The US government recorded a $284 billion budget deficit in October, the first month of the 2026 fiscal year, according to Treasury Department data released Tuesday.
The report was delayed by a 43-day federal government shutdown, which distorted the figures by shifting some payments into and out of the month.
The deficit rose 10% from the $257 billion shortfall in October 2024, largely due to the early disbursement of about $105 billion in benefit payments normally issued in November for certain military and healthcare programs.
After adjusting for these timing shifts, the Treasury estimated the October deficit would have been closer to $180 billion, roughly 29% lower than the adjusted deficit a year earlier.
Total outlays reached $689 billion, an 18% increase from October 2024, inflated by the shifted November payments. The Treasury said shutdown-related delays to other agency spending slightly reduced outlays, though by less than 5%. Under US law, salaries and obligations suspended during a shutdown must be paid retroactively.
Receipts surged to $404 billion, the highest ever recorded for October and a 24% increase from the same month last year. A key driver was $80 billion in non-withheld individual income tax payments, up 75% year over year, partly reflecting delayed filings from California residents affected by wildfires.
Customs duties climbed to a record $31.4 billion, driven by new import tariffs imposed by President Donald Trump since returning to office in January. The figure exceeded the previous monthly high of $29.7 billion in September and was more than four times the $7.3 billion collected in October 2024.
Trump said Monday that tariff revenues would continue to rise as US businesses run down pre-tariff inventories and resume imports at higher tariff-adjusted costs. His comments came as the US Supreme Court reviews the legality of tariffs imposed under emergency authorities.
The Congressional Budget Office reported last week that tariff reductions negotiated through new US trade agreements have cut its 10-year estimate of deficit reduction from Trump-era tariffs by 25%, lowering the projected impact to $3 trillion from $4 trillion.
Overall, the October budget data reflects an economy balancing elevated inflows from tariffs and tax receipts against the lingering effects of a prolonged government shutdown that delayed federal operations and payments across multiple agencies.
