<PAGE>   1
                       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, 1998

                             Commission File Number
                                     0-18541

                       NATIONAL TAX CREDIT PARTNERS, L.P.

                        A CALIFORNIA LIMITED PARTNERSHIP

                  I.R.S. Employer Identification No. 95-4205231

       9090 WILSHIRE BOULEVARD, SUITE 201, BEVERLY HILLS, CALIFORNIA 90211

        Registrant's Telephone Number, Including Area Code (310) 278-2191

      Securities Registered Pursuant to Section 12(b) or 12(g) of the Act:

                                      NONE

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed with the Commission by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding twelve months (or 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
                                        -----   -----

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]


<PAGE>   2

PART I.

ITEM 1. BUSINESS:

National Tax Credit Partners, L.P. ("NTCP" or the "Partnership") is a limited
partnership formed under the laws of the State of California on March 7, 1989.
The Partnership was formed to acquire limited partnership interests in separate
local limited partnerships ("Local Partnerships"), which own multifamily
apartment complexes that are eligible for low-income housing federal income tax
credits ("Housing Tax Credits"). On June 6, 1989, the Partnership offered 14,000
units consisting of 28,000 limited partnership interests and warrants to
purchase 14,000 additional limited partnership interests (collectively "Limited
Partnership Interests") through a public offering managed by PaineWebber
Incorporated (the "Selling Agent").

The general partner of the Partnership is National Partnership Investments Corp.
("NAPICO"), a California corporation (the "General Partner"). The business of
the Partnership is conducted primarily by NAPICO.

Prior to December 30, 1998, NAPICO was a wholly owned subsidiary of Casden
Investment Corporation ("CIC"), which is wholly owned by Alan I. Casden. On
December 30, 1998, Casden Properties Operating Partnership, L.P. (the "Operating
Partnership"), a majority owned subsidiary of Casden Properties Inc., a real
estate investment trust organized by Alan I. Casden, purchased a 95.25% economic
interest in NAPICO. The current members of NAPICO's Board of Directors are
Charles H. Boxenbaum, Bruce E. Nelson, Alan I. Casden and Henry C. Casden.

In general, an owner of a low-income housing apartment complex ("Apartment
Complex") is entitled to receive Housing Tax Credits in each year of a ten-year
period (the "Credit Period"). The Apartment Complex is subject to a 15-year
compliance period (the "Compliance Period") to preserve the Housing Tax Credits.
In addition to the Housing Tax Credits, tax credits are available for certain
rehabilitation expenditures incurred in improving certified historic structures
("Historic Tax Credits," and together with Housing Tax Credits are referred to
as "Tax Credits"). Tax Credits are available to the Limited Partners to reduce
their federal income tax liability. The ability of a Limited Partner to utilize
Tax Credits or allocated losses may be restricted by the passive activity loss
limitation and the general business tax credit limitation rules. NTCP invests in
Local Partnerships that each own an Apartment Complex that is eligible for (i)
Housing Tax Credits or (ii) in certain cases, Historic Tax Credits and, in some
cases, both. Several of the Local Partnerships also benefit from government
programs promoting low or moderate income housing.

The Partnership's investments in Local Partnerships are subject to the risks
incident to the management and ownership of multifamily residential real estate.
Neither the Partnership's investments nor the Apartment Complexes owned by the
Local Partnerships will be readily marketable, and there can be no assurance
that the Partnership will be able to dispose of its Local Partnership Interests,
or that the Local Partnerships will be able to dispose of their Apartment
Complexes, at the end of the Compliance Period. The value of the Partnership's
investments will be subject to changes in national and local economic
conditions, including substantial unemployment, which could adversely impact
vacancy levels, rental payment defaults and operating expenses. This, in turn,
could substantially increase the risk of operating losses for the Apartment
Complexes and the Partnership. The Apartment Complexes will be subject to loss
through foreclosure. In addition, each Local Partnership is subject to risks
relating to environmental hazards which might be uninsurable. Because the
Partnership's ability to control its operations will depend on these and other
factors beyond the control of the General Partner and the local general
partners, there can be no assurance that the Partnership operations will be
profitable or that the anticipated Tax Credits will be available to Limited
Partners.

The Apartment Complexes owned by the Local Partnerships in which NTCP has
invested were developed by the Local Operating General Partners (the "Local
Operating General Partners") who acquired the sites and applied for applicable
mortgages and subsidies, if any. NTCP became the principal limited partner in
these Local Partnerships pursuant to arm's-length negotiations with the Local
Operating General Partners. As a limited partner, NTCP's liability for
obligations of the


<PAGE>   3


Local Partnership is generally limited to its investment. The Local Operating
General Partner of the Local Partnership retains responsibility for developing,
constructing, maintaining, operating and managing the Apartment Complex. Under
certain circumstances, an affiliate of NAPICO or NTCP may act as the Local
Operating General Partner. An affiliate, National Tax Credit Inc. ("NTC") or
another affiliate, is acting as a non-managing, administrative general partner
or special limited partner of each Local Partnership.




<PAGE>   4

During 1998, the Apartment Complexes in which NTCP had invested were
substantially rented.

The following is a schedule of the occupancy status as of December 31, 1998, of
the Apartment Complexes owned by Local Partnerships in which NTCP is a limited
partner.


                SCHEDULE OF PROJECTS OWNED BY LOCAL PARTNERSHIPS
                         IN WHICH NTCP HAS AN INVESTMENT
                                DECEMBER 31, 1998



<TABLE>
<CAPTION>
                                 No. of              Units         Percentage of
Name & Location                   Units            Occupied         Total Units
---------------                  ------            --------        --------------
<S>                             <C>               <C>             <C>
Apple Tree
Brigham City, UT                    24                 0                 0%

Blue Lake
Miami, FL                          106                84                79%

ComFed Qualified
Omaha, NE                          116               111                96%

Concept I & II
Cleveland, OH                       40                38                95%

Countryview/Columbus
Columbus, OH                       152               133                88%

Dickens
Chicago, IL                         34                34               100%

Dynes
Cleveland, OH                       42                41                98%

Genoa Plaza
Genoa City, WI                      48                46                96%

Glenark
Woonsocket, RI                      67                67               100%

Grand Meadows
Grand Blanc, MI                     64                62                97%

Grinnell Park
Grinnell, IA                        24                24               100%
</TABLE>





<PAGE>   5


                SCHEDULE OF PROJECTS OWNED BY LOCAL PARTNERSHIPS
                   IN WHICH NTCP HAS AN INVESTMENT (CONTINUED)
                                DECEMBER 31, 1998


<TABLE>
<CAPTION>
                                 No. of              Units         Percentage of
Name & Location                   Units            Occupied         Total Units
---------------                  ------            --------        --------------
<S>                             <C>               <C>             <C>

Hickory Green
Westland, MI                        59                58                98%

Holden Village
West Seattle, WA                    96                96               100%


Kimberly Court
Seward, AK                          24                 0                 0%

Meadows Apartments
Ypsilanti, MI                      114               112                98%

