UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

(Mark One)

[ X ]    QUARTERLY  REPORT  PURSUANT  TO SECTION  13 OR 15(d) OF THE  SECURITIES
         EXCHANGE ACT OF 1934

For the quarterly period ended September 29, 2001
                               ------------------

                                      OR

[__]     TRANSITION  REPORT  PURSUANT  TO SECTION 13 OR 15(d) OF THE  SECURITIES
         EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

                         Commission file number: 0-19217
                                                 -------


                     American Tax Credit Properties III L.P.
                     ---------------------------------------
             (Exact name of Registrant as specified in its charter)

         Delaware                                                13-3545006
--------------------------------                              -----------------
(State or other jurisdiction of                               (I.R.S. Employer
 incorporation or organization)                              Identification No.)

Richman Tax Credit Properties III L.P.
599 West Putnam Avenue, 3rd Floor
Greenwich, Connecticut                                               06830
-------------------------------------                            -------------
(Address of principal executive offices)                           (Zip Code)

Registrant's telephone number, including area code:  (203) 869-0900
                                                     --------------

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 preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to filing requirements
for the past 90 days.

Yes  X   No   .
    ---    ---

<PAGE>


                     AMERICAN TAX CREDIT PROPERTIES III L.P.

                         PART I - FINANCIAL INFORMATION
                                  ---------------------

     Item 1. Financial Statements
             --------------------

     Table of Contents                                                     Page
     -----------------                                                     ----
     Balance Sheets..........................................................3

     Statements of Operations................................................4

     Statements of Cash Flows................................................5

     Notes to Financial Statements...........................................7


                                       2
<PAGE>

<TABLE>
<CAPTION>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.
                                 BALANCE SHEETS
                                   (UNAUDITED)

                                                                     September     March 30,
                                                             Notes    29, 2001       2001
                                                             -----   ---------     --------
            ASSETS

<S>                                                                 <C>           <C>
            Cash and cash equivalents                               $  393,919    $  543,718
            Investments in bonds                               2     3,058,101     2,951,695
            Investment in local partnerships                   3     2,632,382     2,987,706
            Interest receivable                                         29,065        29,375
                                                                   -----------   -----------
                                                                    $6,113,467   $ 6,512,494
                                                                    ==========   ===========

            LIABILITIES AND PARTNERS' EQUITY (DEFICIT)

            Liabilities

              Accounts payable and accrued expenses                 $1,046,756   $ 1,182,966
              Payable to general partner and affiliates              1,681,370     1,507,546
              Other                                                                    2,200
                                                                   -----------   -----------
                                                                     2,728,126     2,692,712
                                                                   -----------   -----------
            Partners' equity (deficit)

              General partner                                         (282,968)     (277,969)
              Limited partners (35,883 units of limited
               partnership interest outstanding)                     3,515,759     4,010,666
              Accumulated other comprehensive income, net      2       152,550        87,085
                                                                   -----------   -----------
                                                                     3,385,341     3,819,782
                                                                   -----------   -----------
                                                                   $ 6,113,467   $ 6,512,494
                                                                   ===========   ===========
</TABLE>


                       See Notes to Financial Statements.


                                       3
<PAGE>

<TABLE>
<CAPTION>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.
                            STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

                                      Three Months    Six Months   Three Months    Six Months
                                          Ended         Ended         Ended          Ended
                                      September 29,  September 29,  September 29,  September 29,
                               Notes      2001          2001           2000           2000
                               -----  ------------   ------------   ------------   ------------

REVENUE

<S>                                   <C>           <C>           <C>             <C>
Interest                              $   52,760    $  106,900    $   58,398      $  115,576
Other income from local          3         1,581         9,706         1,580           1,580
partnerships                          ----------    ----------    ----------      ----------

TOTAL REVENUE                             54,341       116,606        59,978         117,156
                                      ----------    ----------    ----------      ----------
EXPENSES

