The U.S. government posted a $262 billion budget deficit in February, up 21% from a year earlier, as outlays grew and revenues fell, due largely to higher tax refunds issued as the Internal Revenue Service worked through a substantial backlog of unprocessed returns.

For the first five months of the 2023 fiscal year that started Oct. 1, the Treasury said the cumulative deficit came to $723 billion, up $247 billion, or 52%, from the comparable period of fiscal 2022, when the deficit was $476 billion.

The Treasury Department said Friday the deficit last month compared to a $217 billion budget gap in February 2022.

Receipts for the month fell $28 billion, or 10%, to $262 billion, while outlays grew $18 billion, or 4%, to $525 billion.

The Treasury said individual withheld tax receipts in February climbed $10 billion, or 4%, compared to a year ago, but individual tax refunds, which reduce revenues, grew $31 billion, or 153%, to a total of $52 billion.

A Treasury official said most of the tax refunds issued during February were from backlogged returns that had piled up during the COVID-19 pandemic but are now being processed by the IRS.

Year-to-date receipts fell 4% to $1.735 trillion, while outlays grew 8% to $2.458 trillion.

The biggest drivers of deficits this year, according to Treasury data, have been interest on the public debt, which is up $69 billion, or 29%; higher individual tax refunds, also up $69 billion, or 136%; lower federal reserve earnings, down $47 billion, or 99%; and higher Social Security costs, up $45 billion, or 9%.