UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549
                                FORM 10-K

              Annual Report Pursuant to Section 13 or 15(d) of
                    the Securities Exchange Act of 1934



For the fiscal year ended December 31, 1999          Commission File No. 2-95011


              Wellesley Lease Income Limited Partnership III-D
              ------------------------------------------------
           (Exact Name of Registrant as Specified in its Charter)


Massachusetts                                                         04-2850823
--------------------------------------------------------------------------------
(State or other jurisdiction                   (IRS Employer Identification No.)
of incorporation or organization)

77 Franklin Street, 4th Floor, Boston, MA                                  02110
--------------------------------------------------------------------------------
(Address of principal executive offices)                              (Zip Code)

Registrant's telephone number, including area code                (617) 482-8000

Securities registered pursuant
to Section 12(b) of the Act                                                 None


Securities registered pursuant
to Section 12(g) of the Act                                     Units of Limited
                                                           Partnership Interests

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceeding 12 months (or for such shorter period that the registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements for the past 90 days.


                         Yes    X         No
                               ---             ---

State the aggregate market value of the voting stock held by  non-affiliates  of
the registrant as of March 31, 2000:  Not applicable, since  securities are non-
voting.

                     Documents incorporated by reference:    None.

                              Exhibit Index on Page:   35

                                      Page 1 of 36




Corporate organization as discussed in Part I, Item 1. Business. is as follows:

TLP Holding LLC  ("Holding")  controls  TLP Leasing Programs, Inc. ("TLP"),  TLP
Management  Services, Inc. ("TLPMS"), and TLP Securities, Inc.  TLP controls TLP
Columbia Management Corp.  ("TCMC")  which  serves  as  General  Partner  to the
Columbia Lease Income Funds.  Torchmark Corporation ("Torchmark") controls  TMK/
United, Inc. which controls Waddell and Reed Financial Services,  Inc. ("Waddell
and Reed").

Through  various  dealer-manager  arrangements, TLP, TLPMS, and Waddell and Reed
serve as  corporate  general  partners  to  the  Wellesley  Leasing  Partnership
("Wellesley  General  Partner").  The  Wellesley  General Partner is the general
partner for the Wellesley Lease Income Limited Partnership.


                                    Part I

Item 1. Business.

Wellesley Lease Income  Limited  Partnership  III-D  (the  "Partnership")  is  a
limited  partnership organized under the provisions of the Massachusetts Uniform
Limited Partnership Act  on  December  18, 1984.   As  of December 31, 1999, the
Partnership consisted of a General Partner  and  1,910  Limited  Partners owning
20,185 Units of Limited Partnership Interests of $500 each (the "Units"), except
that  employees  of  the  Corporate General  Partners of the General Partner and
employees  and  securities representatives of its affiliates purchased 334 Units
for a net price of $460 per Unit, and the Partnership  incurred no obligation to
pay any  sales  commissions  with  respect  to  such sales.  The Units were sold
commencing  March  19,  1985,  pursuant  to a Registration Statement on Form S-1
under the Securities Act of 1933.  As set forth more fully at Item 10. Directors
and  Executive  Officers of the Partnership. of this report, the General Partner
is Wellesley  Leasing  Partnership,  and the General Partner has three Corporate
General Partners (the "Corporate General  Partners"): TLP Leasing Programs, Inc.
("TLP")   and   TLP Management  Services  Corporation  ("TLPMS"),  formerly  CIS
Management Services  Corporation  ("CISMS"), both Massachusetts corporations and
Waddell &  Reed  Financial  Services,  Inc.  ("Waddell  &  Reed",  formerly  TUP
Services, Inc. "TUPS"), a Missouri corporation.

The Partnership was organized to engage in the  business  of  acquiring  income-
producing  computer  peripheral  equipment   for   investment   purposes.    The
Partnership's principal objectives are as follows:

1.   To acquire and lease equipment,  primarily  through  operating  leases,  to
     generate income during its entire useful life;

2.   To  provide  quarterly  distributions  of cash to the Limited Partners from
     leasing revenues and from the proceeds of  sales  or  other  disposition of
     Partnership equipment; and

3.   To reinvest  a  portion of lease revenues and a substantial portion of cash
     from sales and  refinancings  in additional equipment during the first nine
     years of the Partnership's operations.

The Partnership was formed primarily for investment purposes and not  as a  "tax
shelter".

The Partnership shall terminate on December 31, 2012,  unless  sooner  dissolved
or terminated as provided in Section 11 of  the  Amended  Agreement  of  Limited
Partnership.

The closing date of the Partnership was April 25, 1986, and aggregate  equipment
purchased through December 31, 1999, is $31,576,015.   At the end of 1999, there
are  14  leases  in  place  with 9 lessees.  The acquisition of these leases and
equipment is described more  fully  in Item  2.  Properties.  of this report and
notes  3  and  4 to the financial  statements  included  in  Item  8.  Financial
Statements and Supplementary Data.

On  January  9,  1996, TLP Holding LLC purchased all the common stock of TLP and
TLPMS  from  CMI  Holding  Co. and CMI Corporation, respectively.  Under the new
ownership, TLP and TLPMS will continue to operate in the same manner of business
as described below.


Under  the   Partnership  Agreement,  the  General  Partner,  Wellesley  Leasing
Partnership, is solely  responsible for the operation of the Partnership and its
equipment.  As discussed  above, the General Partner has three Corporate General
Partners:  TLP, TLPMS  and  Waddell & Reed.  TLP was formed in December 1982 and
is a wholly-owned  subsidiary  of TLP Holding LLC ("Holding").  TLPMS was formed
in May 1985 as CISMS, and  is  a  wholly-owned  subsidiary  of  Holding  and  an
affiliate of TLP.  Holding is  primarily  engaged  in  management  services  and
equipment leasing.  Waddell & Reed (formerly TUPS) was formed in May 1986 and is
an affiliate of  Waddell & Reed, Inc.,  which  was one of the Soliciting Brokers
for this offering.  Both Waddell & Reed and Waddell &  Reed,  Inc.  are  wholly-
owned subsidiaries of TMK/United Inc., which itself  is  an  indirect  85% owned
subsidiary of Torchmark Corporation ("Torchmark").

The  General   Partnership   Agreement  between  TLP  and  TLPMS  (the  "General
Partnership Agreement"), provides that  TLPMS  will  propose  to the Partnership
equipment acquisitions, leasing, financing  and  re-financing  transactions, and
sale transactions,  for  approval  by  the Executive Committee, and will oversee
the operation, management and use of  the  Partnership's equipment, and that TLP
will oversee the marketing of the  Units and all administrative functions of the
Partnership and, together with Waddell &  Reed, will supply substantially all of
the General Partner's capital resources.   All of  the Partnership's equpment to
date has been acquired,  and all dispositions of Partnership equipment have been
made, through TLPMS,  using  the  personnel and resources of Holding and several
outside  equipment lease brokers the General  Partner  believes  would  be  most
advantageous for the Partnership.

The Partnership's investment policy provides for the acquisition of  diversified
types of computer equpment and the leasing  of  such  equipment  to  others on a
short-term basis  under  operating  leases.  The Partnership generally purchases
equipment  for  which  a  lease  exists,  or  is entered into at the time of the
Partnership's  acquisition of the equipment.  This  equipment  is  recorded  and
depreciated  at  the Partnership cost (purchase price plus the acquisition fee).
If at any time the General Partner deems the equipment to be obsolete or related
maintenance and storage  costs  to  be  in  excess of its fair market value, the
equipment is scrapped or sold at the  current  fair  market value, which ever is
most advantageous for the Partnership.

Pursuant to its leasing policies, the General Partner performs a credit analysis
of  potential  lessees to determine their creditworthiness.  The General Partner
leases all of its equipment to third parties by means of operating  leases  with
fixed base lease rates.  Rents  are  payable  monthly  or  quarterly.  Operating
leases  generally  do not have terms greater than five years in duration and the
aggregate noncancelable  rental  payments during the term of the lease (on a net
present value basis), are not sufficient  to  permit  the  lessor to recover the
purchase price of the equipment.

