UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

**FORM N-Q**

**QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED**

**MANAGEMENT INVESTMENT COMPANY**

**_______________________________**

Investment Company Act file number  811-4049

DWS Income Trust

(Exact name of registrant as specified in charter)

 

345 Park Avenue

New York, NY  10154

(Address of principal executive offices)             (Zip code)

 

Paul Schubert

345 Park Avenue

New York, NY  10154-0004

(Name and address of agent for service)

Registrant's telephone number, including area code:  (212) 454-7190

Date of fiscal year end:  09/30

Date of reporting period: 6/30/09

 

ITEM 1.  SCHEDULE OF INVESTMENTS

| Investment Portfolio                                        **as of****June 30, 2009  (Unaudited)**

 

 

**DWS GNMA Fund**

 

  | **Principal****Amount ($)** |   | **Value ($)** |  
 

 

**Government National Mortgage Association 80.4%**

 
Government National Mortgage Association:

 
 

2.898%, 4/20/2059  

 

 

34,066,523 

 

35,120,456 

 
 

4.5%, 10/1/2038 (a)

 

 

30,000,000 

 

29,934,375 

 
 

5.0%, with various maturities from 11/15/2032 until 6/20/2039 (a) (b) 

 

 

314,155,405 

 

321,349,959 

 
 

5.5%, with various maturities from 7/20/2013 until 6/15/2039 (a) (b) 

 

 

525,113,852 

 

545,376,815 

 
 

6.0%, with various maturities from 7/15/2014 until 5/15/2039 (a) (b) 

 

 

577,256,211 

 

605,916,850 

 
 

6.5%, with various maturities from 6/15/2023 until 2/15/2039 

 

 

122,177,042 

 

116,261,556 

 
 

7.0%, with various maturities from 9/15/2009 until 11/20/2038 (b) 

 

 

84,105,171 

 

90,697,170 

 
 

7.5%, with various maturities from 2/15/2011 until 1/15/2037 

 

 

29,814,739 

 

32,546,887 

 
 

8.0%, with various maturities from 8/20/2012 until 9/20/2013 

 

 

67,530 

 

71,958 

 
 

9.0%, with various maturities from 2/15/2020 until 7/15/2030 

 

 

1,091,275 

 

1,236,234 

 
 

10.5%, with various maturities from 10/20/2016 until 1/20/2021 

 

 

359,774 

 

416,094 

 
 

11.5%, with various maturities from 4/15/2013 until 2/15/2016 

 

 

81,782 

 

93,479 

 
 

12.0%, with various maturities from 12/15/2012 until 7/15/2015 

 

 

298,462 

 

345,444 

 
 

 

 

 

12.5%, with various maturities from 10/15/2013 until 8/15/2015 

 

 

153,018 

 

175,713 

 
 

13.0%, 5/15/2015  

 

 

4,780 

 

5,567 

 
 

13.5%, with various maturities from 11/15/2012 until 9/15/2014 

 

 

25,645 

 

29,908 

 
 

14.0%, 7/15/2011  

 

 

10,428 

 

11,167 

 
 

14.5%, 10/15/2014  

 

 

17,084 

 

20,236 

 
**Total Government National Mortgage Association** (Cost $1,741,700,524)

 

**1,779,609,868**

 
 

**Collateralized Mortgage Obligations 15.3%**

 
Fannie Mae Whole Loan, "1A8", Series 2003-W12, 4.55%, 6/25/2043  

 

 

12,306,290 

 

12,529,342 

 
Federal Home Loan Mortgage Corp.:

 
 

"AF", Series 2892, 0.619% *, 5/15/2021  

 

 

3,135,324 

 

3,140,520 

 
 

"FO", Series 2418, 1.219% *, 2/15/2032  

 

 

3,650,738 

 

3,703,787 

 
 

"GF", Series 2412, 1.269% *, 2/15/2032  

 

 

5,812,853 

 

