The U.S. January budget deficit widened to $49.80 billion, the second-largest deficit on record for the month, a government report underscoring the sea of U.S. government red ink showed on Thursday.

The deficit for the fiscal year to date narrowed to $419 billion from $431 billion, but the gap is expected to widen as the effects of payroll and business tax cuts kick in.

(Editing by James Dalgleish)