Current Federal Debt and Deficit
Every month, the U.S. Treasury releases data on the federal budget, including the current deficit or surplus. The following reflects budget data for January, the fourth month of fiscal year (FY) 2026.
Current Federal Deficit
$95B
Federal Budget Deficit for January FY26
$129B
Federal Budget Deficit for January FY25
The federal government reported a deficit of $95 billion in the month of January FY26, a decrease of $34 billion from the $129 billion deficit recorded in January FY25. However, February 1 fell on a weekend in both FY25 and FY26, causing certain payments, mostly Medicare-related, to be shifted into January of both years. Those timing shifts inflated outlays for the past two Januarys. Adjusting for those timing shifts, the January FY26 deficit would have been $41 billion less than the same month in the previous year.
Spending in January FY26 was $13 billion higher than in January last year, though, adjusting for the timing shifts, outlays were up $6 billion compared to the same month in FY25. Categories that saw the largest increases were Social Security ($10 billion) and Medicare ($7 billion adjusted for timing shifts). Partially offsetting those and other spending increases was a $5 billion decrease in net interest outlays. Receipts were up by $47 billion in January FY26 compared to the previous year: customs duties collections rose by $20 billion, mainly due to the increase in tariffs, and individual income tax receipts increased by $12 billion.
Cumulative Federal Deficit
$697B
Cumulative FY26 Deficit
$840B
Cumulative FY25 Deficit (through January FY25)
Four months through FY26, the deficit was $143 billion below last year’s level. However, the cumulative deficits of FY25 and FY26 have been affected by the aforementioned January 1 timing shifts. Without those effects, the cumulative deficit for FY26 would have been $152 billion less than last year’s adjusted total.
For FY26, total outlays were $2.5 trillion, $46 billion lower than the same period in the previous year. Adjusting for those timing shifts, spending was $37 billion below the same period last year. That increase was driven mainly by three categories: Social Security spending was up by $38 billion, stemming from cost-of-living adjustments and some retroactive payments; Medicare outlays increased by $28 billion (adjusted for timing shifts); and net interest rose by $24 billion. Partially offsetting those and other increases was a $20 billion decrease by the Environmental Protection Agency and a $17 billion decrease in spending related by the Department of Agriculture.
Receipts are up by $188 billion in FY26 compared to the previous year: individual income tax receipts have increased by $100 billion, and customs duties collections rose by $90 billion, largely due to the increase in tariffs.
National Debt
$30.8T
Debt Held by the Public at the end of January FY26
$28.8T
Debt Held by the Public at the end of January FY25
The FY26 deficit through the first four months is the third-largest in the last six years. The debt held by the public is approaching its post-World War II high as a percentage of gross domestic product and is rising rapidly, driven by aging demographics, rising healthcare costs, inadequate revenues, and skyrocketing interest costs. The good news is that there are many solutions available to improve our fiscal outlook and put our nation on a stronger path.