Mountain View - I
Sante Fe, NM                       120               107                89%

Mountain View - II
Sante Fe, NM                       159               143                90%

Newbury
Oak Creek, WI                      164               145                88%

North Liberty
North Liberty, IA                   24                24               100%

Paris Hotel
Denver, CO                          17                17               100%

Rolling Hills
Pottsgrove Township, PA            232               231                99%

Rose City
Portland, OR                       264               262                99%

Summit I - Wallace
Philadelphia, PA                    17                13                76%

Summit II - Bergdoll
Philadelphia, PA                     9                 9               100%

Summit III - Chandler
Philadelphia, PA                    25                24                96%
</TABLE>




<PAGE>   6

                SCHEDULE OF PROJECTS OWNED BY LOCAL PARTNERSHIPS
                   IN WHICH NTCP HAS AN INVESTMENT (CONTINUED)
                                DECEMBER 31, 1998



<TABLE>
<CAPTION>
                                 No. of              Units         Percentage of
Name & Location                   Units            Occupied         Total Units
---------------                  ------            --------        --------------
<S>                             <C>               <C>             <C>
Terrace Gardens
Lemon Grove, CA                    150               149                99%

Ticino
Seattle, WA                         45                40                89%

Torres de Plata I
Toa Alta, PR                        72                72               100%

Tyrone Elderly
Tyrone, PA                         100               100               100%

Victorian Park
Streamwood, IL                     336               316                94%

Vinton/Park School
Omaha, NE                           44                44               100%
                                 -----             -----  
TOTAL                            2,788             2,602                93%
                                 =====             =====  
</TABLE>





<PAGE>   7

ITEM 2. PROPERTIES:

Through its investments in Local Partnerships, NTCP holds interests in 31
Apartment Complexes. See Item 1 and Schedule for information pertaining to these
Apartment Complexes.

ITEM 3. LEGAL PROCEEDINGS:

As of December 31, 1998, NTCP's General Partner was a plaintiff or defendant in
several lawsuits. In addition, the Partnership is involved in the following
lawsuits arising from transactions in the ordinary course of business. In the
opinion of management and the General Partner, the claims will not result in any
material liability to the Partnership.

Victorian Park Associates, which owns a 336-unit Apartment Complex located in
Illinois, defaulted on its mortgage in July 1991 principally because the
unaffiliated Local Operating General Partners failed to pay $800,000 of real
estate taxes required under their guarantees. On March 25, 1992, the Partnership
commenced litigation [National Tax Credit Partners, L.P. v. Havlick, Owings,
United Development et al., Case No. 92C2074 in the United States District Court
for the Northern District of Illinois Eastern Division] against the Local
Operating General Partners to enforce its rights. On November 13, 1992 the
Partnership was advised that a Chapter 11 petition in bankruptcy was filed by
the local operating general partners on behalf of the Local Partnership [In re:
Victorian Park Associates, Debtor, Case No. 92-B-25140, Chapter 11] and that the
lender, Patrician Mortgage ("Patrician"), had accelerated its mortgage. On
January 7, 1993, the Partnership obtained an order compelling the Local
Operating General Partners to perform under their Guarantees, which order was
reversed by the U.S. Court of Appeals for the Seventh Circuit. The Local
Operating General Partners' Seventh Amended Plan of Reorganization (the "Plan")
is now pending approval. Pursuant to the Plan, Patrician is required to reissue
and/or reduce the principal on the first mortgage bonds and the Local Operating
General Partners are required to (i) pay $1,000,000 cash to implement the Plan
and (ii) pay an agreed upon monthly guarantee payment. No assurances can be
given that the Plan will be successfuly implemented. As of December 31, 1998 and
1997, the Partnership's carrying value of the investment in the Victorian Local
Partnership (which represents approximately 5.7% of the Partnership's total
equity initially invested in Local Partnerships) was zero.

In December 1992, Tara Construction, the general contractor for Art Museum
properties (Summit I, II and III), commenced an action in the Court of Common
Pleas, Montgomery County, Pennsylvania Tara Construction v. NTCP et al., (Case
No. 92-23505) against the three Summit Local Partnerships, the Partnership, NTC,
the General Partner, PaineWebber Incorporated, and a PaineWebber affiliate,
seeking damages of approximately $600,000 allegedly due the general contractor
for work done in connection with the completion of construction plus damages for
alleged misrepresentations and punitive damages. The Partnership believes that
the general contractor's claims are barred and/or subject to offset and it has
filed responsive pleadings. The Partnership has not accrued any liability in the
accompanying financial statements as of December 31, 1998 and 1997. Tara
Construction's lawsuit has been dormant for more than three years. Occupancy
levels at the three related Local Partnerships, Summit I, II, and III (Wallace,
Bergdoll, and Chandler School located in Philadelphia) were 76%, 100%, and 96%,
respectively, at December 31, 1998, and the properties have been operating at a
deficit. The local general partner is currently attempting to negotiate
discounted payments and/or payment plans for outstanding payables which, if
unsuccessful, could result in foreclosure proceedings on all three properties.
In 1996, the aggregate carrying value of the investments in Summit I, Summit II
and Summit III of approximately $2,290,000, was written off. Summit I, II and
III represent 3.2%, 1.4% and 4.6%, respectively, of NTCP's original portfolio
investment.



<PAGE>   8

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:

Not applicable.

PART II.

ITEM 5. MARKET FOR THE REGISTRANT'S PARTNERSHIP INTERESTS AND RELATED SECURITY
        HOLDER MATTERS:

The Limited Partnership Interests are not traded on a public exchange but were
sold through a public offering managed by PaineWebber Incorporated. It is not
anticipated that any active public market will develop for the purchase and sale
of any Limited Partnership Interest. Limited Partnership Interests may not be
transferred but can be assigned only if certain requirements in the Partnership
Agreement are satisfied. At December 31, 1998, there were 3,896 registered
holders of Limited Partnership Interests in NTCP. The Partnership was not
designed to provide cash distributions to Limited Partners in circumstances
other than refinancing or disposition of its investments in Local Partnerships
and then such distributions, if any, may be limited. Distributions have not been
made from the inception of the Partnership to December 31, 1998.