Administration fees                       57,643       115,286        57,643         115,286
Management fees                           57,643       115,286        57,643         115,286
Professional fees                         14,584        28,297        12,818          22,989
Printing, postage and other                4,155         8,098         5,828          10,284
                                      ----------    ----------    ----------      ----------

TOTAL EXPENSES                           134,025       266,967       133,932         263,845
                                      ----------    ----------    ----------      ----------

Loss from operations                     (79,684)     (150,361)      (73,954)       (146,689)

Equity in loss of investment
  in local partnerships          3      (156,563)     (349,545)     (145,784)       (352,035)
                                      ----------    ----------    ----------      ----------

NET LOSS                                (236,247)     (499,906)     (219,738)       (498,724)

Other comprehensive income       2       118,155        65,465        25,253          32,269
                                      ----------    ----------    ----------      ----------

COMPREHENSIVE LOSS                    $ (118,092)   $ (434,441)   $ (194,485)     $ (466,455)
                                      ==========    ==========    ==========      ==========

NET LOSS ATTRIBUTABLE TO

  General partner                     $   (2,362)   $   (4,999)   $   (2,198)     $   (4,987)
  Limited partners                      (233,885)     (494,907)     (217,540)       (493,737)
                                      ----------    ----------    ----------      ----------
                                      $ (236,247)   $ (499,906)   $ (219,738)     $ (498,724)
                                      ==========    ==========    ==========      ==========
NET LOSS per unit of limited
  partnership interest
  (35,883 units of limited
  partnership interest)               $    (6.52)  $    (13.79)   $    (6.06)     $  (13.76)
                                      ==========   ===========    ==========      ==========
</TABLE>


                       See Notes to Financial Statements.


                                       4
<PAGE>

<TABLE>
<CAPTION>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.
                            STATEMENTS OF CASH FLOWS
                  SIX MONTHS ENDED SEPTEMBER 29, 2001 AND 2000
                                   (UNAUDITED)

                                                              2001          2000
                                                           ---------     ----------
    CASH FLOWS FROM OPERATING ACTIVITIES

<S>                                                         <C>           <C>
    Interest received                                       $ 66,269      $ 76,906
    Cash used for local partnerships for deferred
    expenses                                                  (2,200)       (4,750)
    Cash paid for
       administration fees                                  (122,748)       (6,748)
       management fees                                       (50,000)      (50,000)
       professional fees                                     (47,163)      (43,331)
       printing, postage and other expenses                   (9,442)       (6,595)
                                                            --------      --------

    Net cash used in operating activities                   (165,284)      (34,518)
                                                            --------      --------

    CASH FLOWS FROM INVESTING ACTIVITIES

    Investments in bonds (including accrued interest
    of $14,838)                                                           (610,910)
    Cash distributions from local partnerships                15,485         4,839
    Maturities/redemptions of bonds                                         16,782
                                                            --------      --------

    Net cash provided by (used in) investing
    activities                                                15,485      (589,289)
                                                            --------      --------

    Net decrease in cash and cash equivalents               (149,799)     (623,807)

    Cash and cash equivalents at beginning of period         543,718       873,709
                                                            --------      --------
    CASH AND CASH EQUIVALENTS AT END OF PERIOD              $393,919      $249,902
                                                            ========      ========

    SIGNIFICANT NON-CASH INVESTING ACTIVITIES

    Unrealized gain on investments in bonds, net            $ 65,465      $ 32,269
                                                            ========      ========
</TABLE>

================================================================================

See reconciliation of net loss to net cash used in operating  activities on page
6.


                       See Notes to Financial Statements.