At the termination of the lease, the General Partner arranges for the  equipment
to be re-leased (either to the same lessee or a new  lessee)  if  it  determines
that re-leasing is in the Partnership's best interests.  Generally, equipment is
is re-leased at least once and possibly  several  times during the Partnership's
life, unless  it  is  determined  that  the  equipment  is  not  marketable  and
therefore  may  be  sold.   The  General  Partner  provides, or arranges for the
installation,   removal,  maintenance  and  modification  of  the  Partnership's
equipment.  Also, the General Partner will purchase and maintain, or cause to be
purchased  and   maintained,  appropriate  insurance  coverage  to  protect  the
interests of the Partnership.

Of the leases in place at  December  31, 1999,  the  Partnership  owned  various
computer equipment with  an  original cost basis of $1,002,046.  Listed below is
a breakdown of the various types of computer equipment owned:

          Computer            $   161,962
          Peripherals             380,952
          Other                   459,132
                              -----------
                              $ 1,002,046
                              ===========

Of the leases in place at December 31, 1999, the average lease term is 29 months
and the average monthly lease rate as a percentage of original equipment cost is
2.74%.

The Partnership's investments in computer  peripheral  equipment  are  and  will
continue to be subject to  various  risk  factors.   The principal business risk
associated with ownership of the  equipment  is  the  inability to keep it fully
leased at rentals which, after payment of operating expenses and debt service on
Partnership borrowings, provide, together with any anticipated sales proceeds or
salvage value, an acceptable rate of return.  Other risk factors include:

1.   Technological  and economic equipment obsolescence, physical deterioration,
     malfunction,  and  risks  attendant  upon  defaults  by  lessees and credit
     losses.

2.   Residual Values of Equipment.  The Partnership's return on  its  investment
     in  equipment  will  depend  in  part  upon  the  continuing  value of such
     equipment which in turn, depends upon, among other things:  (1) the quality
     of the equipment; (2) the condition of the equipment; (3) the timing of the
     equipment's  acquisition; (4) the cost of comparable new equipment; (5) the
     technological  obsolescence  of  the  equipment;  (6) the General Partner's
     ability to forecast technological changes which may reduce the value of the
     equipment; and (7) market factors.

3.   Competition from Full Payout Lessors.  In connection with operating leases,
     the Partnership will encounter considerable competition from those offering
     full payout leases, which are written for a longer term and  a  lower  rate
     than the Partnership's operating leases.

4.   Competition from Manufacturers.  Leases offered  by  the  Partnership  will
     compete with operating leases and  full  payout leases offered by equipment
     manufacturers  in  their  own  lease  programs.  In addition to  attractive
     financial terms, manufacturers may also provide certain ancillary  services
     which the Partnership cannot offer directly,  such  as  maintenance service
     (including possible equipment substitution  rights),  warranty services and
     trade-in privileges.

5.   Other Competition.  There are numerous other potential investors, including
     limited partnerships organized and managed similarly  to  the  Partnership,
     seeking to purchase equipment  subject  to  either operating leases or full
     payout leases, many of which will have greater financial resources than the
     Partnership and more  experience than the General Partner.  The Partnership
     will   compete   in   the   computer   leasing   marketplace   with    many
     non-manufacturing firms, including other  equipment  dealers,  brokers  and
     leasing companies, as well as with financial institutions.

6.   Defaults by Lessees.  Default  by  a  lessee  may  cause  equipment  to  be
     returned  to  the  Partnership  at  a  time when the General Partner may be
     unable  to  promptly  arrange  for  its  re-leasing  (at  the  rental  rate
     previously received or otherwise)  or sale  (with or without a loss),  thus
     resulting in the loss of anticipated  revenues and the inability to recover
     the Partnership's investment and repay  related debt.  Any related debt may
     be   secured  by  the  returned  equipment  and,  in  some  cases,  by  the
     Partnership's other equipment.  If the debt is not paid in a timely manner,
     the lender may foreclose and assume ownership of all equipment securing the
     debt, resulting  in  economic  loss  and  adverse  tax  consequences to the
     Partnership's partners.  Four lessees, American Hard  Cider,  Incorporated,
     FaxNet, Incorporated, The Internet Access Company,  Incorporated,  and  VIP
     Calling, Incorporated, lease equipment  in  excess  of  10% of total rental
     income for the year ended  December  31, 1999.  The related rental payments
     comprise 20.55%,  11.59%,  33.35%,  and 10.73%,  respectively, of the total
     rental  income  for  the  year  ended  December  31,  1999.   Five lessees,
     American Hard Cider, Incorporated,  FaxNet, Incorporated,  Hughes Aircraft,
     Incorporated,  The Internet Access Company, Incorporated,  and VIP Calling,
     Incorporated,  lease  equipment  comprising 21.33%, 26.17%, 14.91%, 11.21%,
     and 10.65%, respectively, of the total equipment portfolio  at December 31,
     1999.

7.   Changes in Technology.  The General Partner intends to offer lease rates to
     the Partnership's lessees which take into account the risk of technological
     advances which may  reduce  the  value  of  such  equipment  owned  by  the
     Partnership.  However, the introduction of an entirely new technology could
     lead to a  radical  reduction in the fair market value of certain equipment
     and make such equipment difficult to re-lease.

<PAGE>

Item 2.  Properties.

At  December  31,  1999,   the  Partnership  owned  computer  equipment  with  a
depreciated  cost  basis of $208,553.   All purchases of  computer equipment are
subject to a 3% acquisition fee paid to the General Partner.

<PAGE>

Item 3.  Legal Proceedings:

There are no material pending legal proceedings that the Partnership is a  party
or of which any of its equipment or leases is the subject.

On January 9, 1996, TLP Holding LLC purchased all the common stock of  TLP  from
CMI Holding Co. and all the common stock of TLP Management Services  Corporation
("TLPMS",  formerly  CIS  Management  Services  Corporation  "CISMS")  from  CMI
Corporation.   Under  the  new ownership, it is expected that TLP and TLPMS will
continue to operate in the same manner of business as each has in the past.

On  January 13, 1989  (the  "Petition Date"),  Continental  Information  Systems
Corporation  ("Continental"),  CIS  Corporation  ("CIS"),  CMI Holding Co. ("CMI
Holding"), CMI Corporation ("CMI") and certain of its affiliates  (collectively,
the "Debtors"), voluntarily petitioned for relief under Chapter 11 of the United
States   Bankruptcy   Code  ("Chapter 11"),  and  thereafter  continued  in  the
management  and  operation  of  their  businesses  and  property  as  Debtors In
Possession  until October 25, 1989, when the United States Bankruptcy Court (the
"Court") confirmed the appointment of James P. Hassett  as  Chapter  11  trustee
(the "Trustee") of the Debtors.  CMI Holding is the former parent of TLP and CMI
is the former  parent  of  TLPMS.   TLP and TLPMS,  neither of which filed under
Chapter  11,  are  the  two  Corporate  General  Partners  of  Wellesley Leasing
Partnership, the General Partner of the Partnership.  Both before and after  the
Petition Date, CIS and CMI have acted as agents for the Partnership in  selling,
leasing and remarketing Partnership equipment.  CMI  Holding  became  a  wholly-
owned subsidiary of CIS pursuant to a Court ordered settlement on July 20, 1993.

As of the Petition Date, there were a number of unsettled transactions   between
CIS  and  CMI  and  the  Partnership  and  other  affiliated  partnerships  (the
Partnership  and  such other partnerships are herein collectively referred to as
the "Partnerships"),  including  outstanding  accounts  receivable  and accounts
payable between each of the Partnerships and CIS and CMI and  their  affiliates,
sales of equipment  and  related  leases  from  CIS  and  CMI  to  each  of  the
Partnerships  for  which  not  all  documentation  had  been completed as of the
Petition Date, and sales of equipment  and  related  leases  from  which CIS had
failed to remove prior  third-party liens.  In addition, accounts receivable and
accounts   payable  continued  to  accrue  and  be  paid  between  each  of  the
Partnerships and CIS and CMI and their affiliates  subsequent  to  the  Petition
Date.