<PAGE>   9

ITEM 6. SELECTED FINANCIAL DATA:



<TABLE>
<CAPTION>
                                                            Year Ended December 31,
                                 ----------------------------------------------------------------------------
                                     1998           1997             1996            1995            1994
                                 ------------    ------------    ------------    ------------    ------------
<S>                              <C>             <C>             <C>             <C>             <C>         
Interest and other Income        $     14,100    $     51,975    $     99,016    $     75,125    $     54,226

Operating expenses                   (910,831)       (903,971)       (975,642)     (1,207,679)     (1,337,098)

Distributions from limited
   partnership recognized
   as income                          204,866          18,381          37,532              --              --

Equity in loss of limited
   partnerships and
   amortization of
   acquisition costs               (2,082,528)     (2,188,630)     (2,049,514)     (3,828,734)     (2,369,642)

Write-off of Local Partnership     (1,223,100)       (560,766)     (2,289,875)     (1,158,801)             --
                                 ------------    ------------    ------------    ------------    ------------

Net loss                         $ (3,997,493)   $ (3,583,011)   $ (5,178,483)   $ (6,120,089)   $ (3,652,514)
                                 ============    ============    ============    ============    ============

Net loss per limited
   partnership interest          $       (166)   $       (148)   $       (215)   $       (254)   $       (151)
                                 ============    ============    ============    ============    ============


Total assets                     $ 11,642,078    $ 14,985,893    $ 17,946,325    $ 22,499,105    $ 27,390,138
                                 ============    ============    ============    ============    ============

Investments in Local
   Partnerships                  $ 11,421,621    $ 14,370,207    $ 17,721,398    $ 21,923,823    $ 27,142,069
                                 ============    ============    ============    ============    ============

Capital contributions payable    $    266,841    $    329,030    $    392,300    $    441,300    $         --
                                 ============    ============    ============    ============    ============

Accrued fees and expenses
   due to partners               $  5,420,677    $  4,727,721    $  3,996,221    $  3,266,521    $  2,503,091
                                 ============    ============    ============    ============    ============
</TABLE>




<PAGE>   10

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS:

CAPITAL RESOURCES

The Partnership received proceeds totaling $59,749,000 from the sale of Limited
Partnership Interests, pursuant to a registration statement filed on Form S-11,
which sale commenced in June 1989 and terminated in June 1990. This amount
includes $18,907,500 from the sale of 7,563 Additional Limited Partnership
Interests. The proceeds have been used to invest in local limited partnerships
("Local Partnerships"), which own and operate multifamily housing complexes
("Apartment Complexes") that are eligible for low income housing tax credits or,
in certain cases, historic rehabilitation tax credits. As a limited partner of
the Local Partnerships, the Partnership does not have authority over day-to-day
management of the Local Partnerships or their Apartment Complexes. The general
partners responsible for management of the Local Partnerships (the "Local
Operating General Partners") are in most cases not affiliated with the General
Partner of the Partnership. See, however, the discussion below concerning the
replacement of the local operating general partners of certain Local
Partnerships and the assumption of those management responsibilities by National
Tax Credit, Inc. ("NTC"), or other affiliates of the General Partner. The
Partnership has made capital contributions to 32 Local Partnerships (one of
which was foreclosed upon by the lender in 1995) representing a total investment
of approximately $44,811,000.

It is not expected that any of the Local Partnerships in which the Partnership
invested will generate cash from operations sufficient to provide distributions
to the Limited Partners. Such cash from operations, if any, would first be used
to meet operating expenses of the Partnership. The Partnership's investments are
not readily marketable and may be affected by adverse general economic
conditions which, in turn, could substantially increase the risk of operating
losses for the Apartment Complexes, the Local Partnerships and the Partnership.
These problems may result from a number of factors, many of which cannot be
controlled by the General Partner.

The General Partner has the right to cause distributions received by the
Partnership from the Local Partnerships (that would otherwise be available for
distributions as cash flow) to be dedicated to the increase or replenishment of
reserves at the Partnership level. The reserves are available to satisfy working
capital or operating expense needs of the Partnership (including payment of
partnership management fees) and will also be available to pay any excess
third-party costs or expenses incurred by the Partnership in connection with the
administration of the Partnership, the preparation of reports to the Limited
Partners and other investor servicing obligations of the Partnership. At the
discretion of the General Partner, reserves may be available for contributions
to the Local Partnerships.

The Partnership's unrestricted cash reserves as of December 31, 1998 were
approximately $220,457. In order to replenish NTCP's reserves, NTCP sold to the
local general partner an additional portion and further diluted its limited
partner interest in the Rose City local partnership during 1997. The local
general partner will, accordingly, be entitled to an increased allocation of
cash flow and proceeds from the sale or refinancing of the property. NTCP will
continue to receive its allocable portion of housing tax credits, subject to the
allocation made to the additional limited partner identified in a prior report,
through the ten year credit period. As a result of this transaction, NTCP
received $260,000 during 1997. In addition, NTCP sold to an unrelated party a
portion of its limited partner interest in the Countryview local partnership and
received $625,582 during 1997. The amounts received from these sales are traded
as reductions to the Partnership's investment balance in the local partnerships.

The Partnership does not have the ability to assess Limited Partners for
additional capital contributions to provide capital if needed by the Partnership
or Local Partnerships. Accordingly, if circumstances arise that cause the Local
Partnerships to require capital in addition to that contributed by the
Partnership and any equity of the local general partners, the only sources from
which such capital needs will be able to be satisfied (other than the limited
reserves available at the Partnership level) will be (i) third-party debt
financing (which may not be available if, as expected, the Apartment Complexes
owned by the Local Partnerships are already substantially leveraged), (ii) other
equity sources (which could reduce the amount of Tax Credits being allocated to
the Partnership, adversely affect the Partnership's interest in operating cash
flow and/or proceeds of sale or refinancing of the Apartment Complexes and
possibly even result in adverse tax consequences to the


<PAGE>   11


Limited Partners), or (iii) the sale or disposition of Apartment Complexes.
There can be no assurance that any of such sources would be readily available in
sufficient proportions to fund the capital requirements of the Local
Partnerships. If such sources are not available, the Local Partnerships would
risk foreclosure on their Apartment Complexes if they were unable to renegotiate
the terms of their first mortgages and any other debt secured by the Apartment
Complexes, which would have significant adverse tax consequences to the Limited
Partners.

LIQUIDITY

Each Local Partnership investment has been analyzed by the General Partner with
respect to its probable impact upon the Partnership's liquidity position. In
this regard, the General Partner took into account projected cash flow generated
from each Apartment Complex, the anticipated debt service requirements of the
existing financing and any restructuring or refinancing of such Apartment
Complex, and the division of cash flow in excess of debt service between the
Partnership and the local operating general partner.

Following an acquisition, adverse business or financial developments could
negatively impact cash flow and the Partnership's liquidity position. The
General Partner has attempted to obtain operating deficit guarantees from
certain local general partners to fund operating deficits for limited periods of
time. In addition, as discussed above the Partnership maintains reserves and the
Local Partnerships are expected to maintain working capital reserves independent
of those maintained by the Partnership to the extent that (i) the terms of
mortgage debt encumbering the Apartment Complexes or the terms of any government
assistance program so require, or (ii) the local general partner determines that
such reserves are necessary or advisable. Although reserves are to be maintained
at both the Partnership and Local Partnership levels, if such reserves and other
available income, if any, are insufficient to cover the Partnership's or any
Local Partnership's operating expenses and liabilities, it may be necessary to
accumulate additional funds from distributions received from Local Partnerships
which would otherwise be available for distribution to the Limited Partners, or
to liquidate the Partnership's investment in one or more Local Partnerships.