                                       5

<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.
                     STATEMENTS OF CASH FLOWS - (Continued)
                  SIX MONTHS ENDED SEPTEMBER 29, 2001 AND 2000
                                   (UNAUDITED)

                                                          2001          2000
                                                       ---------      --------
RECONCILIATION OF NET LOSS TO NET CASH USED IN
  OPERATING ACTIVITIES

Net loss                                               $(499,906)    $(498,724)

Adjustments to reconcile net loss to net cash used
  in operating activities

  Equity in loss of investment in local
   partnerships                                          349,545       352,035
  Distributions from local partnerships classified
   as other income                                       (9,706)        (1,580)
  Amortization of net premium on investments in
   bonds                                                  2,423          4,445
  Accretion of zero coupon bonds                        (43,364)       (43,364)
  Decrease in interest receivable                           310            249
  Decrease in accounts payable and accrued expenses    (136,210)       (16,653)

  Decrease in other liabilities                          (2,200)        (4,750)
  Increase in payable to general partner and
   affiliates                                           173,824        173,824
                                                      ---------     ----------

NET CASH USED IN OPERATING ACTIVITIES                 $ (165,28)     $ (34,518)
                                                      =========      =========


                       See Notes to Financial Statements.


                                       6

<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.
                          NOTES TO FINANCIAL STATEMENTS
                               SEPTEMBER 29, 2001
                                   (UNAUDITED)

1. Basis of Presentation

   The accompanying unaudited financial statements have been prepared in
   accordance with generally accepted accounting principles for interim
   financial information. They do not include all information and footnotes
   required by generally accepted accounting principles for complete financial
   statements. The results of operations are impacted significantly by the
   combined results of operations of the Local Partnerships, which are provided
   by the Local Partnerships on an unaudited basis during interim periods.
   Accordingly, the accompanying financial statements are dependent on such
   unaudited information. In the opinion of the General Partner, the financial
   statements include all adjustments necessary to present fairly the financial
   position as of September 29, 2001 and the results of operations and cash
   flows for the interim periods presented. All adjustments are of a normal
   recurring nature. The results of operations for the three and six month
   periods ended September 29, 2001 are not necessarily indicative of the
   results that may be expected for the entire year.

   Certain prior period Local Partnership balances in Note 4 have been
   reclassified to conform to the current period presentation.


2. Investments in Bonds

   As of September 29, 2001, certain information concerning investments in bonds
   is as follows:

<TABLE>
<CAPTION>

                                                 Gross          Gross
                                 Amortized     unrealized     unrealized      Estimated
   Description and maturity         cost         gains          losses        fair value
   ------------------------      ---------     ----------     ----------      ----------

Corporate debt securities
<S>                             <C>           <C>            <C>            <C>
  Within one year               $   100,450   $       519    $      --      $   100,969
  After one year through
   five years                       997,944        47,624           --        1,045,568
  After five years through
  ten years                         504,301        33,898         (1,035)       537,164
                                -----------   -----------    -----------    -----------

                                  1,602,695        82,041         (1,035)     1,683,701
                                -----------   -----------    -----------    -----------
U.S. Treasury debt securities
  After five years through
  ten years                       1,302,856        71,544           --        1,374,400
                                -----------   -----------    -----------    -----------

                                $ 2,905,551   $   153,585    $    (1,035)   $ 3,058,101
                                ===========   ===========    ===========    ===========
</TABLE>


                                       7

<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.
                   NOTES TO FINANCIAL STATEMENTS - (Continued)
                               SEPTEMBER 29, 2001
                                   (UNAUDITED)

3. Investment in Local Partnerships

   The Partnership owns limited partnership interests in forty-three Local
   Partnerships representing capital contributions in the aggregate amount of
   $29,264,476. As of June 30, 2001, the Local Partnerships have outstanding
   mortgage loans payable totaling approximately $84,814,000 and accrued
   interest payable on such loans totaling approximately $3,401,000, which are
   secured by security interests and liens common to mortgage loans on the Local
   Partnerships' real property and other assets.

   For the six months ended September 29, 2001, the investment in local
   partnerships activity consists of the following:

      Investment in local partnerships as of March
      30, 2001                                                  $2,987,706

      Equity in loss of investment in local
      partnerships                                                (349,545)*

      Cash distributions received from Local
        Partnerships                                               (15,485)

      Cash distributions from Local Partnerships
        classified as other income                                   9,706
                                                                ----------

      Investment in local partnerships as of
      September 29, 2001                                        $2,632,382
                                                                ==========


   * Equity in loss of investment in local partnerships is limited to the
     Partnership's investment balance in each Local Partnership; any excess is
     applied to other partners' capital in any such Local Partnership. The
     amount of such excess losses applied to other partners' capital was
     $1,317,446 for the six months ended June 30, 2001 as reflected in the
     combined statement of operations of the Local Partnerships reflected herein
     Note 3.