On February 28, 1992, the Court granted an order implementing  a  settlement  of
the outstanding issues between each of the Partnerships  and  the  Debtors.  The
settlement occurred on March 13, 1992. In the order the Court approved a set-off
on a partnership-by-partnership basis  of  pre-petition  amounts  owed  by  each
affected Debtor to each Partnership  to  the extent of pre-petition amounts owed
by that Partnership to that Debtor.  The  Partnership was  a net creditor to the
Debtors and paid in full its amounts owing them.

On November 29, 1994, the Court confirmed the Trustee's proposed Joint  Plan  of
Reorganization dated October 4, 1994, and the Debtors  emerged  from  Chapter 11
bankruptcy protection on December 21, 1994.

<PAGE>

Item 4.  Submission of Matters to a Vote of Security Holders.

None.

<PAGE>

Item 5.  Market for the Partnership's Securities  and  Related  Security  Holder
         Matters.

(a) Market Information

The  Partnership's  outstanding  securities   consist   of  Limited  Partnership
Interests in Units of $500 each.  As of December 31, 1999, 20,185 Units had been
sold to the  public at a price of $500 per Unit (except for 334 Units which were
sold for a net price of $460  per  Unit  to  employees  of the Corporate General
Partners of the General Partner and  employees and securities representatives of
its affiliates).

There is no public market for the Units, and it is not anticipated  that  such a
public market will develop.

(b)  Approximate Number of Security Holders

                                    Number of Unit           Number of Units
                                   holders on Record               as of
Title of Class                      as of 12/31/99                12/31/99
--------------                     -----------------         ---------------

Units of Limited
Partnership Interests                    1,910                     20,185

(c)  Dividend History and Restrictions

During the fiscal period ended December 31, 1986 the Partnership  completed  its
offering of 20,185 Units.  Pursuant  to  Section 8  of  the  Limited Partnership
Agreement, the Partnership's  "Distributable Cash From Operations" for each year
will be determined and then distributed to the Partners.  Upon  reaching the end
of its reinvestment period (the ninth anniversary  of the  Partnership's closing
date), the Partnership will also distribute to the Partners  "Distributable Cash
From Sales or Refinancings", if  any.   The  Partnership  distributed  $555,087,
$605,558, and  $504,626 to  the  Limited  Partners  and  $29,216,  $31,872,  and
$26,560 to the General  Partners  in  1999,  1998,  and 1997, respectively.  The
cumulative cash distributions to the Limited Partners through  December 31, 1999
are $12,686,285 as compared with the Limited  Partners'  net contributed capital
of $8,987,039.

"Cash From Operations" and "Cash From Sales or Refinancing" means the  net  cash
provided by the Partnership's normal operations or as  a  result  of  any sales,
refinancings or other dispositions of equipment, respectively, after the general
expenses and current liabilities of  the  Partnership  (other than the equipment
management fee) are  paid,  as  reduced  by any reserves for working capital and
contingent liabilities to the  extent  deemed reasonable by the General Partner,
and as increased by any  portion  of  such  reserves  then deemed by the General
Partner not to be required for Partnership operations.  "Distributable Cash From
Operations" and  "Distributable Cash From Sales or Refinancings" means Cash From
Operations or Cash From Sales or Refinancings,  respectively, reduced by amounts
which the General Partner determines  shall be  reinvested  (through  the  ninth
anniversary of the Partnership's  closing date)  in additional  Equipment and by
payments of all accrued but unpaid equipment management fees.

For  rendering  services  in  connection  with  the  normal  operations  of  the
Partnership, the Partnership will pay  to  the  General  Partner  a  Partnership
management  fee  equal  to 7%  of  the  monthly rental billings collected.  Each
distribution  of  Distributable  Cash From Operations and any Distributable Cash
From Sales or Refinancings from gains of the Partnership  shall be allocated 95%
to the Limited Partners and 5% to the General Partner.  Any losses from sales or
refinancings of equipment shall be allocated  99% to the Limited Partners and 1%
to the General  Partner  until  "Payout"  has occurred.  "Payout" means the time
when the  aggregate  amount  of all  distributions  to  the  Limited Partners of
Distributable  Cash  From  Operations  and of  Distributable Cash From Sales  or
Refinancings equals the aggregate  amount  of  the  Limited  Partners'  original
invested capital plus a cumulative 10% annual return (compounded daily) on their
aggregate  unreturned  invested  capital  (calculated  from the beginning of the
first full  fiscal quarter following the Partnership's closing date).  Including
the distribution for  the  fourth  quarter  of  1999  made  February  11,  2000,
cumulative distributions to date are $636.00 per  Unit.   This  constitutes 127%
of your initial  investment.   After  Payout  has  occurred,  any  Distributable
Cash From Sales  or  Refinancings will be distributed 15% (plus an additional 1%
for each 1% by which  the  total  of  all  Limited  Partners'  original  Capital
Contributions actually paid or  allocated  to  the  Partnership's  investment in
equipment exceeds  the  greater  of  (i)  80%  of  the  gross  proceeds  of  the
Partnership's offering of Units, reduced by 0.0625%  for  each  1%  of  leverage
encumbering Partnership equipment, or (ii) 75%  of  the gross  proceeds of  such
offering) to the General Partner, and the  remainder  to the  Limited  Partners.
It is  not  anticipated  that  Payout  will  occur as of the liquidation of this
Partnership.

Distributable Cash, if any,  will  be  distributed  within  60  days  after  the
completion of each of the first three fiscal quarters of each Partnership fiscal
year, and within 120  days  after  the completion of each fiscal year, beginning
after the first full fiscal quarter  following  the  Partnership's closing date.
Each  such distribution will be described in a statement  sent  to  the  Limited
Partners.

<PAGE>

Item 6.  Selected Financial Data.

The following table sets forth  selected  financial  information  regarding  the
Partnership's financial position and operating results.  This information should
be read in conjunction  with  the  financial  statements  and notes thereto, and
Management's Discussion and  Analysis  of  Financial  Condition  and  Results of
Operations, which are  included in Item 7. and 8., respectively, of this report.

<TABLE>
<CAPTION>


                                                        For the Years Ended December 31,

                                        1999             1998             1997             1996             1995
                                    -------------------------------------------------------------------------------

<S>                                 <C>              <C>              <C>              <C>              <C>

Operating Data

Rental Income                       $    866,790     $  1,532,778     $  1,773,096     $  1,557,912     $  2,483,009
Interest Income                           11,964           12,385           11,152           18,063           16,961
Net Income                                86,127          387,470          401,383          160,016          471,147
Net Income Per Limited
  Partnership Unit                          2.82            17.62            18.57             5.35            21.01
Distributions to Partners                584,303          637,430          531,186          903,015          956,134
Distributions Per Limited
  Partnership Unit                         27.50            30.00            25.00            42.50            45.00

Balance Sheet Data

Cash and Cash Equivalents           $    421,949     $    403,150     $    253,590     $    265,199     $    245,755
Computer Equipment at Cost             1,002,046        3,589,735        6,164,470        5,844,357        7,636,323
Total Assets                             685,432        1,477,641        2,382,132        2,451,823        3,116,203
Long-term Debt                             3,947          229,717          858,642          795,925          732,726
Partners' Equity                         642,085        1,140,261        1,390,221        1,520,024        2,263,023

</TABLE>

<PAGE>

Item 7.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations.