Reserves of the Partnership and reserves of the Local Partnerships may be
increased or decreased from time to time by the General Partner or the local
general partner, as the case may be, in order to meet anticipated costs and
expenses. The amount of cash flow available for distributions and/or sale as
refinancing proceeds, if any, which is available for distribution to the Limited
Partners may be affected accordingly.

RESULTS OF OPERATIONS

The Partnership was formed to provide various benefits to its Limited Partners
as discussed in Item 1. It is not expected that any of the Local Partnerships in
which the Partnership has invested will generate cash flow sufficient to provide
for distributions to Limited Partners. The Partnership accounts for its
investments in the Local Partnerships on the equity method, thereby adjusting
its investment balance by its proportionate share of the income or loss of the
Local Partnerships.

In general, in order to avoid recapture of Tax Credits, the Partnership does not
expect that it will voluntarily dispose of its Local Partnership Interests or
approve the sale by a Local Partnership of any Apartment Complex prior to the
end of the applicable 15-year Compliance Period (although earlier dispositions
of Historic Complexes may occur). Because of (i) the nature of the Apartment
Complexes, (ii) the difficulty of predicting the resale market for low-income
housing 15 or more years in the future, and (iii) the inability of the
Partnership to directly cause the sale of Apartment Complexes by local general
partners, but generally only to require such local general partners to use their
respective best efforts to find a purchaser for the Apartment Complexes, it is
not possible at this time to predict whether the liquidation of substantially
all of the Partnership's assets and the disposition of the proceeds, if any, in
accordance with the Partnership Agreement will be able to be accomplished
promptly at the end of the 15-year Compliance Period. If a Local Partnership is
unable to sell an Apartment Complex, it is anticipated that the local general
partner will either continue to operate such Apartment Complex or take such
other actions as the local general partner believes to be in the best interest
of the Local Partnership. In addition, circumstances beyond the control of the
General Partner may occur during the Compliance Period which would require the
Partnership to approve the disposition of an Apartment Complex prior to the end
of the Compliance Period.



<PAGE>   12



Except for interim investments in highly liquid debt investments, the
Partnership's investments consist entirely of interests in other Local
Partnerships owning Apartment Complexes. Funds temporarily not required for such
investments in projects are invested in these highly liquid debt investments
earning interest income as reflected in the statement of operations. These
interim investments can be easily converted to cash to meet obligations as they
arise.

The Partnership, as a limited partner in the Local Partnerships in which it has
invested, is subject to the risks incident to the construction, management, and
ownership of improved real estate. The Partnership investments are also subject
to adverse general economic conditions, and accordingly, the status of the
national economy, including substantial unemployment and concurrent inflation,
could increase vacancy levels, rental payment defaults, and operating expenses,
which in turn, could substantially increase the risk of operating losses for the
Apartment Complexes. Certain of the Local Partnerships and their respective
Apartment Complexes are subject to litigation and operating problems. See Item 3
"Legal Proceedings" above and the information which follows.

The Meadows Apartments (the "Local Partnership") is a 114-unit building located
in Ypsilanti, Michigan. The first mortgage loan matured on May 15, 1996. After
the lender refused to negotiate an extension of the loan, the Local Partnership
filed Chapter 11 bankruptcy proceedings to avert foreclosure. A plan of
reorganization for the Local Partnership (the "Plan") was approved by the
bankruptcy court on December 16, 1996. Under the Plan, the existing loan in the
principal amount of $2,890,000, at an interest rate of 10%, was reduced to
$2,100,000 with an interest rate of 9%. In exchange, the lender received
one-third of NTCP's local partnership interest, including anticipated
allocations of housing tax credits in the amount of approximately $488,500. The
property operated at an occupancy level of 96% as of December 1998 and attained
break-even levels of operations during 1998 and 1997. The Partnership's
investment in Meadows Apartments was zero at December 31, 1998 and 1997, as the
investment was written off in 1995.

Holden Village and Ticino Apartments, located in Seattle, Washington, maintained
average occupancy levels of 97% and 91%, respectively, and have been
experiencing operating deficits. The high cost of servicing the debt is the
largest contributing factor associated with the deficit operations. In January
1998, NTCP was successful in negotiating an interest rate reduction with the
lender for each of the properties. Based on the loan modifications, the
operating performance of each property is expected to improve. The Partnership's
total investment in Holden Village and Ticino Apartments of approximately
$1,223,100 was written off in 1998.

The Dynes Village Apartments complex is operating at a deficit and the first
mortgage loan encumbering the property was delinquent until it was brought
current by NTCP in November 1997. In addition, the property has been audited by
the IRS with respect to tenant qualifications performed by the prior local
operating general partner. The IRS has disqualified all future housing tax
credits based on what they consider non-compliance by the prior local operating
general partner. As a result, the Partnership's investment in Dynes Village of
$560,766 was written off during 1997.

Pursuant to the terms of a workout, dated January 11, 1995 (the "Workout")
agreed upon between the parties relating to the resolution of an existing
default under the first mortgage loan encumbering Glenark Landing, annual
payments of $42,800 for a five year term, totaling $214,000, are due to the
Rhode Island Housing and Mortgage Finance Corporation (the "Lender"). The
Partnership's investment in Glenark Landing was zero at December 31, 1998 and
1997. A dispute has arisen as to whether the local partnership is in default 
under the Workout. The parties are currently engaged in settlement discussions 
regarding this dispute.

Pursuant to the terms of a loan workout relating to the Blue Lake Local
Partnership, dated March 25, 1995 (the "Workout"), NTCP is required to
contribute an additional $541,300 to the local partnership over a ten year
period. In exchange, the debt service on the property is payable out of net cash
flow. During 1998 and 1997, approximately $62,000 and $63,000, respectively, was
paid by NTCP to the local partnership under the Workout. The Partnership's
investment in Blue Lake was zero at December 31, 1998 and 1997.

During 1997, the Oregon Housing and Community Services Department ("Department")
inspected Rose City Village Limited Partnership's compliance with the low-income
housing credit provisions of the Internal Revenue Code, and determined that the
Partnership was not in compliance. The Department filed Form 8823, Low-Income
Housing Credit Agencies Report of Noncompliance, with the Internal Revenue
Service. NTCP Management believes the instances of




<PAGE>   13

noncompliance are now corrected; however, as of the date of this report,
resolution of this matter by the Department and the Internal Revenue Service is
still outstanding. The effect, if any, of the noncompliance on the financial
statements of the Partnership cannot be determined at this date. The
Partnership's investment in Rose City at December 31, 1998 was $532,337.

The Partnership accounts for its investments in the Local Partnerships on the
equity method, thereby adjusting its investment balance by its proportionate
share of the income or loss of the Local Partnerships. Equity in losses of Local
Partnerships is recognized in the financial statements until the limited
partnership investment account is reduced to a zero balance. Losses incurred
after the limited partnership investment account is reduced to zero are not
recognized. Limited partners are not liable for losses beyond their contributed
capital. Equity in losses of Local Partnerships decreased in 1998 because Dynes
Village and the Summits were written off in 1997 and 1996, respectively, as
discussed above.

