U.S. federal deficit reaches $1.246 trillion in fiscal 2026 through May

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U.S. federal deficit 2026

Highlights

The U.S. federal deficit through May in fiscal 2026 is $1.246 trillion, 8.69 percent lower than the $1.365 trillion shortfall in the same period last year.
Federal net outlays total $4.902 trillion year to date in FY2026, 1.14 percent above FY2025, with $628.161 billion spent in May alone.
Net receipts through May rise 5.00 percent year-over-year to $3.656 trillion, while outlays still outpace revenues by 34 percent for each dollar received.

May fiscal update and budget trajectory

As reported by the Joint Economic Committee, the federal government runs a deficit of $292.648 billion in May, while the cumulative deficit from the start of the fiscal year to May 2026 stands at $1.246 trillion.

That compares with a $1.365 trillion deficit in the same fiscal year-to-date period of FY2025, leaving the current shortfall 8.69 percent lower than a year earlier. For full FY2025, the deficit is $1.775 trillion, and the Congressional Budget Office projects total deficits of $1.853 trillion in FY2026, $1.887 trillion in FY2027 and $2.080 trillion in FY2028.

The committee says 25.42 percent of FY2026 outlays through May are not paid for by revenues. It adds that for every dollar the federal government receives in revenue, it spends $1.34.

Spending, revenue and fiscal outlook

Federal net outlays total $628.161 billion in May and $4.902 trillion from the start of the fiscal year through May. That year-to-date spending level is 1.14 percent higher than the comparable FY2025 period, when net outlays reach $4.846 trillion.

For the full prior fiscal year, net outlays are $7.010 trillion. The CBO's latest 10-year budget projection forecasts outlays of $7.449 trillion in FY2026, $7.772 trillion in FY2027 and $8.151 trillion in FY2028.

Net receipts total $335.512 billion in May and $3.656 trillion year to date through May. That is 5.00 percent above the comparable FY2025 period, when receipts stand at $3.482 trillion, while full-year FY2025 receipts are $5.235 trillion; the CBO projects receipts of $5.596 trillion in FY2026, $5.885 trillion in FY2027 and $6.071 trillion in FY2028.

In our earlier article on new Social Security trust fund projections, we highlighted estimates that the Old-Age and Survivors Insurance trust fund could be depleted around 2033, with the combined retirement and disability funds lasting to about 2035. We noted that, even with slightly later exhaustion dates than prior official estimates, the analysis still points to a sizable financing gap that would require higher payroll taxes, benefit adjustments, or a mix of both if policymakers do not act.

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