U.S. Federal Government Deficit in September 2022

According to the U.S. Department of the Treasury the federal government ran a deficit of $431 billion in September 2022, the final month of FY2022. This deficit was the difference between $488 billion in revenues and $919 billion in spending. Receipts were up by $28 billion (6%), and outlays were up by $394 billion (63%) compared to September 2021. Timing shifts did move some payments to September that otherwise would have been paid in October (i.e., FY2023), contributing to the higher-than-expected deficit last month.

More significantly, the Biden Administration’s announcement of a continued repayment pause on and forgiveness of federal student loan payments caused September’s deficit to be much higher than forecasted. Since federal accounting rules require these changes to be a one-time charge to the government, estimated costs of $426 billion were recorded by the federal government in September. In fact, student loan forgiveness was the single largest contribution to increased federal spending – and the deficit – in September (and in FY2022 overall), accounting for $379 billion. Given the sizeable impact of these one-time policy changes, it is difficult to discern year-over-year major trends for the month of September.