Distributions received from Local Partnerships are recognized as return of
capital until the investment balance has been reduced to zero or to a negative
amount equal to future capital contributions required. Subsequent distributions
received are recognized as income.

Operating expenses consist primarily of recurring general and administrative
expenses and professional fees for services rendered to the Partnership. In
addition, an annual partnership management fee in an amount equal to 0.5% of
invested assets is payable to the General Partner and Special Limited Partner.
The management fee represents the annual recurring fee which will be paid to the
General Partner for its continuing management of Partnership affairs. The
decrease in legal fees for the year ended December 31, 1998 and 1997, as
compared to 1996, is due to higher legal fees in 1996 associated with the final
settlement of litigation involving the Blue Lake, Dynes and Glenark Local
Partnerships as well as legal fees being paid in connection with the Victorian
Park bankruptcy, and legal fees incurred in connection with various securities
matters.

The Partnership has assessed the potential impact of the Year 2000 computer
systems issue on its operations. The Partnership believes that no significant
actions are required to be taken by the Partnership to address the issue and
that the impact of the Year 2000 computer systems issue will not materially
affect the Partnership's future operating results or financial condition.


ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA:

The Financial Statements and Supplementary Data are listed under Item 14.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE:

Not applicable.



<PAGE>   14

                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                              FINANCIAL STATEMENTS,
                          FINANCIAL STATEMENT SCHEDULES
                  AND REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
                                DECEMBER 31, 1998




<PAGE>   15

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



To the Partners of
National Tax Credit Partners, L.P.
(A California limited partnership)

We have audited the accompanying balance sheets of National Tax Credit Partners,
L.P. (a California limited partnership) as of December 31, 1998 and 1997, and
the related statements of operations, partners' equity (deficiency) and cash
flows for each of the three years in the period ended December 31, 1998. Our
audits also included the financial statement schedules listed in the index in
item 14. These financial statements and financial statement schedules are the
responsibility of the management of the Partnership. Our responsibility is to
express an opinion on these financial statements and financial statement
schedules based on our audits. We did not audit the financial statements of
certain investee limited partnerships, the investments in which are reflected in
the accompanying financial statements using the equity method of accounting. The
investments in these investee limited partnerships represent 98 percent and 40
percent of total assets as of December 31, 1998 and 1997, respectively, and the
equity in the net loss of these partnerships represents 70 percent, 44 percent
and 55 percent of the total net loss of the Partnership for the years ended
December 31, 1998, 1997 and 1996, respectively, and represent a substantial
portion of the investee information in Note 2 and the financial statement
schedules. The financial statements of these investee limited partnerships were
audited by other auditors. Their reports have been furnished to us and our
opinion, insofar as it relates to the amounts included for those limited
partnerships, is based solely on the reports of the other auditors.

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 and the reports of the other auditors provide a
reasonable basis for our opinion.

In our opinion, based on our audits and the reports of other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of National Tax Credit Partners, L.P. as of December 31,
1998 and 1997, and the results of its operations and its cash flows for each of
the three years in the period ended December 31, 1998 in conformity with
generally accepted accounting principles. Also, in our opinion, based on our
audits and the reports of other auditors, such financial statement schedules,
when considered in relation to the basic financial statements taken as a whole,
present fairly in all material respects the information set forth therein.


DELOITTE & TOUCHE LLP

Los Angeles, California
April 8, 1999


<PAGE>   16

                       [DELOITTE & TOUCHE LLP LETTERHEAD]



                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Partners of
National Tax Credit Partners, L.P.
(A California limited partnership)

We have audited the accompanying balance sheets of National Tax Credit Partners,
L.P. (a California limited partnership) as of December 31, 1997 and 1996, and
the related statements of operations, partners' equity (deficiency) and cash
flows for each of the three years in the period ended December 31, 1997. Our
audits also included the financial statement schedules listed in the index on
item 14. These financial statements and financial statement schedules are the
responsibility of the management of the Partnership. Our responsibility is to
express an opinion on these financial statements and financial statement
schedules based on our audits. We did not audit the financial statements of
certain investee limited partnerships, the investments in which are reflected in
the accompanying financial statements using the equity method of accounting. The
investments in these investee limited partnerships represent 40 percent and 35
percent of total assets as of December 31, 1997 and 1996, respectively, and the
equity in the net loss of these partnerships represents 44 percent, 55 percent
and 37 percent of the total net loss of the Partnership for the years ended
December 31, 1997, 1996 and 1995, respectively, and represent a substantial
portion of the investee information in Note 2 and the financial statement
schedules. The financial statements of these investee limited partnerships were
audited by other auditors. Their reports have been furnished to us and our
opinion, insofar as it relates to the amounts included for those limited
partnerships, is based solely on the reports of the other auditors.

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 and the reports of the other auditors provide a
reasonable basis for our opinion.

In our opinion, based on our audits and the reports of other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of National Tax Credit Partners, L.P. as of December 31,
1997 and 1996, and the results of its operations and its cash flows for each of
the three years in the period ended December 31, 1997 in conformity with
generally accepted accounting principles. Also, in our opinion, based on our
audits and the reports of other auditors, such financial statement schedules,
when considered in relation to the basic financial statements taken as a whole,
present fairly in all material respects the information set forth therein.


DELOITTE & TOUCHE LLP

Los Angeles, California
April 8, 1998

<PAGE>   17

[ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT


To the Partners
Countryview Columbus, Ltd.


We have audited the balance sheets of COUNTRYVIEW COLUMBUS, LTD. as of December
31, 1997 and 1996 and the related statements of operations, changes in
partners' equity and cash flows for each of the three years in the period
ended December 31, 1997. These financial statements are the responsibility of
the Partnership's management. Our responsibility is to express an opinion on
these financial statements 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 Countryview Columbus, Ltd. as
of December 31, 1997 and 1996 and the results of its operations, changes in
partners' equity and cash flows for each of the three years in the period ended
December 31, 1997 in conformity with generally accepted accounting principles.

Our audits were conducted for the purpose of forming an opinion on the
financial statements taken as a whole. The additional financial data are
presented for the purpose of additional analysis and are not a required part of
the financial statements. Such information has been subjected to the auditing
procedures applied in the audits of the financial statements and, in our
opinion, is fairly stated in all material respects in relation to the financial
statements taken as a whole.

/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
---------------------------------------

Chicago, Illinois
March 11, 1998

     
<PAGE>   18
                               [HSW&E LETTERHEAD]


                          INDEPENDENT AUDITORS' REPORT


To the Partners
Genoa Plaza, Limited Partnership
West Des Moines, Iowa


      We have audited the accompanying balance sheets of GENOA PLAZA, LIMITED
PARTNERSHIP as of December 31, 1997 and 1996, and the related statements of
operations, partners' equity (deficit) and cash flows for the years then ended.
These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

      We conducted our audits in accordance with generally accepted auditing
standards and Governmental Auditing Standards, issued by the Comptroller General
of the United States and U.S. Department of Agriculture Farmers Home
Administration, Audit Program. 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 Genoa Plaza, Limited
Partnership as of December 31, 1997 and 1996 and the results of its operations
and its cash flows for the years then ended, in conformity with generally
accepted accounting principles.

