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1Clear out junk files and repair common Windows errors2Scan for outdated or missing drivers - takes under a minute3Repair Windows errors before they cause bigger problemsIn fiscal year 2025, the federal government ran a $1.8 trillion deficit, and net interest on federal debt cost $970 billion, according to the Congressional Budget Office (CBO). Social Security and Medicare together accounted for more than one-third of federal spending and exceeded discretionary spending combined. These are fiscal-year results, not calendar-year totals: FY2025 ran from October 1, 2024, through September 30, 2025.
How to read a federal budget breakdown
A federal budget can be organized in several ways. The broadest spending view separates outlays into mandatory spending, discretionary spending, and net interest. Other tables group spending by function—such as health or national defense—or by agency. Those views answer different questions and should not be treated as interchangeable.
Also distinguish dollars authorized from dollars paid. Budget authority is legal permission for agencies or programs to incur obligations. Outlays are the payments the government actually makes. Because payments can follow obligations made earlier, discretionary outlays in a fiscal year do not necessarily match that year’s new appropriations. The CBO explains this distinction in its baseline projections methodology.
What the three main spending categories mean
Mandatory spending
Mandatory spending is governed by laws that set eligibility and benefit rules, rather than being funded through a new annual appropriation for every dollar. Social Security, Medicare, and veterans benefits are examples. Spending can change as the number of eligible people, program use, and statutory rules change.
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Discretionary spending
Discretionary spending is funded through annual congressional appropriations for federal agencies and activities. Appropriations provide budget authority; the resulting outlays may occur in the same year or later, depending on when obligations are made and payments come due.
Net interest
Net interest is the government’s interest cost after relevant interest income and other earnings are offset. It is not the same measure as gross interest payments. CBO’s net-interest figure includes costs associated with debt held by the public, including Treasury securities.
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What the FY2025 results show
CBO’s March 30, 2026 account of FY2025 results reports a deficit of $1.8 trillion, equal to 5.8% of gross domestic product (GDP). The deficit share was above the 50-year average of 3.8% of GDP, according to CBO. The deficit is the gap between federal receipts and outlays.
Net interest cost $970 billion in FY2025, or 3.2% of GDP. CBO said that share was more than twice the 2021 share. Social Security and Medicare together represented more than one-third of all federal spending and, combined, eclipsed discretionary spending.
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Clear out junk files and repair common Windows errorsFree Scan →Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →CBO also described federal revenues as a share of GDP as slightly above the average over the prior 20 years. That is a comparison of revenue relative to the size of the economy, not a published dollar total in the summary figures cited here.
Why different FY2025 deficit figures may appear
A number’s status and publication date matter. In February 2025, CBO projected a $1.9 trillion deficit for FY2025. Its March 2026 release reported $1.8 trillion for FY2025 results. The former is an earlier projection; the latter is CBO’s account of the completed fiscal year. They are not contradictory measurements of the same status at the same point in time.
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When comparing budget figures, check whether each is an actual result, estimate, projection, or proposal, and whether it refers to outlays or budget authority. A proposal describes a plan, not what the government ultimately collected or paid.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Where to find exact receipts and category totals
The CBO summary figures above establish the overall deficit, net interest, and the relative scale of Social Security and Medicare, but they do not provide a full FY2025 line-item breakdown of receipts or functional spending. For exact amounts, use the relevant year and status in the Office of Management and Budget’s Historical Tables. The catalog includes separate tables for receipts by source, outlays by function and subfunction, outlays by agency, debt, and budget authority.
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Before comparing two numbers, verify that both use the same basis: actual outlays versus budget authority, nominal dollars versus share of GDP, and function versus agency. Also check the fiscal year and publication vintage; timing shifts and revised projections can change how a figure should be interpreted.
Fiscal year versus calendar year
The federal fiscal year begins October 1 and ends September 30. FY2025 therefore covers October 1, 2024, through September 30, 2025, rather than January through December 2025. Federal budget figures should be labeled by fiscal year to avoid mixing them with calendar-year income, tax, or economic data.
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