5,891,141 

 
 

"FA", Series 2419, 1.319% *, 2/15/2032  

 

 

3,354,623 

 

3,402,925 

 
 

"F", Series 2439, 1.319% *, 3/15/2032  

 

 

3,982,351 

 

4,035,899 

 
 

"FA", Series 2436, 1.319% *, 3/15/2032  

 

 

3,982,351 

 

4,036,108 

 
 

"FQ", Series 2488, 1.319% *, 3/15/2032  

 

 

4,064,385 

 

4,119,250 

 
 

"FD", Series 3519, 1.769% *, 2/15/2038  

 

 

16,434,847 

 

16,787,361 

 
 

"BI", Series 3499, Interest Only, 4.0%, 9/15/2021  

 

 

2,402,754 

 

186,511 

 
 

"57", Series 256, Interest Only, 5.0%, 3/15/2023  

 

 

8,207,077 

 

1,079,249 

 
 

"GZ", Series 2906, 5.0%, 9/15/2034  

 

 

21,539,898 

 

19,918,775 

 
 

"TZ", Series 2778, 6.0%, 2/15/2034  

 

 

2,724,745 

 

2,861,702 

 
 

"SL", Series 2882, Interest Only, 6.881% **, 10/15/2034  

 

 

5,229,152 

 

560,347 

 
Federal National Mortgage Association:

 
 

"FC", Series 2006-123, 0.574% *, 1/25/2037  

 

 

5,463,054 

 

5,322,626 

 
 

"OF", Series 2001-60, 1.264% *, 10/25/2031  

 

 

1,659,071 

 

1,685,940 

 
 

"OF", Series 2001-70, 1.264% *, 10/25/2031  

 

 

663,628 

 

672,495 

 
 

"FB", Series 2002-30, 1.314% *, 8/25/2031  

 

 

4,604,031 

 

4,675,893 

 
 

"FA", Series 2003-11, 1.314% *, 9/25/2032  

 

 

3,758,879 

 

3,812,054 

 
 

"FJ", Series 2002-52, 1.314% *, 9/25/2032  

 

 

4,944,210 

 

5,016,537 

 
 

"25", Series 351, Interest Only, 4.5%, 5/1/2019  

 

 

7,578,000 

 

968,700 

 
 

"21", Series 334, Interest Only, 5.0%, 3/1/2018  

 

 

8,648,105 

 

973,550 

 
 

"20", Series 334, Interest Only, 5.0%, 3/1/2018  

 

 

6,979,923 

 

785,372 

 
 

''23", Series 339, Interest Only, 5.0%, 7/1/2018  

 

 

6,094,922 

 

686,170 

 
 

"ZA", Series 2008-24, 5.0%, 4/25/2038  

 

 

15,965,344 

 

14,415,762 

 
 

"AN", Series 2007-108, 8.844% *, 11/25/2037  

 

 

14,305,878 

 

14,937,587 

 
Government National Mortgage Association:

 
 

"CO", Series 2002-76, Principal Only, Zero Coupon, 3/22/2032  

 

 

2,568,239 

 

1,792,045 

 
 

"FN", Series 2007-51, 0.735% *, 8/20/2037  

 

 

2,522,973 

 

2,424,466 

 
 

"FP", Series 2003-67, 1.215% *, 8/20/2033  

 

 

14,971,875 

 

15,148,036 

 
 

"PZ", Series 2004-74, 4.0%, 9/20/2034  

 

 

3,626,603 

 

3,317,754 

 
 

"ZC", Series 2003-86, 4.5%, 10/20/2033  

 

 

2,257,231 

 

2,083,977 

 
 

"A1", Series 2008-36, Interest Only, 5.0%, 10/16/2022  

 

 

11,342,269 

 

851,744 

 
 

"KE", Series 2004-19, 5.0%, 3/16/2034  

 

 

5,000,000 

 

4,790,822 

 
 