      In accordance with Government Auditing Standards, we have also issued our
reports dated January 13, 1998 on our consideration of Genoa Plaza, Limited
Partnership' internal control and on its compliance with laws and regulations.


                               /s/ HUMISTON, SKOKAN, WARREN & EICHENBERGER, P.C.
                               -------------------------------------------------

January 13, 1998

West Des Moines, Iowa



                                       1

<PAGE>   19
              [HUMISTON, SKOKAN, WARREN & EICHENGERGER LETTERHEAD]


                          INDEPENDENT AUDITORS' REPORT


To the Partners
Genoa Plaza, Limited Partnership
West Des Moines, Iowa

     We have audited the accompanying balance sheets of GENOA PLAZA, LIMITED 
PARTNERSHIP as of December 31, 1996 and 1995, and the related statements of
operations, partners' equity (deficit) and cash flows for the years then ended.
These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion of these financial
statements based on our audits.

     We conducted our audits in accordance with generally accepted auditing
standards and Governmental Auditing Standards, issued by the Comptroller
General of the United States and U.S. Department of Agriculture Farmers Home
Administration, Audit Program. 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 Genoa Plaza, Limited
Partnership as of December 31, 1996 and 1995 and the results of its operations
and its cash flows for the years then ended, in conformity with generally
accepted accounting principles.



/s/ HUMISTON, SKOKAN, WARREN & EICHENGERGER, P.C.
-------------------------------------------------

January 10, 1997
West Des Moines, Iowa


                                       1


<PAGE>   20

                        [PLANTE & MORAN, LLP LETTERHEAD]



                          Independent Auditor's Report



To the Partners
Grand Meadows II Limited Dividend
Housing Association Limited Partnership

We have audited the accompanying balance sheet of Grand Meadows II Limited
Dividend Housing Association Limited Partnership (a Michigan limited
partnership) MSHDA Development No. 827, as of December 31, 1997, 1996, and 1995,
and the related statements of profit and loss, partners' equity, and cash flows
for the years then ended. These financial statements are the responsibility of
the Partnership's management. Our responsibility is to express an opinion on
these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing standards
and Government Auditing Standards, issued by the Comptroller General of the
United States. Those standards require that we plan and perform the audits 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 Grand Meadows II Limited
Dividend Housing Association Limited Partnership as of December 31, 1997, 1996,
and 1995, and its profit and loss, partners' equity, and its cash flows for the
years then ended, in conformity with generally accepted accounting principles.

In accordance with Government Auditing Standards, we have also issued a report
dated January 9, 1998, on our consideration of the Partnership's internal
controls and a report dated January 9, 1998, on its compliance with laws and
regulations.


                                                         /s/ PLANTE & MORAN, LLP
                                                         -----------------------

January 9, 1998

East Lansing, Michigan 48826-2500


<PAGE>   21

                               [HSW&E LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT

To the Partners
Grinnell Park Apartments, Limited Partnership
West Des Moines, Iowa


      We have audited the accompanying balance sheets of GRINNELL PARK
APARTMENTS, LIMITED PARTNERSHIP as of December 31, 1997 and 1996, and the
related statements of operations, partners' equity (deficit) and cash flows for
the years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements 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 Grinnell Park Apartments,
Limited Partnership as of December 31, 1997 and 1996 and the results of its
operations and its cash flows for the years then ended, in conformity with
generally accepted accounting principles.


                               /s/ HUMISTON, SKOKAN, WARREN & EICHENBERGER, P.C.
                               -------------------------------------------------

January 14, 1998

West Des Moines, Iowa

<PAGE>   22

              [HUMISTON, SKOKAN, WARREN & EICHENBERGER, LETTERHEAD]


                          INDEPENDENT AUDITORS' REPORT

To the Partners
Grinnell Park Apartments, Limited Partnership
West Des Moines, Iowa


      We have audited the accompanying balance sheets of GRINNELL PARK
APARTMENTS, LIMITED PARTNERSHIP as of December 31, 1996 and 1995, and the
related statements of operations, partners' equity (deficit) and cash flows for
the years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements 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 Grinnell Park Apartments,
Limited Partnership as of December 31, 1996 and 1995 and the results of its
operations and its cash flows for the years then ended, in conformity with
generally accepted accounting principles.


                               /s/ HUMISTON, SKOKAN, WARREN & EICHENBERGER, P.C.
                               -------------------------------------------------

January 10, 1997


West Des Moines, Iowa



<PAGE>   23
[LOGO]

ALTSCHULER, MELVOIN AND GLASSER LLP                            Chicago
Certified Public Accountants and Consultants                   Los Angeles
                                                               New York 
                                                               Tampa
                                                               Washington, D.C.
                          INDEPENDENT AUDITORS' REPORT

To the Partners
Hickory Green Limited Partnership

We have audited the balance sheets of HICKORY GREEN LIMITED PARTNERSHIP as of
December 31, 1997 and 1996 and the related statements of operations, changes in
partners' equity and cash flows for each of the three years in the period ended
December 31, 1997. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements 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 Hickory Green Limited
Partnership as of December 31, 1997 and 1996 and the results of its operations,
changes in partners' equity and cash flows for each of the three years in the
period ended December 31, 1997 in conformity with generally accepted accounting
principles.

Our audits were conducted for the purpose of forming an opinion on the
financial statements taken as a whole. The additional financial data are
presented for the purpose of additional analysis and are not a required part of
the financial statements. Such information has been subjected to the auditing
procedures applied in the audits of the financial statements and, in our
opinion, is fairly stated in all material respects in relation to the financial
statements taken as a whole.

Altschuler, Melvoin and Glasser LLP
Chicago, Illinois
February 21, 1998

35 South Wacker Drive, Suite 2600, Chicago, Illinois 60606-7494
312-207-2809 Fax 312-207-2954 http://www.amgnet.com

Associated Worldwide With Summit International Associates, Inc.
 
<PAGE>   24


                [ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]


                          INDEPENDENT AUDITORS' REPORT

To the Partners
Holden Village Associates

We have audited the balance sheets of HOLDEN VILLAGE ASSOCIATES as of December
31, 1997 and 1996 and the related statements of operations, changes in partners'
equity and cash flows for each of the three years in the period ended December
31, 1997. These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements 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 Holden Village Associates as of
December 31, 1997 and 1996 and the results of its operations, changes in
partners' equity and cash flows for each of the three years in the period ended
December 31, 1997 in conformity with generally accepted accounting principles.

The financial statements have been prepared assuming the Partnership will
continue as a going concern. As described in Note 6, insufficient cash flows and
recurring losses from operations raise substantial doubt about the Project's
ability to continue as a going concern. Management's plans regarding these
matters are described in Note 6. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

Our audits were conducted for the purpose of forming an opinion on the financial
statements taken as a whole. The additional financial data are presented for the
purpose of additional analysis and are not a required part of the financial
statements. Such information has been subjected to the auditing procedures
applied in the audits of the financial statements and, in our opinion, is fairly
stated in all material respects in relation to the financial statements taken as
a whole.

