The sea of red ink is being created by a drop in revenue and a massive increase in spending to fund efforts to deal with the coronavirus pandemic.
The Treasury Department said Tuesday that the government racked up a shortfall of $737.9 billion last month. That was more than three times larger than the previous record monthly deficit of $235 billion set in February.
The deficit so far for the fiscal year that began Oct. 1 climbed to $1.48 trillion.
Nancy Vanden Houten, lead U.S. financial economist for Oxford Economics, forecast the deficit for the entire budget year could hit $3.2 trillion or higher, depending on whether Congress passes more relief packages.
House Speaker Nancy Pelosi on Tuesday unveiled a more than $3 trillion package with nearly $1 trillion earmarked for states and cities. The proposal faces uncertain prospects in the Senate.
Treasury normally runs surpluses in April as the government revenues swell because of the annual April filing deadline for tax payments. But this year, among the many measures the government has taken to try to cushion the blow of the coronavirus shutdowns, the April 15 tax deadline has been deferred to July 15.
The Congressional Budget Office has estimated that all the spending the government has done to deal with what is expected to be a sharp recession will push the deficit for the entire year to $3.7 trillion.
That would surpass the previous record $1.4 trillion set in 2009, the first of four years in which the annual deficits climbed above $1 trillion as the government battled to pull the country out of the Great Recession.
For the first seven months of the budget year, revenues total $1.85 trillion, a drop of 9.7% from the same period a year ago. Government spending totals $3.33 trillion, an increase 29.3% from a year ago.
The deficit for the first seven months of this budget year of $1.48 trillion is 79% larger than the $530.9 billion deficit recorded for the first seven months of the last budget year.