General

On April 25, 1986, the Partnership completed its offering and received from  the
escrow account $10,079,140 representing  20,185  Units  of  Limited  Partnership
Interests.  Of this amount,  the  Partnership received proceeds from the sale of
334 Units at a price  net  of  sales  commissions  for employees of the  General
Partners of the General Partner and  employees and securities representatives of
its affiliates,  who  are  allowed to purchase Units for a net price of $460 per
Unit.

Results of Operations

The Partnership realized  net  income of $86,127, $387,470, and $401,383 for the
years ended  December 31,  1999,  1998  and  1997,  respectively.  Rental income
decreased $665,988 or 43% and decreased  $240,318  or  14%  in  1999  and  1998,
respectively.  The current year  decrease in rental income is due primarily to a
decrease in the overall  size  of  the equipment portfolio. The 1998 decrease in
rental income is primarily due to lower rental rates obtained on equipment lease
extensions and  remarketings  resulting  after  the  initial lease term expires.
Interest income decreased slightly in the  current  year  as  a  result of lower
average short-term investment balances  held  during 1998, versus the prior year
in which interest income increased due to the higher average short-term balances
held.  Other income is the result of  the  reduction  of  overstated liabilities
recorded in prior periods.   The  net  loss on sale of equipment in the current
year is due to the  early  buy  out on  several  leases  carrying  high net book
values.

Total costs and expenses decreased 36% and 17% in 1999 and  1998,  respectively,
compared to prior periods.  The decrease in  costs  and  expenses is primarily a
result of lower depreciation expense.  The current year decrease in depreciation
expense  is  attributable  to  a  portion  of  the   equipment  becoming   fully
depreciated.   Interest  expense  decreased $44,143 between 1999 and 1998 due to
the continued paydown of long-term debt.   General  and  administrative expenses
decreased $96,840 or 30% mainly due to cost cutting efforts  on  behalf  of  the
General Partner during the current year.

The Partnership recorded net income  per  Limited  Partnership  Unit  of  $2.82,
$17.62,  and  $18.57  for  the  years  ended  December 31, 1999,  1998 and 1997,
respectively.  The allocation for each of the years  includes  a  cost  recovery
allocation of profit and loss among the General and Limited Partners.  This cost
recovery allocation is required to maintain capital accounts consistent with the
distribution provisions of the  Partnership  Agreement.  In certain periods, the
cost recovery of profit and  loss may result in an allocation of net loss to the
Limited Partners in instances when the  Partnership's operations were profitable
for the period.

<PAGE>

Liquidity and Capital Resources

For the year ended December 31, 1999, rental revenue  generated  from  operating
leases  and  sales  proceeds generated from equipment  sales  were  the  primary
sources  of  funds  for  the  Partnership.  As equipment leases  terminate,  the
General Partner determines if the equipment will be extended to the same lessee,
remarketed to  another  lessee,  or sold.   This decision is made upon analyzing
which option generates the most favorable result.

It is expected that rental income will decline in the future due to two factors.
First, lower rates are obtained on the remarketing of  existing  equipment  upon
expiration of the original leases.  Typically the remarketed rates are lower due
to the decrease in  useful  life  of  the  equipment.   Secondly, the increasing
change of  technology  in the computer industry usually decreases the demand for
older equipment, thus increasing the possibility of obsolescence.  Both of these
factors together will cause remarketed rates to be lower than original rates and
will cause certain leases  to terminate upon expiration.  This decrease however,
should  not  affect  the  partnership's   ability  to   meet  its   future  cash
requirements, including long-term debt obligations.  To the  extent  that future
cash flows should be insufficient to meet the Partnership's  operating  expenses
and liabilities,  additional  funds  could  be  obtained  through  the  sale  of
equipment, or a reduction in the  rate of  cash  distributions.   Future  rental
revenues amount to $117,932 and are to be received over the next  two years (see
note 4 to the financial statements).

The Partnership's investing activities for the year resulted in equipment  sales
with a net depreciated cost basis of $328,283, generating $213,793 in  proceeds.
The  Partnership will not purchase equipment in the future  as  the  Partnership
reached the end of its extended reinvestment period in June, 1997.

The Partnership's financing  activities  included a  paydown on  long-term  debt
during 1999 of $225,770.  The Partnership will  payoff its  remaining  long-term
debt of $3,947 by 2000.  Total  long-term debt  assumed  by the Partnership from
inception is $7,995,934, for a total leverage of 25%.

Cash distributions paid in the first quarter of 2000 are currently at an  annual
level of 6% per Limited Partnership Unit, or $7.50 per Limited Partnership Unit.
During  1999,   the  Partnership  distributed  a  total of  $27.50  per  Limited
Partnership Unit, of which $2.82 per Unit represents  income and $24.68 per Unit
represents a return of capital.  For the  quarter ended  December 31, 1999,  the
Partnership  declared  a  cash  distribution of $159,356, of  which  $7,968  was
allocated  to  the  General  Partner and $151,388 was allocated to  the  Limited
Partners.  The  distribution  subsequently  occurred  on February 11, 2000.  The
Partnership expects to continue paying at or near this level in the future.  The
effects of  inflation  have  not been significant to the Partnership and are not
expected to have any material impact in future periods.

<PAGE>

Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA



                          Independent Auditors' Report
                          ----------------------------



The Partners of Wellesley Lease Income Limited Partnership III-D:

We have  audited the  accompanying  balance  sheets of  Wellesley  Lease  Income
Limited Partnership III-D (a Massachusetts Limited Partnership)  as of  December
31, 1999 and 1998,  and the  related  statements of operations, partners' equity
(deficit) and cash flows for  each of the  years in  the three-year period ended
December 31, 1999. In connection with our audits of the financial statements, we
have also audited  the  accompanying financial statement schedule II for each of
the years  in the  three-year  period ended  December 31, 1999.  These financial
statements  and this financial  statement  schedule are the responsiblity of the
Partnership's management.  Our responsibility is to  express an opinion on these
financial statements and this financial statement schedule based on our audits.

We  conducted  our  audits  in  accordance  with  generally  accepted   auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used  and  significant  estimates made by
management, as well as evaluating the overall financial statement  presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements  referred to above  present fairly,  in
all material respects, the financial position of  Wellesley Lease Income Limited
Partnership III-D  as of  December 31, 1999 and 1998,  and  the  results  of its
operations and its cash flows for each of  the years  in the  three-year  period
ended  December 31, 1999,  in  conformity  with  generally  accepted  accounting
principles.  Also, in our opinion, the  related  financial  statement  schedule,
when considered in relation to the basic financial  statements taken as a whole,
presents fairly, in all material respects, the information set forth therein.

As discussed in Note 1, the General  Partner  has  announced  its  intention  of
winding down the operations of the Partnership in 2000.   The  General  Partner
will continue  to maintain and  remarket the  existing  portfolio  as  equipment
leases expire, and equipment returned by lessees will be sold.


                                                      KPMG LLP


Boston, Massachusetts
February 25, 2000


<PAGE>

<TABLE>
<CAPTION>

                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                     (A Massachusetts Limited Partnership)

                                 Balance Sheets
                           December 31, 1999 and 1998

                                     Assets
                                     ------

                                                                       1999                  1998
                                                                  --------------        --------------


<S>                                                               <C>                   <C>

Investment property, at cost:
  Computer equipment                                              $    1,002,046        $    3,589,735
    Less accumulated depreciation                                        793,493             2,575,703
                                                                  --------------        --------------
      Investment property, net                                           208,553             1,014,032

Cash and cash equivalents                                                421,949               403,150
Rents receivable, net                                                      3,701                 5,483
Accounts receivable - affiliates                                          51,229                48,059
Other assets                                                                   -                 6,917
                                                                  --------------        --------------

    Total assets                                                  $      685,432        $    1,477,641
                                                                  ==============        ==============

                        Liabilities and Partners' Equity
                        --------------------------------

Liabilities:
  Current portion of long-term debt                               $        3,947        $      225,770
  Accounts payable and accrued expenses - affiliates                       8,042                23,637
  Accounts payable and accrued expenses                                   24,170                52,371
  Unearned rental revenue                                                  7,188                31,655
  Long-term debt, less current portion                                         -                 3,947
                                                                  --------------        --------------

    Total liabilities                                                     43,347               337,380
                                                                  --------------        --------------

Partners' equity:
  General Partner:
    Capital contribution                                                   1,000                 1,000
    Cumulative net income                                                666,718               637,502
    Cumulative cash distributions                                       (667,718)             (638,502)
                                                                  --------------        --------------
                                                                               -                     -
                                                                  --------------        --------------

Limited Partners (20,185 units):
    Capital contribution, net of offering costs                        8,987,039             8,987,039
    Cumulative net income                                              4,341,331             4,284,420
    Cumulative cash distribuitons                                    (12,686,285)          (12,131,198)
                                                                  --------------        --------------
                                                                         642,085             1,140,261
                                                                  --------------        --------------
    Total partners' equity                                               642,085             1,140,261
                                                                  --------------        --------------

    Total liabilities and partners' equity                        $      685,432        $    1,477,641
                                                                  ==============        ==============


                 See accompanying notes to financial statements.