                                         /s/ ALTSCHULER, MELVOIN AND GLASSER LLP
                                         ---------------------------------------


Los Angeles, California
March 5, 1998



<PAGE>   25

                [ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]


                          INDEPENDENT AUDITORS' REPORT


To the Partners of
Holden Village Associates


We have audited the accompanying balance sheets of HOLDEN VILLAGE ASSOCIATES (a
limited partnership) as of December 31, 1996 and 1995, and the related
statements of operations, changes in partners, equity and cash flows for the
years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements 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 Holden village Associates as of
December 31, 1996 and 1995, and the results of its operations, changes in its
partners' equity, and its cash flows for the years then ended in conformity with
generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that the
Partnership will continue as a going concern. Insufficient cash flows and
recurring losses from operations raise substantial doubt about the Partnership's
ability to continue as a going concern. Management's plans in regard to these
matters are described in Note 6. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.




                                       2.
<PAGE>   26



Our audits were made for the purpose of forming an opinion on the financial
statements taken as a whole. The additional 1996 financial data, listed in the
Table of Contents, are presented for the purpose of additional analysis and are
not a required part of the financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the 1996 financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the financial statements taken as a whole.


                                         /s/ ALTSCHULER, MELVOIN AND GLASSER LLP
                                         ---------------------------------------

Los Angeles, California

March 7, 1997





                                       3.
<PAGE>   27

                [ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT



To the Partners
Mountain View Limited Partnership

We have audited the balance sheets of MOUNTAIN VIEW LIMITED PARTNERSHIP as of
December 3 1, 1997 and 1996 and the related statements of operations, changes in
partners' equity and cash flows for each of the three years in the period ended
December 31, 1997. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements 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 Mountain View Limited
Partnership as of December 31, 1997 and 1996 and the results of its operations,
changes in partners' equity and cash flows for each of the three years in the
period ended December 31, 1997 in conformity with generally accepted accounting
principles.

Our audits were conducted for the purpose of forming an opinion on the financial
statements taken as a whole. The additional financial data are presented for the
purpose of additional analysis and are not a required part of the financial
statements. Such information has been subjected to the auditing procedures
applied in the audits of the financial statements arid, in our opinion, is
fairly stated in all material respects in relation to the financial statements
taken as a whole.


/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
---------------------------------------

Los Angeles, California

March 5, 1998



<PAGE>   28

                [ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT



To the Partners of
Mountain View Limited Partnership


We have audited the accompanying balance sheets of MOUNTAIN VIEW LIMITED
PARTNERSHIP as of December 31, 1996 and 1995, and the related statements of
operations, changes in partners' equity and cash flows for the years then ended.
These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements 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 mountain View Limited
Partnership as of December 31, 1996 and 1995, and its results of operations,
changes in partners' equity, and cash flows for the years then ended in
conformity with generally accepted accounting principles.

Our audits were made for the purpose of forming an opinion on the financial
statements, taken as a whole. The additional 1996 financial data, listed in the
Table of Contents, are presented for the purpose of additional analysis and are
not a required part of the financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the 1996 financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the financial statements taken as a whole.


/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
---------------------------------------


Los Angeles, California
February 17, 1997



<PAGE>   29

                [ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT



To the Partners
Mountain View Limited Partnership II

We have audited the balance sheets of MOUNTAIN VIEW LIMITED PARTNERSHIP II as of
December 31, 1997 and 1996 and the related statements of operations, changes in
partners' equity and cash flows for each of the three years in the period ended
December 31, 1997. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements 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 Mountain View Limited
Partnership II as of December 31, 1997 and 1996 and the results of its
operations, changes in partners' equity and cash flows for each of the three
years in the period ended December 31, 1997 in conformity with generally
accepted accounting principles.

Our audits were conducted for the purpose of forming an opinion on the financial
statements taken as a whole. The additional financial data are presented for the
purpose of additional analysis and are not a required part of the financial
statements. Such information has been subjected to the auditing procedures
applied in the audits of the financial statements and, in our opinion, is fairly
stated in all material respects in relation to the financial statements taken as
a whole.


/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
---------------------------------------


Los Angeles, California
February 10, 1998


<PAGE>   30

                [ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]


                          INDEPENDENT AUDITORS' REPORT



To the Partners of
Mountain View Limited Partnership II


We have audited the accompanying balance sheets of MOUNTAIN VIEW LIMITED
PARTNERSHIP II as of December 31, 1996 and 1995, and the related statements of
operations, changes in partners' equity and cash flows for the years then ended.
These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements 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 Mountain View Limited
Partnership II as of December 31, 1996 and 1995, and its results of operations,
changes in partners, equity and cash flows for the years then ended in
conformity with generally accepted accounting principles.

Our audits were made for the purpose of forming an opinion on the financial
statements, taken as a whole. The additional 1996 financial data, listed in the
Table of Contents, are presented for the purpose of additional analysis and are
not a required part of the financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the 1996 financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the financial statements taken as a whole.


/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
---------------------------------------


Los Angeles, California
February 17, 1997



<PAGE>   31

                               [HSW&E LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT

To the Partners
North Liberty Park, Limited Partnership
Nest Des Moines, Iowa


      We have audited the accompanying balance sheets of NORTH LIBERTY PARK,
LIMITED PARTNERSHIP as of December 31, 1997 and 1996, and the related statements
of operations, partners' equity (deficit) and cash flows for the years then
ended. These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements 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 North Liberty Park, Limited
Partnership as of December 31, 1997 and 1996 and the results of its operations
and its cash flows for the years then ended, in conformity with generally
accepted accounting principles.


/s/ HUMISTON, SKOKAN, WARREN & EICHENBERGER P.C.
------------------------------------------------


January 9, 1998
West Des Moines, Iowa



                                       1

<PAGE>   32

              [HUMISTON, SKOKAN, WARREN & EICHENBERGER LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT


To the Partners
North Liberty Park, Limited Partnership
West Des Moines, Iowa


      We have audited the accompanying balance sheets of NORTH LIBERTY PARK,
LIMITED PARTNERSHIP as of December 31, 1996 and 1995, and the related statements
of operations, partners' equity (deficit) and cash flows for the years then
ended. These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements 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 North Liberty Park, Limited
Partnership as of December 31, 1996 and 1995 and the results of its operations
and its cash flows for the years then ended, in conformity with generally
accepted accounting principles.



/s/ HUMISTON, SKOKAN, WARREN & EICHENBERGER P.C.
------------------------------------------------


January 9, 1997
West Des Moines, Iowa



                                       1

<PAGE>   33

              [BERNSTEIN SIMPSON GILBERT & MOROWITZ LLC LETTERHEAD]


                          Independent Auditor's Report


To the Partners
Rolling Hills Apts. Ltd.
Pottsgrove Township, Pa.