   The combined unaudited balance sheets of the Local Partnerships as of June
   30, 2001 and December 31, 2000 and the combined unaudited statements of
   operations of the Local Partnerships for the three and six month periods
   ended June 30, 2001 and 2000 are reflected on pages 9 and 10, respectively.


                                       8
<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.
                   NOTES TO FINANCIAL STATEMENTS - (Continued)
                               SEPTEMBER 29, 2001
                                   (UNAUDITED)


3. Investment in Local Partnerships (continued)

   The combined balance sheets of the Local Partnerships as of June 30, 2001 and
   December 31, 2000 are as follows:

<TABLE>
<CAPTION>

                                                         June 30,     December 31,
                                                           2001          2000
                                                       -----------  ---------------
   ASSETS

<S>                                                  <C>             <C>
Cash and cash equivalents                            $  1,041,557    $  1,358,025
Rents receivable                                          374,559         400,684
Escrow deposits and reserves                            5,254,734       4,915,062
Land                                                    3,910,215       3,910,215

Buildings and improvements (net of accumulated
  depreciation of $41,105,542 and $39,068,817)         72,719,332      74,658,814

Intangible assets (net of accumulated amortization
  of $493,147 and $472,905)                               608,791         629,033
Other assets                                            1,044,879         948,134
                                                     ------------    ------------

                                                     $ 84,954,067    $ 86,819,967
                                                     ============    ============

LIABILITIES AND PARTNERS' EQUITY (DEFICIT)

Liabilities

  Accounts payable and accrued expenses              $    988,819    $    821,999
  Due to related parties                                4,926,883       5,021,176
  Mortgage loans                                       84,814,161      85,145,147
  Notes payable                                            23,595           9,850
  Accrued interest                                      3,400,554       3,203,151
  Other liabilities                                       667,191         644,370
                                                     ------------    ------------

                                                       94,821,203      94,845,693
                                                     ------------    ------------

Partners' equity (deficit)

  American Tax Credit Properties III L.P.
   Capital contributions, net of distributions         28,899,136      28,935,106
   Cumulative loss                                    (25,521,962)    (25,172,417)
                                                     ------------    ------------

                                                        3,377,174       3,762,689
                                                     ------------    ------------

  General partners and other limited partners
   Capital contributions, net of distributions           (242,341)       (223,032)
   Cumulative loss                                    (13,001,969)    (11,565,383)
                                                     ------------    ------------

                                                      (13,244,310)    (11,788,415)
                                                     ------------    ------------

                                                       (9,867,136)     (8,025,726)
                                                     ------------    ------------
                                                     $ 84,954,067    $ 86,819,967
                                                     ============    ============
</TABLE>


                                       9
<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.
                   NOTES TO FINANCIAL STATEMENTS - (Continued)
                               SEPTEMBER 29, 2001
                                   (UNAUDITED)

3. Investment in Local Partnerships (continued)

   The combined statements of operations of the Local Partnerships for the three
   and six month periods ended June 30, 2001 and 2000 are as follows:

<TABLE>
<CAPTION>

                                    Three            Six           Three          Six
                                    Months          Months         Months        Months
                                    Ended           Ended          Ended         Ended
                                   June 30,        June 30,       June 30,       June 30,
                                     2001            2001           2000          2000
                                  ---------      -----------    -----------    ----------
   REVENUE

<S>                              <C>            <C>            <C>            <C>
Rental                           $ 2,757,175    $ 5,448,758    $ 2,677,506    $ 5,326,814
Interest and other                    76,740        170,698        176,814        250,899
                                 -----------    -----------    -----------    -----------

