The Congressional Budget Office (CBO) released its estimate for the US budget deficit. According to the CBO, the US government spent a record $1.4 trillion more than it collected in the fiscal year 2009 (FY 2009) which ended September 30th. That amounts to 9.9 percent of the US Gross Domestic Product. Driving the deficit were a combination of exceptional spending items, primarily bank bailouts and the fiscal stimulus coupled with a a 16.6 percent drop in revenues. Overall spending increased 17.8 percent to $3.5 trillion but the government only took in $2.1 trillion in FY 2009.

More from the New York Times:

The U.S. government spent a record $1.4 trillion more than it collected in the fiscal year ended September 30, congressional analysts said on Wednesday, in their final estimate before the official numbers are issued.

Bank bailouts, stimulus spending and declining tax revenues due to a deep recession led the government to post a deficit that amounts to 9.9 percent of the U.S. Gross Domestic Product for the 2009 fiscal year, the Congressional Budget Office said.

The Treasury Department will report the actual deficit later this month. The deficit for fiscal 2008 was $459 billion.

The $1.4 trillion estimate is less than the budget office's estimate of $1.58 trillion issued in August, but the discrepancy arises from differences in calculating the costs of bailing out mortgage giants Fannie Mae and Freddie Mac, not any sudden change in economic conditions, CBO said.

The government took in $2.1 trillion in fiscal 2009, a 16.6 percent drop from the previous year as the recession led to sharp declines in individual and corporate income taxes, CBO said.

On the other half of the ledger, outlays increased 17.8 percent to $3.5 trillion, CBO said.

Among the most expensive items were $154 billion for bailouts under the Troubled Asset Relief Program, $91 billion for the Fannie and Freddie bailouts, and $100 billion under the massive stimulus package approved in February.

Excluding items in the stimulus package, spending for unemployment benefits more than doubled to $120 billion, CBO said.

The trick the Administration must pull off is reigniting the revenue stream. The numbers could hardly be more stark: tax receipts fell off nearly 17 percent making FY 2009 the biggest  single-year decline since 1932. Individual income tax receipts are down 22 percent from a year ago. Corporate income taxes are down 57 percent. Social Security tax receipts could drop for only the second time since 1940, and Medicare taxes are on pace to drop for only the third time ever. The sheer magnitude of the tax decline points to a lingering and deep recession that is reducing incomes and eroding corporate profits.