The Treasury Department told Congress on Monday it must raise the $16.7 trillion national debt limit by mid-October.
Treasury Secretary Jack Lew in a letter to lawmakers said his department would exhaust the "extraordinary measures" it holds to keep the U.S. from breaching the limit at that time.
"Congress should act as soon as possible to meet its responsibility to the nation and to remove the threat of default," he wrote. "Under any circumstance — in light of the schedule, the inherent viability of cash flows, and the dire consequences of miscalculation — Congress must act before the middle of October."
Shortly after Lew's letter became public, the White House reiterated its stance on raising the debt limit — it is not up for debate.
"Let me reiterate what our position is, and it is unequivocal — we will not negotiate with Republicans in Congress over bills Congress has racked up," said White House Press Secretary Jay Carney. "We have never defaulted and we must never default."
Meanwhile, a spokesman for Speaker John Boehner (R-Ohio) fired back, saying the debt limit is "a reminder that, under President Obama, Washington has failed to deal seriously with America's debt and deficit."
Republicans have signaled an interest in joining the debate over government funding with the debate over raising the debt ceiling, which could give the party more leverage in talks with the White House.
Boehner told his conference Thursday that he wanted to advance a short-term continuing resolution to keep the government funded for one or two months. The measure would be set at the level of the sequester, which imposed automatic spending cuts on the government.
Conservative members want to use the government funding measure to defund ObamaCare, a move Boehner has not embraced.
Democrats want to replace sequester spending cuts with a mix of revenue increases.
After the release of Lew's letter, they began quickly calling for Republicans to agree to promptly hike the debt limit, citing the 2011 debt limit standoff that roiled markets and led to the first-ever downgrade of the nation's credit rating.
"Republicans must return to Congress prepared to move beyond the kind of brinksmanship that undermined our economic recovery two years ago," said Rep. Sandy Levin (D-Mich.), the ranking member of the House Ways and Means Committee. "It is time for Republicans to do the right thing – not the far right thing – and put the American economy first."
Lew said the government would have about $50 billion cash on hand in mid-October, putting the nation in an "unacceptable position" if Congress does not act to raise the debt ceiling.
He wrote that he could not predict how long that cash would last or whether the government would bring in enough money on a given day to cover bills come due.
The Treasury began employing "extraordinary measures" to free up cash to keep the nation up to date with its existing obligations in May.
Justin Sink contributed to this story.
This story was posted at 4:06 p.m. and updated at 4:53 p.m.