Debt Ceiling
The federal debt limit, also called the debt ceiling, is the statutory cap on how much the Treasury may borrow. Treasury borrowing finances federal operations and existing legal obligations; debt subject to the limit includes debt held by the public and debt issued to federal government accounts.
The federal debt limit, also called the debt ceiling, is the statutory cap on how much the Treasury may borrow. Treasury borrowing finances federal operations and existing legal obligations; debt subject to the limit includes debt held by the public and debt issued to federal government accounts.
Example: In July 2025, P.L. 119-21 increased the debt limit by $5.0 trillion, to $41.1 trillion.
Common misconception: Raising the debt limit does not itself authorize new spending commitments. It allows Treasury to borrow to finance existing legal obligations.
Sources: U.S. Department of the Treasury, Debt Limit; CRS, The Debt Limit