</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                     (A Massachusetts Limited Partnership)

                            Statements of Operations
                   Year Ended December 31, 1999, 1998 and 1997



                                                            1999                    1998                    1997
                                                       --------------          --------------          --------------

  <S>                                                  <C>                     <C>                     <C>

Revenue:
  Rental income                                        $      866,790          $    1,532,778          $    1,773,096
  Interest income                                              11,964                  12,385                  11,152
  Warrant income                                               11,202                       -                       -
  Other income                                                 16,249                       -                       -
  Net gain (loss) on sale of equipment                        (57,040)                 28,709                  50,663
                                                       --------------          --------------          --------------

    Total revenue                                             849,165               1,573,872               1,834,911
                                                       --------------          --------------          --------------

Costs and expenses:
  Depreciation                                                534,647                 825,145               1,103,845
  Interest                                                      7,245                  51,388                  74,095
  General and administrative                                  220,997                 318,537                 301,757
  Provision for (reversal of) doubtful accounts                   149                  (8,668)                (46,169)
                                                       --------------          --------------          --------------

    Total costs and expenses                                  763,038               1,186,402               1,433,528
                                                       --------------          --------------          --------------

Net income                                             $       86,127          $      387,470          $      401,383
                                                       ==============          ==============          ==============


                 See accompanying notes to financial statements.

</TABLE>

<PAGE>

<TABLE>
<CAPTION>

               WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                     (A Massachusetts Limited Partnership)

                    Statements of Partners' Equity (Deficit)
                 Years Ended December 31, 1999, 1998 and 1997



                                                            1999                    1998                    1997
                                                       --------------          --------------          --------------
<S>                                                    <C>                     <C>                     <C>

Equity at December 31, 1996                            $            -          $    1,520,024          $    1,520,024

Net income                                                     26,560                 374,823                 401,383

Cash distributions                                            (26,560)               (504,626)               (531,186)
                                                       --------------          --------------          --------------

Equity at December 31, 1997                                         -               1,390,221               1,390,221

Net income                                                     31,872                 355,598                 387,470

Cash distributions                                            (31,872)               (605,558)               (637,430)
                                                       --------------          --------------          --------------

Equity at December 31, 1998                                         -               1,140,261               1,140,261

Net income                                                     29,216                  56,911                  86,127

Cash distributions                                            (29,216)               (555,087)               (584,303)
                                                       --------------          --------------          --------------

Equity at December 31, 1999                            $            -          $      642,085          $      642,085
                                                       ==============          ==============          ==============

                 See accompanying notes to financial statements.

</TABLE>

<PAGE>

<TABLE>
<CAPTION>


                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                     (A Massachusetts Limited Partnership)

                            Statements of Cash Flows
                   Years Ended December 31, 1999, 1998 and 1997



                                                            1999                    1998                    1997
                                                       --------------          --------------          --------------

<S>                                                    <C>                     <C>                     <C>

Cash flows from operating activities:
  Net income                                           $       86,127          $      387,470          $      401,383
                                                       --------------          --------------          --------------

  Adjustments to reconcile net income to net cash
    provided by operating activities:
      Depreciation                                            534,647                 825,145               1,103,845
      Provision for (reversal of) doubtful accounts               149                  (8,668)                (46,169)
      Net (gain) loss on sale of equipment                     57,040                 (28,709)                (50,663)
      Net decrease in current assets                            5,379                  31,825                 129,262
      Net (decrease) increase in current liabilities          (68,263)                (25,606)                 (2,605)
                                                       --------------          --------------          --------------

        Total adjustments                                     528,952                 793,987               1,133,670
                                                       --------------          --------------          --------------

        Net cash provided by operating activities             615,079               1,181,457               1,535,053
                                                       --------------          --------------          --------------

Cash flows from investing activities:
  Purchase of investment property                                   -                       -              (1,168,532)
  Proceeds from sales of investment property                  213,793                 234,458                  90,339
                                                       --------------          --------------          --------------

        Net cash provided by (used in)
          investing activities                                213,793                 234,458              (1,078,193)
                                                       --------------          --------------          --------------

Cash flows from financing activites:
  Proceeds from borrowings on long-term debt                        -                       -                 708,661
  Principal payments on long-term debt                       (225,770)               (628,925)               (645,944)
  Cash distributions to partners                             (584,303)               (637,430)               (531,186)
                                                       --------------          --------------          --------------

        Net cash used in financing activities                (810,073)             (1,266,355)               (468,469)
                                                       --------------          --------------          --------------

Net increase (decrease) in cash and cash equivalents           18,799                 149,560                 (11,609)

Cash and cash equivalents at beginning of year                403,150                 253,590                 265,199
                                                       --------------          --------------          --------------

Cash and cash equivalents at end of year               $      421,949          $      403,150          $      253,590
                                                       ==============          ==============          ==============

Supplemental cash flow information:
  Interest paid during the year                        $        7,245          $       51,388          $       74,095
                                                       ==============          ==============          ==============

                 See accompanying notes to financial statements.

</TABLE>

</PAGE>


                 WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                      (A Massachusetts Limited Partnership)

                          Notes to Financial Statements
                        December 31, 1999, 1998 and 1997

(1)  Organization and Partnership Matters

The   Partnership   was   organized  under  the  Massachusetts  Uniform  Limited
Partnership Act on March 29, 1985.  The Amended Agreement of Limited Partnership
authorized the issuance of up to 25,000 Limited Partnership  Units at a per unit
gross  price  of  $500  and  up  to  20  additional units  to  affiliates.   The
Partnership closed on April 25, 1986, with 20,185 units.

Pursuant  to  the  terms  of  the  Amended  Agreement  of  Limited  Partnership,
Distributable  Cash  From  Operations and  Profits  for  federal  income tax and
financial reporting  purposes from  normal operations and any Distributable Cash
From Sales or Refinancings from gains of the Partnership  shall be allocated 95%
to the Limited Partners and 5% to the  General Partner.  Further, gains on sales
of equipment occurring after  the  reinvestment  period  end  shall be allocated
first to eliminate negative capital  accounts,  if any,  and  second 95%  to the
Limited Partners and  5%  to  the  General  Partner  until  "Payout".   "Payout"
means the time  when  the aggregate  amount  of all distributions to the Limited
Partners of Distributable Cash From  Operations and  of  Distributable Cash From
Sales  or  Refinancings  equals  the  aggregate amount of the Limited  Partners'
original invested capital plus a cumulative 10% annual return (compounded daily)
on their aggregate unreturned invested capital (calculated from the beginning of
the first full fiscal quarter following the Partnership's closing date).  Losses
for federal income tax and financial reporting purposes from  normal  operations
and any Distributable Cash  From  Sales  or  Refinancings  from  losses  of  the
Partnership shall be allocated 99% to the Limited Partners and 1% to the General
Partner until Payout has occurred, and 85% to the Limited Partners  and  15%  to
the General Partner thereafter.  In addition, special cost  recovery allocations
may  be required to reflect the differing initial capital contributions  of  the
General  Partner  and the Limited Partners.  The Partnership's books and records
are  in  accordance   with  the  terms  of  the  Amended  Agreement  of  Limited
Partnership.  Including the  fourth quarter  of 1999  distribution made February
11,  2000,  cumulative  distributions  to  date  are  $636.00  per  Unit.   This
constitutes  127%  of the initial investment.  It is not anticipated that Payout
will occur as of the liquidation of the Partnership.

