The federal budget deficit totaled $1 trillion in the first five months of the 2026 fiscal year, according to the monthly budget review released Monday by the Congressional Budget Office.
The total is $142 billion smaller than the deficit recorded in the first five months of the 2025 fiscal year.
Outlays were $64 billion or 2% higher, while revenues were $206 billion or 11% higher. The jump in revenues was driven by the collection of individual and payroll taxes, which accounted for about two-thirds of the increase. The collection of customs duties rose, as well, driven by President Trump’s unilateral imposition of higher tariffs on foreign-made goods. Some of Trump’s tariffs were overturned by the Supreme Court in late February, dampening those collections.
Corporate tax receipts fell by 23%, offsetting some of the increase in individual income taxes and customs duties.
Major outlays that saw significant increases relative to the previous year include Social Security (up 8%), Medicare (up 9%) and Medicaid (up 8%). Spending on interest for the national debt was up by 8%, as well, while defense spending rose by 4%.
Outlays dropped sharply at some federal departments. Spending at the Environmental Protection Agency plummeted by 74%, while outlays at the Department of Homeland Security were down by 23%, driven largely by a drop in disaster response expenditures.