Weak revenue growth and accelerated spending - including an economic stimulus package that returned billions to taxpayers - will drive the federal deficit to $407 billion in the fiscal year that ends this month, more than double last year's $161 billion, congressional budget analysts reported Tuesday.

With the economy expected to remain sluggish for at least the next several months, the next president will take office facing a projected deficit of $438 billion, budget analysts predict - the largest in dollar terms in American history, exceeding the previous record of $413 billion in 2004. And that number could easily climb above $500 billion if Congress acts, as expected, in the coming months to restrain the growth of the alternative minimum tax, said budget analysts.

In January, congressional budget analysts had estimated the deficit would be only $219 billion by year's end. This summer, however, the White House estimated that that number was likely to spike to $389 billion because of new spending.

Further complicating the budget picture is this weekend's takeover by the Treasury Department of mortgage finance giants Fannie Mae and Freddie Mac. Peter Orszag, director of the Congressional Budget Office, the official scorekeeper of the nation's revenues and expenditures, announced that he plans to incorporate the companies directly into the budget when he re-examines the nation's fiscal picture in January. The two companies together hold or insure about half of the nation's 12 million residential mortgages and claimed more than $1.5 trillion in debt at the end of the second quarter.