"PH", Series 2004-80, 5.0%, 7/20/2034  

 

 

11,000,000 

 

11,035,529 

 
 

"LE", Series 2004-87, 5.0%, 10/20/2034  

 

 

7,000,000 

 

6,593,505 

 
 

"ZB", Series 2005-15, 5.0%, 2/16/2035  

 

 

12,413,711 

 

11,677,959 

 
 

"GZ", Series 2005-44, 5.0%, 7/20/2035  

 

 

3,647,488 

 

3,379,122 

 
 

"CK", Series 2007-31, 5.0%, 5/16/2037  

 

 

9,000,000 

 

8,873,176 

 
 

"Z", Series 2009-49, 5.15%, 6/16/2049 (a)

 

 

5,045,000 

 

4,302,833****

 
 

"AI", Series 2008-77, Interest Only, 5.5%, 10/20/2020  

 

 

3,242,611 

 

81,949 

 
 

"AI", Series 2008-40, Interest Only, 5.5%, 5/16/2023  

 

 

4,827,335 

 

527,312 

 
 

"AI", Series 2008-46, Interest Only, 5.5%, 5/16/2023  

 

 

4,360,491 

 

567,401 

 
 

"AI", Series 2008-51, Interest Only, 5.5%, 5/16/2023  

 

 

13,911,063 

 

1,741,075 

 
 

"PC", Series 2003-19, 5.5%, 3/16/2033  

 

 

8,000,000 

 

8,259,227 

 
 

 

 

 

"PZ" Series 2003-25, 5.5%, 4/20/2033  

 

 

7,013,450 

 

7,109,808 

 
 

"TZ", Series 2003-85, 5.5%, 10/20/2033  

 

 

6,823,636 

 

6,689,357 

 
 

"PI", Series 2004-28, Interest Only, 5.5%, 11/20/2033  

 

 

4,009,648 

 

353,096 

 
 

"PC", Series 2007-2, 5.5%, 6/20/2035  

 

 

11,510,346 

 

11,939,489 

 
 

"Z", Series 2005-96, 5.5%, 12/16/2035  

 

 

7,905,231 

 

7,730,306 

 
 

"PD", Series 2005-91, 5.5%, 12/20/2035  

 

 

5,000,000 

 

5,121,849 

 
 

"ZA", Series 2007-30, 5.5%, 5/16/2037  

 

 

5,625,743 

 

5,463,414 

 
 

"IJ", Series 2007-53, Interest Only, 5.75%, 6/20/2035  

 

 

1,144,635 

 

70,925 

 
 

"SF", Series 2002-63, Interest Only, 5.962% **, 9/16/2032  

 

 

5,501,503 

 

383,624 

 
 

"ZB", Series 2005-65, 6.0%, 9/20/2032  

 

 

17,683,881 

 

18,770,632 

 
 

"PH" Series 2002- 84, 6.0%, 11/16/2032  

 

 

9,000,000 

 

9,379,003 

 
 

"CI", Series 2009-42, Interest Only, 6.0%, 8/16/2035  

 

 

1,151,810 

 

172,772 

 
 

"CT", Series 2009-42, 6.0%, 8/16/2035  

 

 

13,821,731 

 

14,357,863 

 
 

"PB", Series 2005-92, 6.0%, 12/20/2035  

 

 

8,000,000 

 

8,050,173 

 
 

"PS", Series 2008-40, Interest Only, 6.182% **, 5/16/2038  

 

 

6,562,989 

 

581,611 

 
 

"IO", Series 2006-61, Interest Only, 6.5%, 11/20/2036  

 

 

10,011,379 

 

1,610,233 

 
 

"DI", Series 2008-93, Interest Only, 6.5%, 9/20/2038  

 

 

24,130,616 

 

3,993,409 

 
 

"KS", Series 2004-96, Interest Only, 6.685% **, 7/20/2034  

 

 

12,526,557 

 

