It said it would pay down $35 billion in net marketable debt in the April-June quarter, and would likely end the quarter with a cash balance of $75 billion. In February, it estimated that it would need to borrow $103 billion, even as it projected a smaller end-of-quarter cash balance.
It is the first retirement of government debt since a $145 billion paydown in the April-June 2007 quarter.
The Treasury also said it expects to issue $223 billion in net marketable debt for the July-September quarter and end the quarter with a cash balance of $80 billion.
The Treasury said it issued $349 billion in net marketable debt securities in the January-March 2013 quarter.
A decrease in the supply of government debt has forced some money fund managers and cash investors to scramble for alternatives. Higher demand for commercial paper, repurchase agreements and other short-term private debt has knocked down borrowing costs on Wall Street.
The Treasury has sharply reduced its issuance of bills in the past couple of weeks, and analysts said further reductions are likely this quarter given the bigger-than-expected tax receipts.
They said, however, that the Treasury was unlikely to scale back monthly offerings of longer-dated debt.
"It's not going to persist through the end of the year," Nancy Vanden Houten, an analyst at Stone & McCarthy Research Associates in Princeton, New Jersey, said of the unexpectedly large surge in receipts. Tax receipts tend to be "quite volatile this time of the year."