WASHINGTON, July 13 (Reuters) - Growing refunds from President Donald Trump's illegal tariffs pushed the June federal budget deficit up to $120 billion, the U.S. Treasury Department said on Monday, marking a sharp turnaround from the $27 billion surplus in June 2025 that was due partly to his imposition of the import duties.

The Treasury reported gross customs duty collections of $23.6 billion but refunds of $49.2 billion, resulting in a net outflow of $25.6 billion for the month. Total June receipts declined by $31 billion, or 6%, to $496 billion compared to the year-earlier period.

Outlays for June were $616 billion, up $117 billion, or 23%, from the reported June 2025 total. But the Treasury said that June 2025 outlays were reduced by $97 billion due to calendar shifts in benefit payments. On an adjusted basis, the June deficit was up $53 billion, or 79%, from the prior-year adjusted deficit of $67 billion.

The Treasury's gross interest outlays for public debt in June rose $41 billion, or 28%, to $185 billion, but this figure was partially offset by a $10 billion, or 17%, increase in interest received by federal trust funds to $70 billion.

For the fiscal year to date, the deficit rose $29 billion, or 2%, to $1.367 trillion. Receipts for that period were up $143 billion, or 4%, to $4.151 trillion, while outlays rose $172 billion, or 3%, to $5.518 trillion.