TOTAL REVENUE                      2,833,915      5,619,456      2,854,320      5,577,713
                                 -----------    -----------    -----------    -----------
EXPENSES

Administrative                       550,094      1,112,899        530,000      1,097,465
Utilities                            307,311        684,360        272,495        591,411
Operating and maintenance            728,741      1,348,603        579,799      1,274,587
Taxes and insurance                  329,606        646,491        310,598        628,214
Financial                            804,190      1,556,268        821,490      1,637,187
Depreciation and amortization      1,040,021      2,056,966      1,009,799      2,019,065
                                 -----------    -----------    -----------    -----------

Total Expenses                     3,759,963      7,405,587      3,524,181      7,247,929
                                 -----------    -----------    -----------    -----------

NET LOSS                         $  (926,048)   $(1,786,131    $  (669,861)   $(1,670,216)
                                 ===========    ===========    ===========    ===========
NET LOSS ATTRIBUTABLE TO

American Tax Credit Properties
III L.P.                         $  (156,563)   $  (349,545)   $  (145,784)   $  (352,035)
General partners and other
  limited partners, which
  includes $710,695,
  $1,317,446, $537,995 and
  $1,271,669 of Partnership
  loss in excess of investment      (769,485)    (1,436,586)      (524,077)    (1,318,181)
                                 -----------    -----------    -----------    -----------

                                 $  (926,048)   $(1,786,131    $  (669,861)   $(1,670,216)
                                 ===========    ===========    ===========    ===========
</TABLE>


   The combined results of operations of the Local Partnerships for the three
   and six month periods ended June 30, 2001 are not necessarily indicative of
   the results that may be expected for an entire operating period.


4. Additional Information

   Additional information, including the audited March 30, 2001 Financial
   Statements and the Organization, Purpose and Summary of Significant
   Accounting Policies, is included in the Partnership's Annual Report on Form
   10-K for the fiscal year ended March 30, 2001 on file with the Securities and
   Exchange Commission.


                                       10
<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations
         -----------------------------------------------------------------------

Material Changes in Financial Condition
---------------------------------------

As of September 29, 2001, American Tax Credit Properties III L.P. (the
"Registrant") has not experienced a significant change in financial condition as
compared to March 30, 2001. Principal changes in assets are comprised of
periodic transactions and adjustments and anticipated equity in loss from
operations of the local partnerships (the "Local Partnerships") which own
low-income multifamily residential complexes (the "Properties") which qualify
for the low-income tax credit in accordance with Section 42 of the Internal
Revenue Code (the "Low-income Tax Credit"). During the six months ended
September 29, 2001, Registrant received cash from interest revenue and
distributions from local partnerships and utilized cash for operating expenses.
Cash and cash equivalents and investments in bonds decreased, in the aggregate,
by approximately $43,000 during the six months ended September 29, 2001 (which
includes a net unrealized gain on investments in bonds of approximately $65,000,
amortization of net premium on investments in bonds of approximately $2,000 and
accretion of zero coupon bonds of approximately $43,000). Notwithstanding
circumstances that may arise in connection with the Properties, Registrant does
not expect to realize significant gains or losses on its investments in bonds,
if any. During the six months ended September 29, 2001, the investment in local
partnerships decreased as a result of Registrant's equity in the Local
Partnerships' net loss for the six months ended June 30, 2001 of $349,545 and
cash distributions received from Local Partnerships of $5,779 (exclusive of
distributions of $9,706 classified as other income). Accounts payable and
accrued expenses includes deferred administration fees of $1,020,673 and payable
to general partner and affiliates represents deferred management and
administration fees in the accompanying balance sheet as of September 29, 2001.

