The U.S. federal budget deficit totaled $1.8 trillion in FY2025, a decline of -$41 billion (-2% YoY) from FY2024, reflecting stronger revenue growth and moderate spending increases, while net interest surpassed $1 trillion for the first time. The deficit equaled 5.9% of GDP (down from 6.3% in FY2024), and public debt rose to 99.8% of GDP (from 97.4%).

• Total receipts rose +6% (+$317B YoY) to $5.23T, or 17.3% of GDP, matching the 50-year average. The gain was led by individual income taxes (+$230B, +9%), which rose to 8.8% of GDP, their second-highest share in decades.

• Payroll tax receipts increased +2% (+$39B), while corporate income taxes fell -15% (-$78B) to 1.5% of GDP, partly reflecting larger deductions from the 2025 reconciliation act.

• Customs duties and tariffs surged +153% (+$118B) to 0.6% of GDP, far above the long-run average of 0.2%, as new tariff measures took effect earlier in the year.

• Total outlays increased +4% (+$275B YoY) to $7.01T, or 23.1% of GDP, slightly below FY2024’s ratio but above the 50-year average of 21.2%. Adjusted for timing shifts, outlays grew +3%.

• The largest mandatory programs—Social Security (+$121B, +8%), Medicare (+$77B, +8%), and Medicaid (+$51B, +8%)—accounted for nearly all spending growth.

• Net interest on the public debt jumped +8% (+$79B) to $1.03T, marking the first fiscal year above $1 trillion.

• Several categories offset growth: Education outlays fell -87% (-$233B) due to federal student loan adjustments, FDIC spending dropped -184% (-$68B) as bank resolution costs normalized, and SBA spending plunged -98% (-$32B).

• Among other areas, Veterans Affairs (+$40B, +12%), Defense (+$37B, +4%), Homeland Security (+$26B, +29%), and EPA (+$23B, +170%) saw notable increases.

• CBO noted that if not for timing shifts from the previous year, the FY2025 deficit would have been 6% smaller rather than 2% smaller, underscoring the structural improvement in federal finances.

The U.S. federal budget deficit was $1.8 trillion in FY2025 (-$8 billion YoY), while September 2025 recorded a $164 billion surplus (+$84 billion YoY), reflecting higher receipts and large education-program adjustments.

• Total revenues in FY25 were $5.23 trillion, up +$308 billion (+6% YoY). Gains were led by individual income & payroll taxes (+$260 billion, +6%) and customs duties (+$118 billion, +153%), partly offset by corporate income taxes (-$77 billion, -15%).
• Total outlays in FY25 were: $7.04 trillion, up +$301 billion (+4% YoY). Excluding timing shifts, outlays rose +$228 billion (+3%). Net interest exceeded $1 trillion for the first time (+$80 billion, +8% YoY).
• Major program drivers (FY25): Social Security +$121 billion (+8%), Medicare +$72 billion (+8%), Medicaid +$52 billion (+8%), VA +$41 billion (+12%), Defense +$38 billion (+5%), USDA +$28 billion (+14%), refundable credits +$26 billion (+13%), DHS +$25 billion (+28%), EPA +$23 billion (grant disbursements).
• Offsetting declines (FY25): Education -$234 billion (-87%) driven by -$131 billion student-loan modifications and lower program costs; FDIC -$63 billion and SBA -$32 billion also decreased.
• Timing effect: Without FY2024 timing shifts, the FY2025 deficit would have been $80 billion smaller than FY2024 (i.e., a larger YoY improvement).

• In September 2025, the budget surplus was $164 billion, more than double the surplus reported in September 2024 ($80 billion) as revenues were slightly higher and outlays considerably lower.
• Total receipts in September 2025 were $535 billion, up +$8 billion (+2% YoY). Customs duties +$22 billion (+310%), individual & payroll taxes +$31 billion (+25%), corporate taxes -$45 billion (-42%).
• Total outlays in September 2025 were $371 billion, down -$76 billion (-13% YoY), chiefly from Education -$124 billion; increases included Social Security +$10 billion (+8%), Medicare +$8 billion (+11%), net interest +$8 billion (+10%), USDA +$6 billion (+53%).
• Overall, FY2025 saw stronger revenues and higher mandatory/interest costs, with education-related adjustments narrowing the deficit slightly versus FY2024.