The U.S. budget deficit surged nearly four times to reach $257 billion in October, influenced by several one-time factors, according to a report released by the Treasury Department on Wednesday. This month marks the beginning of a new fiscal year, leaving a substantial shortfall for President-elect Donald Trump to address when he takes office in January.
The Treasury indicated that the deficit in October represented a 287% increase from the $67 billion deficit recorded in the same month last year. However, adjustments related to the timing of benefit payments resulted in a significant reduction of that month’s deficit.
A Treasury official noted that approximately $75 billion in tax payments collected during October 2023 had been postponed due to the impact of wildfires in California and other natural disasters throughout the year.
Excluding those adjustments, the official estimated that the deficit for October 2024 would have been around $47 billion, which is 22% higher than the previous October.
Federal revenue for October fell by 19%, or $77 billion, totaling $327 billion compared to October 2023, while expenditures rose by 24%, increasing $114 billion to $584 billion.
These budget figures for October, the first month of the 2025 fiscal year, follow what turned out to be a substantial fiscal deficit of $1.83 trillion for the full year of 2024 under President Joe Biden’s administration, marking the largest shortfall outside of the pandemic period.
While spending for Social Security, Medicare, and military programs increased, there was a positive note with a decline in the Treasury’s public debt service costs by $7 billion, or 8%, down to $82 billion—this marked the first annual decrease in this cost since August 2023.
