US deficit was $120 billion in October

The U.S. racked up a $120 billion deficit in October, the first month in fiscal 2013, the Treasury Department reported on Tuesday.

The government spent $304 billion and collected only $184 billion in revenue.

That is a fast start to the new fiscal year. By comparison, the deficit in the first month of 2012 was $98 billion.

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According to the White House, the U.S. will have a $990 billion deficit this year, down slightly from the $1.1 trillion deficit in the year that ended Sept. 30.

In projecting that amount, the White House budget office assumes that Congress will reach a deal to avoid the "fiscal cliff" of tax increases and automatic spending cuts set to hit in January. It also assumes that Congress will approve the jobs stimulus plan contained in President Obama's 2013 budget. 

The deficit has topped $1 trillion for each year of the Obama administration, more than double the amount in the last year of the Bush administration, prior to the Great Recession and Obama stimulus package. 

The Congressional Budget Office (CBO) sees a smaller deficit of $641 billion next year, assuming the fiscal cliff is allowed to occur. 

But the CBO warned on Friday that allowing those $600 billion in tax increases and spending cuts would spark a new recession, leading to a spike in the unemployment rate to 9.1 percent. 

Treasury expects the U.S. to hit its $16.39 trillion borrowing limit by the end of this calendar year. The department can use some financial wizardry to avoid exceeding the limit until 2013, however. 

Raising the debt ceiling again could provoke another huge confrontation between Obama and the House GOP.

—This article was originally posted at 2:35 p.m. and last updated at 3:22 p.m.