The General Partner has contributed $1,000 in respect of its General Partnership
interest.  In addition, the General Partner and its affiliates have acquired  an
additional $10,000 of Limited Partnership Units in accordance with  the  Amended
Agreement of Limited Partnership.

The General Partner has announced its intention of winding down  the  operations
of the Partnership in 2000.  The General Partner will  continue  to maintain and
remarket the existing  portfolio  as  equipment  leases  expire,  and  equipment
returned by lessees will be sold.

</PAGE>

                 WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                      (A Massachusetts Limited Partnersip)

                          Notes to Financial Statements

(2)  Summary of Significant Accounting Policies

General

The Partnership's records are maintained on the accrual basis  of  accounting so
that revenues are recognized as earned and expenses are recognized as  incurred.
Assets and  liabilities  are those of the Partnership  and  do not  include  any
assets and liabilities of the individual partners.  The preparation of financial
statements in conformity with  generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities  and disclosure  of contingent  assets and liabilities at
the date of the financial  statements and  the  reported amounts of revenues and
expenses during the reporting period.   Actual  results  could differ from those
estimates.

Depreciation on investment property purchased in 1987 and thereafter is provided
using the double-declining balance method, generally  over a  five-year  period.
The Partnership's policy is to  periodically  review the  estimated  fair market
value of its equipment to  assess the recoverability of its underpreciated cost.
In accordance with this policy, the Partnership records a charge to depreciation
expense  in instances when the net book  value  of  equipment  exceeds  its  net
realizable  value.  Routine maintenance and repairs  are expensed  as  incurred.
Major betterments and enhancements are capitalized and depreciated in accordance
with the Partnership's depreciation policy.

Cash and Cash Equivalents

The   Partnership  considers  cash  and  short-term  investments  with  original
maturities of three months or less to be cash and cash equivalents.

Allowance for Doubtful Accounts

The financial statements include allowances for estimated losses  on  receivable
balances.  The allowances for doubtful accounts are  based  on  past  write  off
experience  and an evaluation of potential  uncollectible  accounts  within  the
current receivable balances.  Receivable balances which  are  determined  to  be
uncollectible are charged against the allowance and  subsequent  recoveries,  if
any, are credited to the allowance. At December 31, 1999 and 1998, the allowance
for  doubtful  accounts  included in  rents  receivable  was  $1,087  and  $938,
respectively, and $0 and $0 included in sales receivable, respectively.

</PAGE>

                 WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                      (A Massachusetts Limited Partnership)

                          Notes to Financial Statements

Income Taxes

No provision for federal income taxes has been made as the  liability  for  such
taxes is that of the Partners rather than the Partnership.   Taxable  income, as
reported  on  Schedule K-1,  Form 1065  "Partner's  Share  of  Income,  Credits,
Deductions,  etc.",  was $94,430, $288,189, and $406,922 in 1999, 1998 and 1997,
respectively (see note 7).

(3)  Investment Property

At  December  31,  1999,   the  Partnership  owned  computer  equipment  with  a
depreciated cost basis of $208,553.  All  purchases  of  computer  equipment are
subject to a 3% acquisition fee paid to the General Partner.

(4)  Leases

Description of leasing arrangements:

Operations consist primarily  of  leasing  computer  equipment.   All  equipment
leases are classified as operating leases and expire over the next two years.

Minimum lease payments scheduled to be received in  the  future  under  existing
noncancelable operating leases are as follows:

          2000          $    115,412
          2001                 2,520
                        ------------

                        $    117,932
                        ============

Four  lessees,  American Hard Cider,  Incorporated,  FaxNet,  Incorporated,  The
Internet  Access Company, Incorporated,  and  VIP Calling,  Incorporated,  lease
equipment  in  excess  of  10%  of  total  rental  income  for  the  year  ended
December 31, 1999.  The related rental payments comprise 20.55%, 11.59%, 33.35%,
and 10.73%, respectively, of the toal rental income for the year  ended December
31, 1999. Five lessees, American Hard Cider, Incorporated, FaxNet, Incorporated,
Hughes Aircraft, Incorporated,  The Internet Access Company,  Incorporated,  and
VIP Calling, Incorporated, lease equipment comprising  21.33%,  26.17%,  14.91%,
11.21%  and  10.65%,  respectively, of the total equipment portfolio at December
31, 1999.

</PAGE>

                 WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                      (A Massachusetts Limited Partnership)

                           Notes to Financial Statements

(5)  Related Party Transactions

Fees, commissions and other expenses paid or accrued by the Partnership  to  the
General Partner or affiliates  of  the  General  Partner  for  the  years  ended
December 31 are as follows:



                                      1999             1998             1997
                                      ----             ----             ----

Equipment acquisition fee          $        -       $        -       $   34,035
Management fees                        63,383          115,631          131,657
Reimbursable expenses paid            123,358          188,015          165,800
                                   ----------       ----------       ----------

                                   $  186,741       $  303,646       $  331,492
                                   ==========       ==========       ==========

Under the terms of the Partnership Agreement, the General Partner is entitled to
an equipment acquisition fee of 3% of the purchase price paid by the Partnership
for the equipment.  The General Partner is also entitled  to  a  management  fee
equal to 7% of the  monthly  rental  billings  collected.  Also, the Partnership
reimburses the  General Partner and its affiliates for certain expenses incurred
by them in connection with the operation of the Partnership.

(6)  Long-term Debt

Long-term debt at December 31, 1999 consists of one  installment  note  totaling
$3,947.  The loan is non-recourse and is  collateralized  by  equipment  on  the
respective leases with a total net book value of $7,712 and  assignment  of  the
related lease.

Maturities on long-term debt are as follows:

            2000          $   3,947
                          ---------

                          $   3,947
                          =========

</PAGE>

<TABLE>
<CAPTION>

                 WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                      (A Massachusetts Limited Partnership)

                            Notes to Financial Statements

(7)  Reconciliation of Financial Statement  Net  Income  to  Taxable  Income  to
     Partners

A reconciliation of financial statement net income to taxable income to partners
is as follows for the years ended December 31:



                                                         1999            1998            1997
                                                         ----            ----            ----

  <S>                                                 <C>             <C>             <C>

  Net income per financial statements                 $   86,127      $  387,470      $  401,383

  Provision for doubtful accounts expense for
    financial statement purposes (less than)
    in excess of provision for doubtful accounts
    expense for tax purposes                                 149          (8,868)        (43,610)

  Depreciation expense for financial statement
    purposes in excess of depreciation expense
    for tax purposes                                     231,564          33,645          20,547

  Net gain on sale of equipment for financial
    statement purposes in excess of (less than)
    net gain on sale of equipment for tax purposes      (223,410)       (124,058)         28,602
                                                      ----------      ----------      ----------

  Taxable income to partners                          $   94,430      $  288,189      $  406,922
                                                      ==========      ==========      ==========

</TABLE>

Losses for federal tax purposes from normal operations are allocated 99% to  the
Limited Partners and 1% to the General Partner. Profits for federal tax purposes
from normal operations are allocated 95% to the Limited Partners and  5%  to the
General Partner.  In addition, special cost recovery allocations may be required
to reflect any differing initial capital contribution of the General Partner and
the Limited Partners.

