What does the federal government spend money on?
In FY 2023, about 58% of federal spending, or $3.6 trillion, went to Social Security, defense, and payments to states. Social Security and Medicare are two of the largest individual programs funded by the federal government. In FY 2023, 22% of the
Federal government spending pays for everything from Social Security and Medicare to military equipment, highway maintenance, building construction, research, and education. This spending can be broken down into two primary categories: mandatory and discretionary.
Your federal taxes primarily fund major health programs like Medicare and Medicaid, Social Security, and defense and security, which are the largest expenditure categories.
Major expenditure categories are healthcare, Social Security, and defense; income and payroll taxes are the primary revenue sources. During FY2022, the federal government spent $6.3 trillion. Spending as % of GDP is 25.1%, almost 2 percentage points greater than the average over the past 50 years.
What are the sources of revenue for the federal government? What are the sources of revenue for the federal government? Over half of federal revenue comes from individual income taxes, 9 percent from corporate income taxes, and another 30 percent from payroll taxes that fund social insurance programs (figure 1).
Reducing improper payments by $50 billion: Each year, the Federal Government wastes billions of American taxpayers' dollars on improper payments to individuals, organizations, and contractors.
In December 2021, debt held by the public was estimated at 96.19% of GDP, and approximately 33% of this public debt was owned by foreigners (government and private). The United States has the largest external debt in the world.
California's state budget supports an array of programs and services that touch the lives of all Californians – from schools and colleges to health care and public safety to highways and environmental protection.
Internal Revenue Code section 3401(c) indicates that an “officer, employee, or elected official” of government is an employee for income tax withholding purposes. However, in some special cases the law or a Section 218 Agreement may specify otherwise.
2022 Federal Income Tax Receipt Average Federal Income Taxes Paid in the United States April 15, 2023 Download PDF Version Inflation adjusted to 2022 dollars | |
---|---|
Health | $3,623.74 |
Food and Agriculture | $595.21 |
* Includes $389.43 for Food stamps (SNAP) |
What is the most federal spending?
Nearly half of mandatory spending in 2022 was for Social Security and other income support programs such as the Child Tax Credit, food and nutrition assistance, and federal employee benefits (figure 3). Most of the remainder paid for the two major government health programs, Medicare and Medicaid.
The Federal Income Tax was established in 1913 with the ratification of the 16th Amendment. Though barely 100 years old, individual income taxes are the largest source of tax revenue in the U.S. is the federal government's largest source of revenue.

The second biggest item in general public services was legislative services, financial & fiscal affairs and external affairs, accounting for 10,2% of total spending.
In 2023, major entitlement programs—Social Security, Medicare, Medicaid, Obamacare, and other health care programs—consumed 50 percent of all federal spending. Soon, this spending will be larger than the portion of spending for all other priorities (such as national defense) combined. What Funds the Federal Budget?
Law and Order in Jeopardy: Police departments, courts, and the justice system all rely on tax revenue. A lack of funding could lead to reduced police presence, court closures, and a rise in crime as the legal system struggles to function.
progressive tax—A tax that takes a larger percentage of income from high-income groups than from low-income groups. proportional tax—A tax that takes the same percentage of income from all income groups. regressive tax—A tax that takes a larger percentage of income from low-income groups than from high-income groups.
In FY 2023, about 58% of federal spending, or $3.6 trillion, went to Social Security, defense, and payments to states. Social Security and Medicare are two of the largest individual programs funded by the federal government. In FY 2023, 22% of the federal budget went to Social Security and 14% went to Medicare.
- Convenience Stores. Many people don't think about the markup they pay for convenience store items. ...
- Cell Phone Plans. Take the time to check your monthly cell phone bill–you may be paying more than you need to. ...
- Soft Drinks. ...
- Unnecessary Bank Fees. ...
- Magazines. ...
- Annual Credit Card Fees.
The FTCA allows individuals to sue the federal government for certain torts committed by federal employees. But, before you can file a lawsuit, you must exhaust administrative remedies. This means filing a claim with the appropriate federal agency and waiting for their response.
Ranked: Government Debt by Country
As the world's largest economy, the U.S. debt pile continues to balloon, accounting for 34.6% of the world's total government debt.
Can the US ever get out of debt?
Eliminating the U.S. government's debt is a Herculean task that could take decades. In addition to obvious steps, such as hiking taxes and slashing spending, the government could take a number of other approaches, some of them unorthodox and even controversial.
The fact is that Congress, despite borrowing $2.9 trillion from Social Security, hasn't pilfered or misappropriated a red cent from the program. Regardless of whether Social Security was presented as a unified budget under Lyndon B.
Most of the government's federal income tax revenue comes from the nation's top income earners. In 2021, the top 5% of earners — people with incomes $252,840 and above — collectively paid over $1.4 trillion in income taxes, or about 66% of the national total.
Mandatory Spending
It is dominated by the Social Security and Medicare programs, which provide income security and health insurance for retirees and some Americans with disabilities, and sometimes their families.
View the PDF version of this Fact Sheet. Governor Newsom's proposed 2019-20 state budget includes $12.7 billion for state corrections. [1] The largest share of this proposed spending (55.5%, or $7.1 billion) goes to state prison operations.