Washington — The federal government could be unable to pay its bills as soon as August if Congress doesn’t act, the Congressional Budget Office estimated Wednesday.
“The Congressional Budget Office estimates that if the debt limit remains unchanged, the government’s ability to borrow using extraordinary measures will probably be exhausted in August or September 2025,” the nonpartisan budget office said Wednesday.
The so-called “X-date” marks when the government could run out of borrowing power and face an unprecedented default without action from Congress to address the debt limit, which caps how much the Treasury can borrow to pay the government’s obligations. The department is currently utilizing so-called “extraordinary measures” to delay a default for several months.
The CBO analysis noted that if the government’s borrowing needs are “significantly greater” than projections, the Treasury Department’s resources could be exhausted as early as late May or June.
The debt ceiling was last addressed in 2023, when Congress suspended it until Jan. 1, 2025, under the Fiscal Responsibility Act. Since January, the Treasury Department has been using “extraordinary measures” to pay its bills and extend the date when it will run out of money. Raising the debt limit doesn’t greenlight new spending, but allows the government to pay what it already owes. The U.S. national debt currently stands at more than $36 trillion.
The CBO estimate came after the Bipartisan Policy Center projected on Monday that the U.S. could default on its debt between July and October without congressional intervention. The Treasury Department is also expected to release a projected X-date in the coming weeks.
Meanwhile, congressional leaders have weighed how to address the issue. Last month, the House included a provision that would raise the debt ceiling by $4 trillion in its budget proposal, which serves as a blueprint for implementing President Trump’s agenda. But the Senate has been pursuing a different budget measure that does not include a debt limit increase.
In recent days, Republicans in Congress have been working to reconcile the two approaches as they look to make headway on the complicated process to implement the president’s agenda. House Speaker Mike Johnson and Senate Majority Leader John Thune met Tuesday afternoon with top tax leaders as they work to unite behind a plan on the path forward. And Thune told reporters he’s hopeful lawmakers will be able to address the debt limit as part of the budget process.