1,125,385 

 
 

"SY", Series 2004-47, Interest Only, 6.742% **, 1/16/2034  

 

 

13,952,483 

 

1,186,112 

 
 

"LS", Series 2003-74, Interest Only, 6.835% **, 12/20/2030  

 

 

2,286,021 

 

125,895 

 
 

"SN", Series 2005-68, Interest Only, 6.882% **, 1/17/2034  

 

 

28,061,205 

 

2,082,040 

 
 

"SU", Series 2004-30, Interest Only, 6.885% **, 2/20/2032  

 

 

15,182,497 

 

827,369 

 
 

"ST", Series 2004-71, 7.0%, 9/20/2034  

 

 

5,151,030 

 

5,199,371 

 
 

"SM", Series 2003-60, Interest Only, 7.432% **, 1/16/2033  

 

 

23,868,151 

 

2,198,491 

 
 

"SJ", Series 1999-43, Interest Only, 7.682% **, 11/16/2029  

 

 

7,136,581 

 

853,287 

 
 

"QA", Series 2002-13, Interest Only, 7.732% **, 2/16/2032  

 

 

2,435,748 

 

319,667 

 
**Total Collateralized Mortgage Obligations** (Cost $325,486,373)

 

**339,348,716**

 
 

**US Government Agency Sponsored Pass-Throughs 0.3%**

 
Federal Home Loan Mortgage Corp., 7.0%, 10/1/2038 

 

 

5,978,190 

 

6,484,702 

 
Federal National Mortgage Association, 7.0%, 7/1/2037 

 

 

1,202,423 

 

1,307,870 

 
**Total US Government Agency Sponsored Pass-Throughs** (Cost $7,680,250)

 

**7,792,572**

 
 

**Government & Agency Obligations 9.3%**

 
**Other Government Related 0.9%**

 
Citibank NA, FDIC Guaranteed, 1.875%, 5/7/2012 

 

 

20,000,000 

 

**19,921,900**

 
**US Government Sponsored Agencies 6.3%**

 
Federal Home Loan Bank:

 
 

1.375%, 5/16/2011 (c)

 

 

9,520,000 

 

9,549,331 

 
 

1.625%, 7/27/2011 (b)

 

 

10,500,000 

 

10,557,771 

 
 

1.875%, 6/20/2012  

 

 

21,000,000 

 

20,971,041 

 
 

7.2% *, 3/18/2024  

 

 

5,880,000 

 

5,394,900 

 
 

7.45% *, 10/16/2023 (c)

 

 

12,000,000 

 

11,760,000 

 
Federal Home Loan Mortgage Corp.:

 
 

1.5%, 1/7/2011 (c)

 

 

10,000,000 

 

10,087,550 

 
 

1.75%, 6/15/2012  

 

 

10,825,000 

 

10,785,640 

 
 

8.25% *, 6/17/2024  

 

 

5,000,000 

 

4,950,000 

 
Federal National Mortgage Association:

 
 

1.288% *, 2/27/2023 (c)

 

 

25,000,000 

 

24,750,000 

 
 

1.875%, 4/20/2012  

 

 

11,430,000 

 

11,476,475 

 
 

5.0%, 5/20/2024  

 

 

20,000,000 

 

19,690,680 

 
 

**139,973,388**

 
**US Treasury Obligations 2.1%**

 
US Treasury Bills:

 
 

 

 

 

0.15% ***, 9/17/2009 (d)

 

 

8,167,000 

 

8,163,782 

 
 

0.158% ***, 8/27/2009 (d)

 

 

527,000 

 

526,882 

 
 

0.24% ***, 7/9/2009 (d)

 

 

1,064,000 

 

1,063,980 

 
US Treasury Note, 4.875%, 4/30/2011 (b) 

 

 

33,000,000 

 

35,279,046 

 
 

**45,033,690**

 
**Total Government & Agency Obligations** (Cost $206,390,445)

 