</PAGE>

<TABLE>
<CAPTION>


                 WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                      (A Massachusetts Limited Partnership)




Schedule II - Valuation and Qualifying Accounts and Reserves





Classification

                                            Additions
                                            Charged to
                                            (Recoveries
                           Balance at        Credited
Balance at                 Beginning        From) Costs
End of Year                 of Year         and Expenses     Charge-Offs
-----------                ----------       ------------     -----------

<S>                        <C>              <C>              <C>              <C>

Year ended
December 31, 1997          $   53,416       $  (43,610)      $        -       $    9,806
                           ==========       ==========       ==========       ==========


Year ended
December 31, 1998          $    9,086       $   (8,668)      $     (200)      $      938
                           ==========       ==========       ==========       ==========


Year ended
December 31, 1999          $      938       $      149       $        -       $    1,087
                           ==========       ==========       ==========       ==========

</TABLE>



</PAGE>




                 WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                      (A Massachusetts Limited Partnership)

                    Computer Equipment Portfolio (Unaudited)
                                December 31, 1999


Lessee

American Hard Cider, Incorporated
Evare, Limited Liability Corporation
Faxnet, Incorporated
George Melhado and Company
Hughes Aircraft Corporation
J. Walter Thompson, U.S.A., Incorporated
USG Corporation
VenturCom, Incorporated
VIP Calling, Incorporated


Equipment Description                  Acquisition Price

Computers                                    $   161,962
Peripherals                                      380,952
Other                                            459,132
                                             -----------

                                             $ 1,002,046
                                             ===========


</PAGE>

<TABLE>
<CAPTION>


Exhibit 11       WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
                      (A Massachusetts Limited Partnership)

              Computation of Net Income per Limited Partnership Unit
                   Years Ended December 31, 1999, 1998 and 1997



                                                          1999                    1998                    1997
                                                     --------------          --------------          --------------

<S>                                                  <C>                     <C>                     <C>

Net income                                           $       86,127          $      387,470          $      401,383

Gain on sale                                                (28,779)                (28,709)                (50,663)
Loss on sale                                                 85,819                       -                       -
Special cost recovery allocation                            (30,738)                (13,157)                 (6,832)
                                                     --------------          --------------          --------------

Available income (loss) from operations                     112,429                 345,604                 343,888
                                                     --------------          --------------          --------------

Allocations to General Partner:
  Income (loss) from operations                               5,621                  17,280                  17,194
  Gain on sale                                                1,439                   1,435                   2,534
  Loss on sale                                               (8,582)                      -                       -
  Special cost recovery allocation                           30,738                  13,157                   6,832
                                                     --------------          --------------          --------------

Income allocated to General Partner                          29,216                  31,872                  26,560
                                                     --------------          --------------          --------------

Income allocated to Limited Partners                 $       59,911          $      355,598          $      374,823
                                                     ==============          ==============          ==============

Number of Limited Partnership Units                          20,185                  20,185                  20,185

Net income per Limited Partnership Unit              $         2.82          $        17.62          $        18.57
                                                     ==============          ==============          ==============
</TABLE>


</PAGE>


Item 9.  Change   in  and  Disagreements  with  Accountants  on  Accounting  and
         Financial Statement Disclosures.


None.

</PAGE>

                                    Part III

Item 10.  Directors and Executive Officers of the Partnership.

(a-b) Identification of Directors and Executive Officer

The Partnership has no Directors or Officers.  As indicated in Item 1.  of  this
report, the General Partner of the Partnership is Wellesley Leasing Partnership.
Under the Partnership Agreement, the  General Partner is solely  responsible for
the operation of the Partnership's  properties, and the Limited Partners have no
right to participate in the control of such operations.  The General Partner has
three Corporate General Partners: TLP and TLPMS, both Massachusetts corporations
and Waddell & Reed Financial Services, Inc.,  a Missouri corporation.  The names
and  ages of the Directors and  Executive  Officers  of  the  Corporate  General
Partners are as follows:

TLP and TLPMS

    Name                        Title                                      Age

Nicholas C. Bogard           Director                                      54
Arthur P. Beecher            Director, President, and Clerk                62
Nancy E. Malone              Vice President                                42
Irene V. King                Vice President, Financing                     52

Waddell & Reed Financial Services, Inc.

    Name                        Title                                      Age

Keith A. Tucker              President, Chairman of the Board,             55
                               Chief Executive Officer, and Director
Robert L. Hechler            Vice President, Chief Operations Officer,     63
                               Treasurer and Director
Henry J. Herrmann            Vice President, Chief Investment Officer      57
                               and Director
Robert J. Williams, Jr.      Vice President and National Sales Manager     55
David R. Burford             Vice President, Assistant Secretary           42
                               and Associate General Counsel

(c)  Identification of certain significant persons

See Item 10.(a-b)

(d)  Family relationships

No family  relationships  exists  between  any  of  the  foregoing  Directors or
Officers.

(e) Business experience

Nicholas C. Bogard is Chairman of the Board of Directors for TLP and TLPMS.  Mr.
Bogard served as President and Director of TLP from 1982 - 1992,  and  served as
Director  of  CS  First  Boston  from  1992 - 1994.   He  has been working as an
independent consultant since 1994.   Mr. Bogard  holds  a  B.A.  from  Princeton
University and an M.B.A. from Harvard University.

Arthur P. Beecher is President, Director and Clerk of TLP and TLPMS.   Prior  to
joining TLP, he was an officer of CSA Financial Corp. of  Boston, Massachusetts,
most recently as Vice President, Finance  and  Administration  since  1975.  Mr.
Beecher  holds  a  B.S.  from  Boston  University  and  is  a  Certified  Public
Accountant.

Nancy E. Malone is Vice President of TLP and TLPMS.   Prior to joining TLP,  she
was Manager,  Lease  Financing  for  11  years at CSA Financial Corp. of Boston,
Massachusetts.  Ms. Malone holds a B.A. from The College of the Holy Cross.

Irene V. King is Vice President, Finance for TLP and TLPMS.   Prior  to  joining
TLP in April 1994, she was Director  of  Public  Income  Funds  at CSA Financial
Corp. of Boston, Massachusetts and was previously  Vice President of  Finance at
First Alliance Corp. of Wellesley,  Massachusetts.   Ms. King  holds a B.A. from
Barat College of the Sacred Heart, Lake Forest, Illinois.

Keith A. Tucker is President, Chief Executive Officer and Director of  Waddell &
Reed; Chairman of  the  Board  of  Directors  of  WRIMCO,  Waddell & Reed, Inc.,
Waddell & Reed  Services Company,  Waddell & Reed Asset  Management  Company and
Torchmark  Distributors,  Inc.,   as  affiliate  of  Waddell & Reed, Inc.;  Vice
Chairman of the Board of Directors,  Chief  Executive  Officer  and President of
United Investors Management Company; Vice Chairman of the Board of  Directors of
Torchmark Corporation; and President of each of the funds in the United, Waddell
& Reed and TMK/United mutual fund groups.  He is also  Director of  Southwestern
Life Corporation.  Prior to joining  Torchmark  Coporation  in 1991,  Mr. Tucker
was  with  Trivest, Inc.  and  Trivest  Securities Corporation in Miami, Florida
since  1987,  most  recently  as  the  Senior  Vice  President  and   President,
respectively.  Prior to Trivest, Inc., he was Director of Atlantis  Group, Inc.,
a diversified  company.  Mr. Tucker  holds a  B.B.A.  and a  J.D.  both from the
University of Texas.

Robert L. Hechler is Vice President,  Chief  Operations  Officer,  Director  and
Treasurer of Waddell & Reed;   Executive  Vice  President,  Principal  Financial
Officer, Director and Treasurer of WRIMCO; President, Chief  Executive  Officer,
Principal Financial Officer,  Director  and  Treasurer of  Waddell & Reed, Inc.;
Director and Treasurer  of  Waddell &  Reed  Services  Company;  Vice President,
Treasurer  and  Director of Torchmark Distributors, Inc.; and Vice President and
Principal Financial Officer  of  each of the funds in the United, Waddell & Reed
and TMK/United mutual fund groups.   He  has been employed by Waddell & Reed and
its affiliates since 1977.   Mr. Hechler  holds  a  B.S.  from the University of
Illinois and an M.B.A. from the University of Chicago.

