2019 compared to the same period in Fiscal Year 2018, and corporate income tax receipts were down by 19 percent ($14 billion) from October-February 2019 relative to the same period in Fiscal Year 2018. The dip in corporate revenues is primarily attributable to the Tax Cuts and Jobs Act of 2017. On the spending side, Department of Homeland Security outlays decreased by 31 percent ($11 billion) due to a relative decrease in disaster spending versus last year. Conversely, net interest payments on the national debt were up 15 percent ($20 billion) from October-February 2019 compared to the same period in Fiscal Year 2018.

    Tracking the Federal Deficit: December 2018

    The Congressional Budget Office reported that the federal government generated an $11 billion deficit in December, the third month of Fiscal Year 2019, for a total deficit of $317 billion so far this fiscal year. If not for timing shifts of certain payments, the deficit in December would have been roughly $32 billion, according to CBO. December's deficit is 52 percent ($12 billion) lower than the deficit recorded a year earlier in December 2017. Total revenues so far in Fiscal Year 2019 increased by 0.1 percent ($2 billion), while spending increased by 9.4 percent ($93 billion), compared to the same period last year.

    Analysis of Notable Trends in December 2018: Revenue from customs duties spiked by 83 percent ($8 billion) from October-December 2018, relative to the same period in 2017, due to the administration's imposition of new tariffs. Conversely, corporate income tax revenue declined by 15 percent ($9 billion) from October-December 2018 relative to the same period in 2017. This dip mainly reflects the reduction of corporate tax rates enacted in the Tax Cuts and Jobs Act of 2017. On the spending side, interest payments on the federal debt in December 2018 rose by 47 percent ($11 billion) relative to December 2017.

    Tracking the Federal Deficit: November 2018

    The Congressional Budget Office reported that the federal government generated a $203 billion deficit in November, the second month of Fiscal Year 2019, for a total deficit of $303 billion so far this fiscal year. If not for timing shifts of certain payments, the deficit in November would have been roughly $158 billion, according to CBO. November's deficit is 46 percent ($64 billion) higher than the deficit recorded a year earlier in November 2017. Total revenues so far in Fiscal Year 2019 increased by 3 percent ($14 billion), while spending increased by 18 percent ($115 billion), compared to the same period last year.

    Analysis of Notable Trends in November 2018: Department of Homeland Security spending fell by 46 percent ($4 billion) relative to November 2017, reflecting a decrease in spending on disaster relief. Conversely, Social Security spending (benefit payments) increased by 5 percent ($4 billion) compared to November 2017.

    Tracking the Federal Deficit: October 2018

    Analysis of Notable Trends in October 2018:The Congressional Budget Office reported that the federal government generated a $98 billion deficit in October, the first month of Fiscal Year 2019. October's deficit is 56 percent ($35 billion) higher than the deficit recorded a year earlier in October 2017. Total revenues increased by 7 percent ($17 billion), while spending increased by 18 percent ($55 billion), compared to a year earlier.

  • FY2018

    End of Fiscal Year 2018

    This entry reflects the U.S. Treasury Department's official end-of-year spending, revenue, and deficit figures for Fiscal Year 2018, as released in its Final Monthly Treasury Statement for Fiscal Year 2018.

    The total deficit for FY 2018 is $779 billion, with total spending clocking in at $4.1 trillion and total revenue at $3.3 trillion. The deficit grew by 17 percent ($113 billion) compared to FY 2017 and is the highest federal deficit in six years (since FY 2012). While spending grew by about 3 percent ($127 billion) in FY 2018, revenue grew by less than 1 percent ($14 billion). Disturbingly, federal interest payments on the debt spiked to $372 billion — up 20 percent ($62 billion) from FY 2017 — reflecting the largest year-over-year increase in over a decade (both in terms of nominal and inflation-adjusted dollars).

    October 5, 2018

    The Congressional Budget Office reports that the federal government generated a $782 billion deficit for Fiscal Year 2018, about 17 percent ($116 billion) higher than the deficit for FY 2017. However, about $44 billion in payments that normally would have been included in FY 2018, which ended Sept. 30, fell on a weekend and instead were made in FY 2019. If not for these payment timing shifts, the FY 2018 deficit would have been even larger, estimated at $826 billion. Revenues in FY 2018 remained almost entirely flat, growing by less than 1 percent. While some revenue sources such as individual income tax collection grew by about 6 percent ($96 billion), others such as corporate income tax collection shrank dramatically by about 31 percent ($92 billion). As revenue stagnated, federal spending continued to climb by 3 percent ($129 billion). Spending on the three largest mandatory programs — Social Security, Medicare, and Medicaid — rose by 4 percent ($73 billion). In continuation of a disturbing trend, interest payments on the federal debt were the fastest growing portion of the budget, up 20 percent ($62 billion) from FY 2017. Total interest payments on the federal debt for FY 2018 were $371 billion, nearly as much as the federal government spent on the Medicaid program over the same period (all spending figures adjusted by CBO to remove the effects of timing shifts).

    September 10, 2018

    The federal government produced a monthly budget deficit of $211 billion in August, up from $108 billion during the same month last year. The cumulative Fiscal Year 2018 deficit now stands at $895 billion, exceeding by more than $100 billion CBO's latest projection for that period. It is important to note that due to the calendar, payments of about $68 billion normally made in September were made in August. For this reason, August's cumulative deficit is larger than it otherwise would have been, which will be offset by a lower deficit in September.