Results of Operations
---------------------

Registrant's operating results are dependent upon the operating results of the
Local Partnerships and are significantly impacted by the Local Partnerships'
policies. In addition, the operating results herein are not necessarily the same
for tax reporting. Registrant accounts for its investment in local partnerships
in accordance with the equity method of accounting. Accordingly, the investment
is carried at cost and is adjusted for Registrant's share of each Local
Partnership's results of operations and by cash distributions received. Equity
in loss of each investment in Local Partnership allocated to Registrant is
recognized to the extent of Registrant's investment balance in each Local
Partnership. Equity in loss in excess of Registrant's investment balance in a
Local Partnership is allocated to other partners' capital in any such Local
Partnership. As a result, the reported equity in loss of investment in local
partnerships is expected to decrease as Registrant's investment balances in the
respective Local Partnerships become zero. The combined statements of operations
of the Local Partnerships reflected in Note 3 to Registrant's financial
statements include the operating results of all Local Partnerships, irrespective
of Registrant's investment balances.

Cumulative losses and cash distributions in excess of investment in local
partnerships may result from a variety of circumstances, including a Local
Partnership's accounting policies, subsidy structure, debt structure and
operating deficits, among other things. Accordingly, cumulative losses and cash
distributions in excess of the investment are not necessarily indicative of
adverse operating results of a Local Partnership. See discussion below under
Local Partnership Matters regarding certain Local Partnerships currently
operating below economic break even levels.

Registrant's operations for the three months ended September 29, 2001 and 2000
resulted in net losses of $236,247 and $219, 738, respectively. The Local
Partnerships' net loss of approximately $926,000 for the three months ended June
30, 2001 was attributable to rental and other revenue of approximately
$2,834,000, exceeded by operating and interest expense (including interest on
non-mandatory debt) of approximately $2,720,000 and approximately $1,040,000 of
depreciation and amortization expense. The Local Partnerships' net loss of
approximately $670,000 for the three months ended June 30, 2000 was attributable
to rental and other revenue of approximately $2,854,000, exceeded by operating
and interest expense (including interest on non-mandatory debt) of approximately
$2,514,000 and approximately $1,010,000 of depreciation and amortization
expense. The results of operations of the Local Partnerships for the three
months ended June 30, 2001 are not necessarily indicative of the results that
may be expected in future periods.

Registrant's operations for the six months ended September 29, 2001 and 2000
resulted in net losses of $499,906 and $498,724, respectively. The Local
Partnerships' net loss of approximately $1,786,000 for the six months ended June
30, 2001 was attributable to rental and other revenue of approximately
$5,619,000, exceeded by operating and interest expense (including interest on
non-mandatory debt) of approximately $5,348,000 and approximately $2,057,000 of
depreciation and

                                       11
<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations (continued)
         -----------------------------------------------------------------------

amortization expense. The Local Partnerships' net loss of approximately
$1,670,000 for the six months ended June 30, 2000 was attributable to rental and
other revenue of approximately $5,578,000, exceeded by operating and interest
expense (including interest on non-mandatory debt) of approximately $5,229,000
and approximately $2,019,000 of depreciation and amortization expense. The
results of operations of the Local Partnerships for the six months ended June
30, 2001 are not necessarily indicative of the results that may be expected in
future periods.

Local Partnership Matters
-------------------------

Registrant's primary objective is to provide Low-income Tax Credits to limited
partners generally over a ten year period. The relevant state tax credit agency
has allocated each of Registrant's Local Partnerships an amount of Low-income
Tax Credits, which are generally available for a ten year period from the year
the Property is placed in service (the "Ten Year Credit Period"). The Ten Year
Credit Period is expected to be fully exhausted by the Local Partnerships as of
December 31, 2003. The required holding period of each Property, in order to
avoid Low-income Tax Credit recapture, is fifteen years from the year in which
the Low-income Tax Credits commence on the last building of the Property (the
"Compliance Period"). In addition, certain of the Local Partnerships have
entered into agreements with the relevant state tax credit agencies whereby the
Local Partnerships must maintain the low-income nature of the Properties for a
period which exceeds the Compliance Period, regardless of any sale of the
Properties by the Local Partnerships after the Compliance Period. The Properties
must satisfy various requirements including rent restrictions and tenant income
limitations (the "Low-income Tax Credit Requirements") in order to maintain
eligibility for the recognition of the Low-income Tax Credit at all times during
the Compliance Period. Once a Local Partnership has become eligible for the
Low-income Tax Credit, it may lose such eligibility and suffer an event of
recapture if its Property fails to remain in compliance with the Low-income Tax
Credit Requirements. Through December 31, 2000, none of the Local Partnerships
have suffered an event of recapture of Low-income Tax Credits.