</PAGE>

Henry J. Herrmann  is Vice President,  Chief Investment Officer  and Director of
Waddell & Reed;   Director of Waddell & Reed, Inc.;  President,  Chief Executive
Officer,   Chief Investment Officer and Director of  WRIMCO  and  Waddell & Reed
Asset Management Company; Senior Vice President and Chief Investment  Officer of
United Investors Management Company; and Vice President of each of the  funds in
the United,  Waddell & Reed  and  TMK/United  mutual fund  groups.   He has been
employed by Waddell & Reed  and its affiliates since 1971.  Mr. Herrmann holds a
B.S. from New York University.

Robert J. Williams, Jr. is Vice President and National Sales Manager of  Waddell
& Reed and  Executive Vice President  and  National Sales Manager  of  Waddell &
Reed,Inc.  He has been employed by Waddell & Reed, Inc. since July 1996.  He was
employed with  Charles Schwab & Company  from November 1991 to  July 1995.  From
August 1984  to  October 1991,  he was employed by  American  Express  Financial
Advisors or  its affiliates.   Mr. Williams holds a  B.S. from the University of
Utah and an M.B.A. from California State-Humbolt.

David Burford is Vice  President  and  Associate  General  Counsel.   He  joined
Waddell & Reed in  1985  and  has  responsibilities  in  many  areas,  including
broker-dealer compliance, litigation,  regulatory  concerns,  retirement  plans,
tax issues, employment  claims,  insurance  and  contracts.   Prior  to  joining
Waddell & Reed, he spent  three  years  at  a  Kansas  City  law  firm,  working
primarily  on  tax-related matters.   Mr. Burford  has  a  bechelors  degree  in
business  administration  (accounting) from the University of Missouri and a law
degree from Duke University.

(f)  Involvement in certain legal proceedings

The Partnership is not aware of any legal proceedings  against any  Director  or
Executive Officer of the Corporate General Partners which  may be  important for
the evaluation of any such person's ability and integrity.

</PAGE>


Item 11.  Management Remuneration and Transactions.

(a), (b), (c), (d), and (e): The Officers and Directors of the Corporate General
Partners receive no current or proposed direct remuneration in such  capacities,
pursuant to any standard arrangements or otherwise,  from  the  Partnership.  In
addition, the Partnership has not paid  and does not propose to pay any options,
warrants  or  rights  to  the  Officers  and Directors of the Corporate  General
Partners.  There exists no  remuneration plan or arrangement with any Officer or
Director  of  the Corporate  General Partners  resulting  from  the resignation,
retirement or any other termination.  See note 5  to  the  financial  statements
included in Item 8. of this report  for  a  description of the remuneration paid
by the Partnership to the General  Partner  and its affiliates during 1999, 1998
and 1997.


</PAGE>

Item 12.  Security Ownership of Certain Owners and Management.

By virtue of its organization as a  limited  partnership,  the  Partnership  has
outstanding no securities possessing traditional  voting  rights.   However,  as
provided for in Section  13.2  of  the  Amended Agreement of Limited Partnership
(subject to  Section  13.3),  a  majority  interest of the Limited Partners have
voting rights with respect to:

1.  Amendment of the Limited Partnership Agreement;

2.  Termination of the Partnership;

3.  Removal of the General Partner; and

4.  Approval or disapproval of the sale of substantially  all the  assets of the
    Partnership.

No person or group is kown by the General Partner to own benefically  more  than
5% of the Partnership's  20,185  outstanding  Limited  Partnership Units  as  of
December 31, 1999.

By virtue of its organization as a limited partnership, the  Partnerhsip  has no
Officers or Directors.  See also note 1 to the financial statements  included in
Item 8. and Item 10. of this report.

</PAGE>

Item 13.  Certain Relationships and Related Transactions.

(a), (b), and  (c):   The  General  Partner  of  the  Partnership  is  Wellesley
Leasing Partnership, a  Massachusetts general  partnership  which  in  turn  has
three   Corporate   General    Partners:   TLP  and  TLPMS,  both  Massachusetts
corporations and Waddell & Reed,  a Missouri corporation.  The Corporate General
Partners' Directors and Executive Officers are  identified in  Item 10.  of this
report.  The Partnership was not involved in any  transaction  involving  any of
these Directors or Officers or any  member  of the  immediate  family  of  these
individuals, nor did  any of  these  persons provide services to the Partnership
for which they received direct or indirect remuneration. Similarly, there exists
no business  relationships  between  the Partnership and any of the Directors or
Officers of the Corporate General Partners,  nor  were  any  of  the individuals
indebted to the Partnership.

The General Partner is responsible for acquiring, financing, leasing and selling
equipment for the Partnership.  TLPMS proposes  for  the  Partnership  equipment
acquisitions, leasing transactions,  financing and refinancing transactions, and
sale transactions  for  approval  by  the  Executive  Committee and oversees the
operation,  management and use of each Partnership's equipment.  TLP oversaw the
marketing of  the  Units  and  oversees  all  administrative  functions  of  the
Partnership and, together with Waddell & Reed, provides substantially all of the
General Partner's capital resources.   In consideration  of  such  services  and
capital commitments, TLP receives 30%, Waddell & Reed  receives  10%  and  TLPMS
receives 60% of all compensation received by the General Partner  in  connection
with the  formation  and  operation  of  the  Partnership  (including  equipment
management  fees,  acquisition  fees,  subordinated  remarketing  fees  and  the
General  Partner's  share  of  Distributable  Cash  From Sales or Refinancings),
except for Acquisition Fees,  as  to  which  TLP  receives  15%,  Waddell & Reed
receives 10% and TLPMS  receives  75%.   The General Partner also was reimbursed
in an amount equal to 3% of the gross proceeds of the Partnership's offerings
for  organizational  and  offering expenses; all such expenses in excess of that
amount were borne by TLP.  See  note  5  to the financial statements included in
Intem 8. of this report for a  description  of  payments made by the Partnership
to the General Partner.

For information regarding  the  settlements  between  the  Partnership  and  the
Liquidating Estate of CIS Corporation, et al,  arising out of the emergence from
bankruptcy of CIS and CMI, see Item 3. Legal Proceedings.

</PAGE>

                                 Part IV

Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K: None.

  (a)  1.  Financial Statements                                         Page No.

           Independent Auditors' Report                                      15
           Balance Sheets at December 31, 1999 and 1998                      16
           Statements of Operations
             Years Ended December 31, 1999, 1998 and 1997                    17
           Statements of Partners' Equity (Deficit)
             Years Ended December 31, 1999, 1998 and 1997                    18
           Statements of Cash Flows
             Years Ended December 31, 1999, 1998 and 1997                    19
           Notes to Financial Statements                                  20-24


       2.  Financial Statement Schedules

           Schedule II - Valuation and Qualifying Accounts and Reserves      25

           All other financial statement schedules are omitted because
           they are not  applicable, the data is not significant,
           or the required information is shown elsewhere in this report.

           Computer Equipment Portfolio (Unaudited)                          26


       3.  Exhibit Index

           11 Statement regarding computation of net income per
           Limited Partnership Unit                                          27

  (b)      Report on Form 8-K
           N/A

</PAGE>

                                   SIGNATURE


Pursuant to the requirements of Section 13 or 15(d) of the  Securities  Exchange
Act of 1934, the Registrant has duly caused this report to  be  signed  on  its
behalf by the undersigned, thereunto duly authorized.

WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-D
(Registrant)

By:   Wellesley Leasing Partnership,
      its General Partner

By:   TLP Leasing Programs, Inc.,
      one of its Corporate General Partners

By:   Arthur P. Beecher,
      President

Date: March 27, 2000