The federal budget deficit was $1.8 trillion in fiscal year 2025, the Congressional Budget Office estimates, $8 billion less than the shortfall recorded during fiscal year 2024. Revenues increased by an estimated $308 billion (or 6 percent); increases in collections of individual income taxes and customs duties were partially offset by a decline in corporate tax receipts. Outlays rose by an estimated $301 billion (or 4 percent). Outlays were higher in several areas, including the largest benefit programs and net interest on the public debt.
The change in the deficit was influenced by the timing of outlays in fiscal year 2024, which were reduced because payments that were due on October 1, 2023, a Sunday, were shifted into fiscal year 2023 (they were made in September 2023). If not for those shifts, the 2025 deficit would have been $80 billion (or 4 percent) less than the shortfall in 2024.
CBO’s estimate of the deficit for 2025 is slightly smaller than the shortfall CBO anticipated in the January 2025 baseline projections. Those projections were based on legislative and administrative actions through early December 2024; subsequent actions are included in the numbers in this report. CBO now estimates that, all told, revenues and outlays alike were slightly more than the totals projected in January. The current deficit estimate of $1.8 trillion is consistent with updated projections that CBO published last month.
Early in the next calendar year, CBO will publish The Budget and Economic Outlook: 2026 to 2036. That report will provide CBO’s economic and budgetary projections for the 2026‑2036 period, and cover such topic areas as the 2025 reconciliation act, tariffs, and immigration.
The House and Senate Committees on the Budget have instructed CBO to publish the Monthly Budget Review during the current lapse in federal appropriations because the report provides information that the Congress needs to carry out its Constitutional functions. Because of the lapse in funding, some data that CBO typically would use for its analysis were unavailable.
