(Adds details on record monthly U.S. deficits)

By David Lawder

WASHINGTON, April 12 (Reuters) - The U.S. government posted a March budget deficit of $660 billion, a record high for the month, as direct payments to Americans under President Joe Biden's stimulus package were distributed, the Treasury Department said on Monday.

The deficit for the first six months of the 2021 fiscal year ballooned to a record $1.706 trillion, compared to a $743 billion deficit for the comparable year-earlier period.

The COVID-19 pandemic did not have a big impact on the first six months of fiscal 2020, as increased outlays tied to rising unemployment due to pandemic-related lockdowns and major new aid spending did not start until the very end of March 2020 and ramped up in the following month, a Treasury official told reporters.

The March 2021 deficit was the third highest U.S. monthly deficit on record, surpassed by gaps of $864 billion in June 2020 and $738 billion in April 2020.

The March deficit, which compared to a year-earlier fiscal gap of $119 billion, included receipts of $268 billion and outlays of $927 billion - both record highs for that month.

The 13% increase in March receipts was buoyed by an increase in taxes withheld from individuals, representing strong earnings among higher-paid Americans who were able to work remotely, the Treasury official said, as well as from improved overall employment levels compared to a major drop in employment in the second half of March 2020.

The March outlays were further increased by $339 billion in direct payments of $1,400 that were sent to many individuals under Biden's American Rescue Plan Act that was enacted last month, the Treasury official said.

More funding from the $1.9 trillion stimulus package will roll out in coming months, the official added, likely keeping outlays elevated.

For the first six months of fiscal 2021, outlays were a record $3.410 trillion, while receipts were $1.704 trillion, the Treasury said. Total direct payments in the six-month period came to $487 billion, including those from a year-end stimulus package passed under former President Donald Trump, the Treasury official said. (Reporting by David Lawder; Editing by Paul Simao)