    This year's cumulative deficit is 33 percent ($222 billion) higher than for the same period last year. According to CBO, while federal revenues have increased by 1 percent ($19 billion) over the first 11 months of FY 2018, federal outlays have increased by 7 percent ($240 billion). Outlays rose across all major categories, including interest spending, defense spending, and spending on major entitlement programs. Key drivers of the increased deficit year-over-year in the month of August alone (adjusted by CBO to remove the effects of timing shifts) were: interest spending up 25 percent ($7 billion); defense spending up 10 percent ($5 billion); and Social Security and Medicare spending up 5 percent and 7 percent respectively ($4 billion each).

    August 7, 2018

    The federal government generated a monthly budget deficit of $75 billion in July, bringing the cumulative Fiscal Year (FY) 2018 deficit to $682 billion. This year's deficit is 20 percent ($116 billion) higher than last year's cumulative deficit over the same period. Cumulative interest payments on the federal debt increased again this month relative to the same period last year, totaling $309 billion so far this fiscal year. The Congressional Budget Office attributes this 19 percent ($48 billion) year-over-year increase in interest spending to several factors: a higher rate of inflation, higher interest rates, and a larger debt burden. Other increases in spending compared to July 2017 included a 5 percent increase in spending on Social Security ($4 billion) and an 8 percent increase in defense spending ($3 billion). Total revenues for the month were down about 3 percent ($7 billion). Fiscal year to date, revenues have increased by about 5 percent ($105 billion), despite a 28 percent ($66 billion) drop in corporate tax collections. This drop has been more than offset by an 8 percent ($104 billion) increase in individual income tax collections so far this fiscal year.

    July 10, 2018

    In June, the federal government produced a monthly budget deficit of $75 billion, bringing the cumulative Fiscal Year 2018 deficit to $607 billion. This year's deficit is $84 billion higher than last year's cumulative deficit over the same period. The primary reason on the spending side is interest payments, which have increased by 17 percent ($39 billion) through the month of June compared to the same period in 2017. Spending on the three largest mandatory programs—Social Security, Medicare, and Medicaid—has increased by 4 percent ($115 billion) versus the comparable period in 2017. On the revenue side, corporate income taxes are 28 percent lower ($62 billion) compared to the same period in 2017. About a third of this dip occurred in June, which CBO attributes to a decrease in corporate tax collection largely due to the implementation of the Tax Cuts and Jobs Act of 2017. Provisions lowering the corporate tax rate and expanding the ability of corporations to immediately deduct the full value of equipment purchases particularly had an impact on the revenue decline. But overall revenues have increased slightly compared to last year, driven by individual income and payroll tax collections, which rose by 5 percent ($105 billion) compared to the same period in 2017. This increase is partially attributable to a growing workforce and increases in wages and salaries subject to taxation.

    June 7, 2018

    The federal government produced a monthly budget deficit of $144 billion in May, up from $88 billion during the same month last year. May's shortfall brings the cumulative Fiscal Year 2018 deficit to $530 billion, 22 percent higher than last year's cumulative deficit over the same period. CBO attributes the increased deficit through last month in part to increases in interest spending, up 15 percent (or $32 billion) compared to this point last year. In the month of May alone, interest payments rose by 26 percent (or $7 billion) compared to May 2017, perhaps partially reflecting the trend of rising rates on U.S. Treasury securities. Also, corporate tax collections through May fell by 25 percent (or $42 billion) compared to the same period in FY2017. Conversely, individual income and payroll tax payments through May were up 6 percent (or $109 billion) compared to the same point last year. Spending increases in Medicare, Medicaid, defense, and other programs also contributed to the year-over-year deficit increase in FY2018 to date.

    May 7, 2018

    As usual, April produced a monthly budget surplus, as the government received hundreds of billions of dollars in tax returns during the month. An extraordinary $218 billion surplus in April prompted the cumulative 2018 budget deficit to shrink to $382 billion so far this fiscal year. Last year, the government had accrued a smaller $344 billion deficit through April, and the year before it was even lower. CBO partly attributes this year's larger deficit to increases in interest spending (up 14 percent vs. last year), Department of Homeland Security spending (mainly disaster relief), as well as increases in spending on Social Security and defense. At the same time, revenues are up overall compared to last year, due mainly to an 8 percent increase from individual income and payroll taxes. Conversely, corporate income taxes declined precipitously compared to last year (by 22 percent), which may reflect behavior influenced by the recent tax legislation.

Methodological Note:

The monthly tracker entries report preliminary spending, revenue, and deficit data from CBO's Monthly Budget Reviews. These summaries are released around the fifth business day of every month and preview the release of official budget data from the Treasury Department, which follows on roughly the eighth business day of every month (except end-of-year data, which tends to be released later in October). Historically, CBO's preliminary data is accurate, often differing from Treasury's final figures by only a few billion dollars, if at all. For example, CBO preliminarily reported that the total FY2019 deficit was $984 billion in their September 2019 review, matching the official figure that Treasury later reported.

The deficit tracker graphic is updated retroactively with official Treasury data, whereas the monthly text entries are not.

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Where Did the Money Go That Increased the Deficit?

Source: https://bipartisanpolicy.org/report/deficit-tracker/

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