**204,928,978**

 
 

**Shares**

 

**Value ($)**

 
 

**Securities Lending Collateral 15.4%**

 
Daily Assets Fund Institutional, 0.48% (e) (f)(Cost $340,466,065)

 

 

340,466,065

 

**340,466,065**

 
 

**Cash Equivalents 7.8%**

 
Cash Management QP Trust, 0.27% (e)(Cost $172,205,400)

 

 

172,205,400

 

**172,205,400**

 
 

**% of****Net Assets**

 

**Value ($)**

 
**Total Investment Portfolio** (Cost $2,793,929,057) †

128.5

 

**2,844,351,599**

 
**Other Assets and Liabilities, Net**

(28.5)

 

**(631,266,072)**

 
**Net Assets**

100.0

 

**2,213,085,527**

 
*For information on the Fund's policies regarding the valuation of investments and other significant accounting policies, please refer to the Fund's most recent semi-annual or annual financial statements.*

 
***

*Floating rate notes are securities whose yields vary with a designated market index or market rate, such as the coupon-equivalent of the US Treasury bill rate.  These securities are shown at their current rate as of June 30, 2009.*

 
****

*These securities are shown at their current rate as of June 30, 2009.*

 
*****

*Annualized yield at time of purchase; not a coupon rate.*

 
*†*

*The cost for federal income tax purposes was $2,794,156,563.  At June 30, 2009, net unrealized appreciation for all securities based on tax cost was $50,195,036.  This consisted of aggregate gross unrealized appreciation for all securities in which there was an excess of value over tax cost of $54,753,595 and aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over value of $4,558,559.*

 
*(a)*

*When-issued or delayed delivery security included.*

 
*(b)*

*All or a portion of these securities were on loan. The value of all securities loaned at June 30, 2009 amounted to $334,428,106 which is 15.1% of net assets.*

 
*(c)*

*At June 30, 2009 this security has been pledged, in whole or in part, as collateral for open written options.*

 
*(d)*

*At June 30, 2009, this security has been pledged, in whole or in part, to cover initial margin requirements for open futures contracts.*

 
*(e)*

*Affiliated fund managed by Deutsche Investment Management Americas Inc.  The rate shown is the annualized seven-day yield at period end.*

 
*(f)*

*Represents collateral held in connection with securities lending.  Income earned by the Fund is net of borrower rebates.*

 
*FDIC: Federal Deposit Insurance Corp.*

 
*Interest Only: Interest Only (IO) bonds represent the "interest only" portion of payments on a pool of underlying mortgages or mortgage-backed securities. IO securities are subject to prepayment risk of the pool of underlying mortgages.*

 
*Principal Only: Principal Only (PO) bonds represent the “principal only” portion of payments on a pool of underlying mortgages or mortgage-backed securities.*

 
*Included in the portfolio are investments in mortgage or asset-backed securities which are interests in separate pools of mortgages or assets.  Effective maturities of these investments may be shorter than stated maturities due to prepayments.  Some separate investments in the Government National Mortgage Association issues which have similar coupon rates have been aggregated for presentation purposes in this investment portfolio.*

 
*At June 30, 2009, open futures contracts sold were as follows:*

 
 

 

 

**Futures**

 

 

**Expiration****Date**

 

**Contracts**

 

**Aggregated****Face****Value ($)**

 

**Value ($)**

 

**Unrealized****Appreciation/****(Depreciation) ($)**

 
 

 
10-Year US Treasury Note 

 

9/21/2009 

 

170 

 

19,802,336 

 

19,765,156 

 

37,180

 
2-Year US Treasury Note 

 

9/30/2009 

 

435 

 

93,504,610 

 

94,055,156 

 

(550,546)

 
**Total net unrealized depreciation**

**(513,366)**

 
*At June 30, 2009, open written option contracts were as follows:*

 
**Written Options**

 

**Coupon****Rate (%)**

 

