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The nomination was reported earlier by The Washington Post.

Ms. Young, who was confirmed by the Senate in March to serve as the office’s deputy, 63 to 37, previously was staff director for the House Appropriations Committee, where she played key roles in shaping annual spending bills and a series of five pandemic relief packages that totaled $3 trillion — a centerpiece of the federal government’s emergency response to the pandemic.

While she won over both Democrats and Republicans during her work on Capitol Hill, some Republicans criticized her remarks during her confirmation hearing to serve as deputy budget director. Senator Rob Portman, Republican of Ohio, questioned her position to remove the so-called Hyde amendment, which prohibits federal funds from going toward most abortions, from federal spending bills.

Thirteen Republicans supported appointing her to the deputy position in March, however, and during her confirmation hearing, Ms. Young was introduced by Senator Bill Cassidy, Republican of Louisiana. Ms. Young, a Louisiana native, came to Washington two decades ago through a fellowship program for young people interested in public service and joined the House Appropriations Committee in 2007.

She would play a leading role in formulating the administration’s economic plans, including the social policy package, a sprawling bill Democrats are seeking to push through Congress that would aim to curb climate change, fight poverty and invest in children, workers and families. The office is also instrumental in shaping the budgets for each federal agency.

The failed nomination of Ms. Tanden, a former senior adviser to Hillary Clinton’s 2016 presidential campaign, was one of the early political miscalculations for the Biden administration. The White House nominated her before Democrats won control of the Senate, despite the well-known criticism from some Democratic and Republican lawmakers of her tweets and work at the Center for American Progress, a liberal think tank.