Overview

• The federal shortfall for fiscal 2025 totaled about $1.775 trillion, down $41 billion, marking a roughly 2% decline and the first annual drop since 2022.
• Total receipts reached a record $5.235 trillion, helped by about $195 billion in net tariff revenue tied to President Donald Trump’s higher duties.
• Federal outlays climbed to a record $7.01 trillion, with interest costs hitting an all-time high of $1.216 trillion and ranking as the second-largest expense after Social Security.
• September posted a record $198 billion monthly surplus, boosted by a legislated $131 billion reduction to the Education Department’s budget that drove its annual outlays down 87% to $35 billion.
• Treasury staff provisionally peg the deficit at about 5.9% of GDP, roughly in line with a recent CBO estimate, and Secretary Scott Bessent said tariff revenues could reach $500 billion a year as he aims to push the deficit ratio toward the 3% range.