The Properties are principally comprised of subsidized and leveraged low-income
multifamily residential complexes located throughout the United States and
Puerto Rico. Many of the Local Partnerships receive rental subsidy payments,
including payments under Section 8 of Title II of the Housing and Community
Development Act of 1974 ("Section 8"). The subsidy agreements expire at various
times during and after the Compliance Periods of the Local Partnerships. Since
October 1997, the United States Department of Housing and Urban Development
("HUD") has issued a series of directives related to project based Section 8
contracts that define owners' notification responsibilities, advise owners of
project based Section 8 properties of what their options are regarding the
renewal of Section 8 contracts, provide guidance and procedures to owners,
management agents, contract administrators and HUD staff concerning renewal of
Section 8 contracts, provide policies and procedures on setting renewal rents
and handling renewal rent adjustments and provide the requirements and
procedures for opting-out of a Section 8 project based contract. Registrant
cannot reasonably predict legislative initiatives and governmental budget
negotiations, the outcome of which could result in a reduction in funds
available for the various federal and state administered housing programs
including the Section 8 program. Such changes could adversely affect the future
net operating income and debt structure of any or all Local Partnerships
currently receiving such subsidy or similar subsidies. One Local Partnership's
Section 8 contracts are currently subject to renewal under applicable HUD
guidelines.

The Local Partnerships have various financing structures which include (i)
required debt service payments ("Mandatory Debt Service") and (ii) debt service
payments which are payable only from available cash flow subject to the terms
and conditions of the notes, which may be subject to specific laws, regulations
and agreements with appropriate federal and state agencies ("Non-Mandatory Debt
Service or Interest"). In the event rents are not sufficient to cover operating
expenses, Mandatory Debt Service requirements and other charges, certain general
partners of the Local Partnerships (the "Local General Partners") are obligated
to provide advances to cover deficits for a certain period of time up to certain
amounts (the "Deficit Guarantee"). A Local General Partner's funding of such
Deficit Guarantee is dependent on its liquidity or ability to borrow the
required funds. During the six months ended June 30, 2001, revenue from
operations of the Local Partnerships has generally been sufficient to cover
operating expenses and Mandatory Debt Service. Substantially all of the Local
Partnerships are effectively operating at or above break even levels, although
certain Local Partnerships' operating information reflects operating deficits
that do not represent cash deficits due to their mortgage and financing
structure and the required deferral of property management fees. However, as
discussed below, certain Local Partnerships' operating information indicates an
operating deficit after taking into account their mortgage and financing
structure and any required deferral of property management fees.


                                       12
<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations (continued)
         -----------------------------------------------------------------------

The terms of the partnership agreement of Westminster Apartments Limited
Partnership ("Westminster") require the Local General Partner to advance funds
to cover operating deficits through the Compliance Period. As of June 30, 2001,
Westminster was in default under the terms of its first mortgage. Effective
October 2001, a workout agreement was reached, under which all arrearages were
added to the mortgage balance and all future payments are only due to the extent
of the net cash flow of the property. Westminster incurred an operating deficit
of approximately $14,000 for the six months ended June 30, 2001, which amount
includes a provision for replacement reserve deposits of $1,184 per month, but
which does not include a provision for any debt service. Registrant's investment
balance in Westminster, after cumulative equity losses, became zero during the
year ended March 30, 1999. Westminster will have generated approximately $6.3
per Unit per year to the limited partners upon the expiration of its Low-income
Tax Credit allocation in 2003.