**Contracts****Amount**

 

**Expiration****Date**

 

**Strike****Price ($)**

 

**Value ($)***

 
**Call Options**

 
30-Year GNSF 

 

5.5

 

30,000,000 

 

7/13/2009 

 

102.2

 

403,125 

 
30-Year GNSF 

 

5.0

 

30,000,000 

 

7/13/2009 

 

100.3

 

576,562 

 
**Total Call Options (Premiums received $515,625)**

 

**979,687**

 
**Put Options**

 
30-Year GNSF 

 

4.5

 

60,000,000 

 

7/13/2009 

 

101.3

 

909,375 

 
30-Year GNSF 

 

5.5

 

30,000,000 

 

7/13/2009 

 

102.0

 

42,188 

 
30-Year GNSF 

 

5.0

 

30,000,000 

 

7/13/2009 

 

101.6

 

121,875 

 
30-Year GNSF 

 

4.5

 

30,000,000 

 

7/13/2009 

 

99.8

 

196,875 

 
30-Year GNSF 

 

5.0

 

30,000,000 

 

8/13/2009 

 

101.3

 

253,125 

 
30-Year GNSF 

 

5.0

 

30,000,000 

 

9/14/2009 

 

99.3

 

205,077 

 
30-Year GNSF 

 

5.0

 

30,000,000 

 

7/13/2009 

 

100.1

 

37,500 

 
30-Year GNSF 

 

5.5

 

30,000,000 

 

9/14/2009 

 

101.4

 

158,202 

 
30-Year GNSF 

 

5.0

 

30,000,000 

 

8/13/2009 

 

103.0

 

501,563 

 
30-Year GNSF 

 

5.5

 

30,000,000 

 

8/13/2009 

 

102.7

 

206,250 

 
30-Year GNSF 

 

5.0

 

30,000,000 

 

8/13/2009 

 

102.0

 

384,678 

 
30-Year GNSF 

 

6.0

 

30,000,000 

 

8/13/2009 

 

103.8

 

173,438 

 
30-Year GNSF 

 

5.5

 

30,000,000 

 

8/13/2009 

 

102.8

 

210,937 

 
30-Year GNSF 

 

6.0

 

30,000,000 

 

8/13/2009 

 

103.6

 

154,687 

 
**Total Put Options (Premiums received $3,669,141)**

 

**3,555,770**

 
**Total Written Options (Premiums received $4,184,766)**

 

**4,535,457**

 
***

*Unrealized depreciation at June 30, 2009 was $350,691.*

 
*GNSF: Government National Single Family*

 
 

 

 

 

 

***Fair Value Measurements***

 

*Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, “Fair Value Measurements,” as amended, establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value measurements.*

 

*Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.*

 

*The following is a summary of the inputs used as of June 30, 2009 in valuing the Fund's investments:*

 

**Level 1**

**Level 2**

**Level 3**

**Total**

**Assets**

 

 

 

 

 

 

 

Fixed Income (g)

 

 

 

 

 
Government National Mortgage Association

$                       —

$     1,779,609,868

$                         —

$      1,779,609,868

 
Collateralized Mortgage Obligations

—

335,045,883

4,302,833

339,348,716

 
US Government Agency Sponsored Pass-Throughs

—

7,792,572

—

7,792,572

 
Government & Agency Obligations

—

173,069,434

22,104,900

195,174,334

 
Short-Term Investments (g)

340,466,065

181,960,044

—

522,426,109 

 
**Total**

**$       340,466,065**

**$    2,477,477,801**

**$           26,407,733**

**$      2,844,351,599**

 
 
 

 
**Liabilities**

 

 

 

 

 
Derivatives (h)

(513,366)

—

(4,535,457)

(5,048,823)

 
**Total**

**$           (513,366)**

**$**      —    

**$           (4,535,457)**

**$           (5,048,823)**

 
 
