In 1974, Congress passed the the Congressional Budget and Impoundment Control Act, signed by President Richard Nixon, establishing a budget process and new dates for the government’s fiscal year, moves that leaders hoped would make it easier to agree on annual federal spending plans.
Almost a half century later, consensus on federal budgets is more elusive than ever, and Congress keeps passing continuing resolutions that maintain government spending at the previous fiscal year’s levels.
What is a fiscal year?
A fiscal year is an annual timeframe that companies and governments use for financial reporting and budgeting. Though the length of time is the same, the start and end dates of a fiscal year often differ from a calendar year. They are important for accounting purposes because they are used in federal tax filings and budget documents and for reporting income and expenses.
A fiscal year may be broken down into quarters. For the federal government, these quarters are:
Q1: October — December
Q2: January — March
Q3: April — June
Q4: July — September
When is the U.S. government’s fiscal year?
The federal government’s fiscal year runs from the first day of October of one calendar year through the last day of September of the next. For example, Fiscal Year 2021 (FY 2021) started on Oct.1, 2020, and ended on Sept. 30, 2021.
The current fiscal year, FY 2023, ends on Sept. 30, 2023. FY 2024 starts Oct. 1, 2023, and ends Sept. 30, 2024.
Why does the U.S. government fiscal year end on Sept. 30?
Prior to 1974, the government’s fiscal year started on July 1 and ended on June 30. The Congressional Budget and Impoundment Control Act made the change to allow Congress more time to agree upon a budget each year.
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