DoD's 2026 Budget Request and Plan for Funding Provided by the 2025 Reconciliation Act

This document describes the Congressional Budget Office's analysis of the Department of Defense's (DoD's) plans for fiscal year 2026, as reflected in DoD's 2026 budget request, and the implications of those plans for defense costs through 2040.

In most years, CBO's long-term projections of defense costs are based on DoD's Future Years Defense Program (FYDP), a five-year plan outlining how DoD expects to align its resources with its strategies and programs. No FYDP was released in 2026. As a result, CBO based its projections on the 2026 budget request. CBO's analysis also draws from the 2025 FYDP (DoD's most recent five-year plan) and other DoD planning documents, including the National Defense Strategy, the Navy's 30-year shipbuilding plans, and Selected Acquisition Reports. CBO otherwise used the same methods as in its previous long-term projections. (For details about those methods, see How CBO Projects the Long-Term Costs of the Department of Defense's Future Years Defense Program.)

This analysis focuses on DoD's base budget, which excludes supplemental and emergency funding, to capture the enduring costs of defense—that is, costs that are expected to continue over the long term, regardless of whether the United States is actively engaged in a specific conflict. The 2026 budget request included significant funding provided by the 2025 reconciliation act (Public Law 119-21), which complicates projections of those enduring costs.

Since this analysis was completed, DoD has released its 2027 budget request. The current analysis provides a basis for analyzing that request.

Summary of CBO's Main Findings

DoD's 2026 budget request totaled $961 billion, including $113 billion in funding provided by the 2025 reconciliation act. Adjusted for inflation, that request was one of the largest over the past 50 years.

Most of the reconciliation funding in DoD's 2026 budget request was allocated to acquisition. Total funding for acquisition exceeded amounts anticipated in the 2025 FYDP, but base-budget funding for acquisition was lower than anticipated. That pattern suggests that reconciliation funding is substituting for, not just supplementing, base-budget resources.

Smaller amounts of reconciliation funding were allocated to operation and support and to infrastructure, without corresponding decreases in base-budget funding. That reconciliation funding was largely used to enhance resources for operation and maintenance (O&M).

The use of reconciliation funding and the absence of a 2026 FYDP create uncertainty about DoD's future costs. Reconciliation funding was not provided through the usual appropriation titles and accounts and is available over multiple years. In its projection, CBO treats the funding as a one-year increase. If funding persists at 2026 levels, enduring defense costs will be higher than projected.