Federal Deficit $1 TRILLION in first 9 months of 2010 Fiscal Year

Congressional Budget Office Report
July 7, 2010

The federal government incurred a deficit of just over $1.0 trillion for the first nine months of fiscal year 2010, CBO estimates, $81 billion less than the roughly $1.1 trillion deficit incurred through June 2009. Revenues so far this year are slightly higher than they were last year at this time; outlays are about 3 percent lower.

Outlays were $11 billion higher in June than in the same month last year, CBO estimates. Outlays for the Troubled Asset Relief Program (TARP) and Fannie Mae and Freddie Mac were, in total, about $19 billion lower this June than in June 2009—but other spending was up by about $30 billion. Outlays increased by $5 billion for the Federal Deposit Insurance Corporation and by $3 billion each for defense and for health programs. Spending for Social Security benefits and veterans’ programs increased by $2 billion each. In addition, the National Railroad Retirement Investment Trust lost more than $1 billion on its investment portfolio in June 2010; a year ago, it earned about $1 billion.

The Treasury reported a deficit of $136 billion for May, about $6 billion less than CBO had projected on the basis of the Daily Treasury Statements. That difference occurred largely because spending was lower than expected for health, veterans’, and homeland security programs.

The deficit in June was $69 billion, CBO estimates, $25 billion less than the shortfall recorded a year ago. CBO estimates that receipts in June were $36 billion (or 17 percent) higher than collections in June 2009. More than half of that difference stemmed from an increase of $19 billion (or almost 60 percent) in net receipts from corporate income taxes. Gross receipts from those taxes rose by $15 billion (or 37 percent), primarily because of higher estimated payments for the current year; a $4 billion decline in corporate income tax refunds also bolstered net corporate receipts. Link to CBO report