By Kate Davidson 

WASHINGTON -- The federal budget deficit shrank last month from a year earlier as households and businesses made tax payments that had been delayed from April, the Congressional Budget Office estimated.

The CBO on Monday said the budget gap last month totaled $61 billion, compared with $120 billion in July 2019, as revenue jumped. The Internal Revenue Service pushed back the April 15 tax-payment deadline in an effort to keep more cash in Americans' wallets in the early weeks of the coronavirus pandemic.

Tax receipts totaled $563 billion, compared with $312 billion in the same period a year earlier, which CBO attributed to the delayed payment deadlines.

But the agency noted receipts were still down 10% between April and June from a year earlier, reflecting the deep economic downturn triggered by the pandemic, which triggered widespread business closures and layoffs that have reduced tax revenue for the government.

The deficit for the first 10 months of fiscal year 2020 reached $2.8 trillion, CBO estimated, $1.9 trillion more than the deficit recorded in the same period last year. Revenues were 1% lower and outlays were 51% higher in the period.

Federal spending has soared after Congress approved trillions in economic relief measures, including enhanced unemployment benefits, stimulus checks for households and emergency small-business loans. Outlays totaled $624 billion last month, a 68% increase from the same period last year.

Write to Kate Davidson at kate.davidson@wsj.com

(END) Dow Jones Newswires

August 10, 2020 12:08 ET (16:08 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.