U.S. records $113B surplus

WASHINGTON - The U.S. government reported a rare surplus of $113 billion for April - the largest in five years and a sign of the nation's improving finances.

Steady economic growth and higher tax rates have boosted the tax revenue in recent months, keeping this year's annual budget deficit on pace to be the smallest since 2008. A smaller deficit is also likely to give negotiators more time to work out a deal on raising the nation's borrowing limit.

Through the first seven months of the budget year, the deficit was $488 billion, according to the Treasury. That's lower than last year's deficit of $720 billion over the same period.

Even with the improvement, the deficit for the full year will still be quite large: the Congressional Budget Office expects it will reach $845 billion when the budget year ends Sept. 30. While that would be the first annual deficit below $1 trillion since 2008, it would still be the fifth-largest deficit in U.S. history.

The federal deficit represents the annual difference between the government's spending and the tax revenues it takes in. Each deficit contributes to the national debt, which recently topped $16 trillion.