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U.S. Budget and Government Spending: Budget Terms to Know

Resources on the U.S. Budget and Federal spending.

Key Budget Terms

The below terms come up the most in government budgeting.  Knowing these terms will help you understand the federal budget.

  • Appropriations- Act of Congress that allows a federal entity to incur obligations and make payments from the Treasury Department, usually for a set period of time.
  • Authorization- Act of Congress that establishes or continues a federal program.
  • Budget Receipts- Money collected from the public, including taxes, court fines, certain licence fees, etc.
  • Expenditure- The amount of money actually spent. Expenditures rarely match the actual appropriations for the specific year since some expenditures can include money allocated from previous years' budgets.
  • Deficit- The amount where outlays exceed budget receipts.
  • Fiscal Year- The accounting year the budget covers. The federal fiscal year starts on October 1 and ends on September 30.
  • Obligation- Binding agreement to pay for goods/services/studies/products, etc.
  • Outlay- Liquidation or disbursement of cash for an obligation.
  • Sequestration- A procedure to cancel funding within the budget, usually because of spending limits. Money that has been sequestrated cannot be used for obligations or outlays.
  • Surplus- The amount where budget receipts exceed outlays.
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