Fulton Street Houses Limited Partnership ("Fulton Street") has an escrow of
approximately $344,000 as of June 30, 2001 to cover operating deficits and there
are no Mandatory Debt Service payments or real estate taxes required during the
Compliance Period. Fulton Street incurred an operating deficit of approximately
$25,000 for the six months ended June 30, 2001. Fulton Street will have
generated approximately $11.7 per Unit per year to the limited partners upon the
expiration of its Low-income Tax Credit allocation in 2001.

The terms of the partnership agreement of Sydney Engel Associates L.P. ("Sydney
Engel") require the Local General Partners to advance funds to cover operating
deficits up to $1,000,000 through April 2002 and to cause the management agent
to defer property management fees in order to avoid a default under the
mortgage. Sydney Engel incurred an operating deficit of approximately $159,000
for the six months ended June 30, 2001, which includes property management fees
of approximately $43,000. Payments on the mortgage are current; the Property
does not incur real estate taxes. Sydney Engel withdrew approximately $61,000
from its operating reserve during the six months ended June 30, 2001. Such
reserve has a balance of approximately $183,000 as of June 30, 2001.
Registrant's investment balance in Sydney Engel, after cumulative equity losses,
became zero during the year ended March 30, 1997. Sydney Engel will have
generated approximately $14.5 per Unit per year to the limited partners upon the
expiration of its Low-income Tax Credit allocation in 2001.

The terms of the partnership agreement of Orange City Plaza Limited Partnership
("Orange City") require the Local General Partner to advance funds to cover
operating deficits through the Compliance Period and to cause the management
agent to defer property management fees in order to avoid a default under the
mortgage. Orange City incurred an operating deficit of approximately $10,000 for
the six months ended June 30, 2001, which includes property management fees of
approximately $3,000. Payments on the mortgage and real estate taxes are
current. Orange City will have generated approximately $2.5 per Unit per year to
the limited partners upon the expiration of its Low-income Tax Credit allocation
in 2001.


Item 3.  Quantitative and Qualitative Disclosure about Market Risk
         ---------------------------------------------------------

Registrant has invested a significant portion of its working capital reserves in
corporate bonds and U.S. Treasury instruments. The market value of such
investments is subject to fluctuation based upon changes in interest rates
relative to each investment's maturity date. Since Registrant's investments in
bonds have various maturity dates through 2008, the value of such investments
may be adversely impacted in an environment of rising interest rates in the
event Registrant decides to liquidate any such investment prior to its maturity.
Although Registrant may utilize reserves to assist an under performing Property,
it otherwise intends to hold such investments to their respective maturities.
Therefore, Registrant does not anticipate any material adverse impact in
connection with such investments.


                                       13
<PAGE>

                     AMERICAN TAX CREDIT PROPERTIES III L.P.

                           Part II - OTHER INFORMATION
                                     -----------------

Item 1.   Legal Proceedings
          -----------------

          Registrant is not aware of any material legal proceedings.

Item 2.   Changes in Securities
          ---------------------

          None

Item 3.   Defaults Upon Senior Securities
          -------------------------------

          None

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

          None

Item 5.   Other Information
          -----------------

          None

Item 6.   Exhibits and Reports on Form 8-K
          --------------------------------

          None


                                       14
<PAGE>

                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.


                                    AMERICAN TAX CREDIT PROPERTIES III L.P.
                                    (a Delaware limited partnership)

                                    By:  Richman Tax Credit Properties III L.P.,
                                         General Partner

                                    By:  Richman Housing Credits Inc.,
                                         general partner


Dated: November 13, 2001            /s/ Richard Paul Richman
                                    -----------------------------------------
                                    by: Richard Paul Richman
                                        President, Chief Executive
                                        Officer and Director of the
                                        general partner of the
                                        General Partner


Dated: November 13, 2001            /s/ Neal Ludeke
                                    -----------------------------------------
                                    by: Neal Ludeke
                                        Vice President and
                                        Treasurer of the general partner
                                        of the General Partner
                                        (Principal Financial and Accounting
                                        Officer of Registrant)


                                       15