*(g)*

*See Investment Portfolio for additional detailed categorizations.*

 
*(h)*

*Derivatives include unrealized appreciation (depreciation) on futures contracts and options written, at value.*

 

*The following is a reconciliation of the Fund's Level 3 investments for which significant unobservable inputs were used in determining the value:*

 

**Government & Agency Obligations**

**Written Options**

**Balance as of  September 30, 2008**

$                  12,000,000                         

$                  (2,129,688)                         

**Realized gains (loss)**

—

2,746,094

**Change in unrealized appreciation (depreciation)**

(725,100)

(1,088,973) 

**Amortization premium/ discount**

—

—

**Net purchases (sales)**

15,132,833

(4,062,890)

**Net transfers in (out) of Level 3**

— 

— 

**Balance as of  June 30, 2009**

**26,407,733**

**(4,535,457)**

**Net change in unrealized appreciation (depreciation) from investments still held at  June 30, 2009**

**$                  (725,100)**

**$                    (350,691)**

 

***Derivative Instruments and Hedging Activities***

 

*Financial Accounting Standards Board Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities,” requires enhanced disclosure about an entity’s derivative and hedging activities.*

 

*The following is a summary of the unrealized appreciation (depreciation) of the Fund's derivative instruments categorized by risk exposure as of June 30, 2009. Please see below for information on the Fund’s policy regarding the objectives and strategies for using futures and options.*

 

 

 

**Primary Underlying Risk Disclosure**

 

 

**Futures**

**Written Options**

Interest Rate Contracts

$        (513,366)

$       (350,691)

 

*Futures.  The value of the Fund's underlying bond investments are subject to interest rate risk.  As interest rates increase, the value of the Fund's fixed rate bonds may fall.  The Fund may enter into interest rate futures to gain exposure to different parts of the yield curve while managing overall duration.  Upon entering into futures contract, the Fund is required to deposit with a financial intermediary an initial margin equal to a certain percentage of the face value indicated in the futures contract.  Subsequent payments (“variation margin”) are made or received by the fund dependent upon the daily fluctuations in the value of the underlying security.   Since all futures contracts are exchange traded, counterparty risk is minimized as the exchange's clearinghouse acts as the counterparty, and guarantees the futures against default.*

 

*Options.  The Fund may enter into options on interest rate swaps and options on GNMA TBA’s to enhance potential gain. If the Fund writes a covered call option, the Fund foregoes, in exchange for the premium, the opportunity to profit during the option period from an increase in the market value of the underlying security above the exercise price. If the Fund writes a put option it accepts the risk of a decline in the* *market value of the underlying security below the exercise price. Over-the-counter options have the risk of the*

 

*potential inability of counterparties to meet the terms of their contracts.  For exchange traded contracts the counterparty risk is minimized as the exchange's clearinghouse acts as the counterparty, and guarantees the futures against default.  The Fund's maximum exposure to purchased options is limited to the premium initially paid.*

 

**ITEM 2.**

**CONTROLS AND PROCEDURES**

 

 

 

(a)          The Chief Executive and Financial Officers concluded that the Registrant’s Disclosure Controls and Procedures are effective based on the evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.

 

 

 

(b)         There have been no changes in the registrant’s internal control over financial reporting that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal controls over financial reporting.

 

 

**ITEM 3.**

**EXHIBITS**

 

 

 

Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT.

 

 

**SIGNATURES**

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Registrant:

DWS GNMA Fund, a series of DWS Income Trust

 

 

By:

/s/Michael G. Clark

Michael G. Clark

President

 

 

Date:

August 17, 2009

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

Registrant:

DWS GNMA Fund, a series of DWS Income Trust

 

 

By:

/s/Michael G. Clark

Michael G. Clark

President

 

 

Date:

August 17, 2009

 

 

 

 

 

 

By:

/s/Paul Schubert

Paul Schubert

Chief Financial Officer and Treasurer

 

 

Date:

August 17, 2009

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