We have audited the accompanying balance sheets of Rolling Hills Apts. Ltd. (a
limited partnership), Pa. Project No. PHFA No. 61 as of December 31, 1997 and
1996, and the related statements of income, changes in partners' equity and cash
flows for the years then ended. These financial statements are the
responsibility of the Rolling Hills Apts. Ltd.'s management. Our responsibility
is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards
and Government Auditing Standards, issued by the Comptroller General of the
United States. 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 the significant
estimates made by management, as well as evaluating the overall financial
statement presentation. we believe that our audit provides a reasonable basis
for our opinion.



<PAGE>   34



In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Rolling Hills Apts. Ltd. Pa.
Project No. PHFA No. 61 as of December 31, 1997 and 1996, and the results of its
operations, changes in partners, deficit and cash flows for the years then ended
in conformity with generally accepted accounting principles.

Our audit was conducted for the purpose of forming an opinion on the financial
statements taken as a whole. The supporting data included in the report (shown
on pages 15 to 31) are presented for the purposes of additional analysis and are
not a required part of the financial statements of Rolling Hills Apts. Ltd. Pa.
Project No. PHFA No. 61. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the financial
statements taken as a whole.


Respectfully submitted,


/s/ BERNSTEIN SIMPSON GILBERT & MOROWITZ LLC
--------------------------------------------
BERNSTEIN, SIMPSON, GILBERT AND MOROWITZ, LLC



Atlantic City, N.J.
February 9, 1998



<PAGE>   35

              [BERNSTEIN SIMPSON GILBERT & MOROWITZ LLC LETTERHEAD]



                          Independent Auditor's Report


To the Partners
Rolling Hills Apts. Ltd.
Pottsgrove Township, Pa.


We have audited the accompanying balance sheets of Rolling Hills Apts. Ltd. (a
limited partnership), HUD Project No. PHFA No. 61 as of December 31, 1996 and
1995, and the related statements of income, changes in partners' deficit and
cash flows for the years then ended. These financial statements are the
responsibility of the Rolling Hills Apts. Ltd.'s management. Our responsibility
is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards
and Government Auditing Standards, issued by the Comptroller General of the
United States. 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 the significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.



<PAGE>   36


In our opinion, the statements referred to above present fairly, in all material
respects, the financial position of Rolling Hills Apts. Ltd. HUD Project No.
PHFA No. 61 as of December 31, 1996 and 1995, and the results of its operations,
changes in partners' deficit and Cash f1ows for the years then ended in
conformity with generally accepted accounting principles.

Our audit was conducted for the purpose of forming an opinion on the financial
statements taken as a whole. The supporting data included in the report (shown
on pages 15 to 31) are presented for the purposes of additional analysis and are
not a required part of the financial statements of Rolling Hills Apts. Ltd.
Project No. PHFA No. 61. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the financial
statements taken as a whole.


Respectfully submitted,


/s/ BERNSTEIN SIMPSON GILBERT & MOROWITZ LLC
--------------------------------------------
BERNSTEIN, SIMPSON, GILBERT AND MOROWITZ, LLC


Atlantic City, N.J.
February 8, 1997



<PAGE>   37

                [TORRES LLOMPART, SANCHEZ RUIZ & CO LETTERHEAD]



              INDEPENDENT AUDITORS' REPORT ON FINANCIAL STATEMENTS


PARTNERS
TORRES DEL PLATA I LIMITED PARTNERSHIP
SAN JUAN, PUERTO RICO

We have audited the accompanying balance sheets of Torres del Plata I Limited
Partnership as of December 31, 1997 and 1996, and the related statements of
operations, partners' equity, and cash flows for the years then ended. These
financial statements are the responsibility of the Partnership's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing standards
and Government Auditing Standards, issued by the Comptroller General of the
United States and the US Department of Agriculture, Farmers Home Administration
Audit Program Handbook, issued in December 1989. Those standards require that we
plan and perform the audits 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 statements 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 Torres del Plata I Limited
Partnership as of December 31, 1997 and 1996, and the results of its operations,
changes in partners' equity and its cash flows for the years then ended in
conformity with generally accepted accounting principles.

In accordance with Government Auditing Standards, we have also issued a report
dated January 28, 1998, on our consideration of the Partnership's internal
control structure and a report dated January 28, 1998 on its compliance with
laws, regulations, contracts, loan covenants and agreements.

                                          /s/ TORRES LLOMPART, SANCHEZ RUIZ & CO
                                          --------------------------------------



January 28, 1998
License No. 169
San Juan, Puerto Rico

Stamp number 1462219 was affixed
to the original of this report.



<PAGE>   38

                [TORRES LLOMPART, SANCHEZ RUIZ & CO LETTERHEAD]



              INDEPENDENT AUDITORS' REPORT ON FINANCIAL STATEMENTS


PARTNERS
TORRES DEL PLATA I LIMITED PARTNERSHIP
SAN JUAN, PUERTO RICO

We have audited the accompanying balance sheet of Torres del Plata I Limited
Partnership as of December 31, 1996, and the related statements of operations,
partners' equity, and cash flows for the year then ended. These financial
statements are the responsibility of the Partnership's management. Our
responsibility is to express an opinion on these financial statements based on
our audit. The financial statements of Torres del Plata I Limited Partnership as
of December 31, 1995, were audited by other auditors whose report dated January
22, 1996, expressed an unqualified opinion on those statements.

We conducted our audit in accordance with generally accepted auditing standards
and Government Auditing Standards, issued by the Comptroller General of the
United States. 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 statements
presentation. We believe that our audit provides 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 Torres del Plata I Limited
Partnership as of December 31, 1996, and the results of its operations, changes
in partners' equity and cash flows for the year then ended in conformity with
generally accepted accounting principles.

In accordance with Government Auditing Standards, we have also issued a report
dated January 23, 1997, on our consideration of the Partnership's internal
control structure and a report dated January 23, 1997 on its compliance with
laws, regulations, contracts, loan covenants and agreements.

                                          /s/ TORRES LLOMPART, SANCHEZ RUIZ & CO
                                          --------------------------------------

January 23, 1997
License No. 169
San Juan, Puerto Rico

Stamp number 1392913 was
affixed to the original of this report.





<PAGE>   39



                          INDEPENDENT AUDITORS' REPORT


TO THE PARTNERS OF
TERRACE GARDENS LIMITED PARTNERSHIP,
A CALIFORNIA LIMITED PARTNERSHIP:



We have audited the accompanying balance sheets of Terrace Gardens Limited
Partnership, a California Limited Partnership, as of December 31, 1997 and 1996,
and the related statements of operations, changes in partners' equity (deficit)
and cash flows for the years then ended. These financial statements are the
responsibility of the Partnership's management. Our responsibility is to express
an opinion on these financial statements 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 Terrace Gardens Limited
Partnership, a California Limited Partnership, as of December 31, 1997 and 1996,
and the results of its operations and its cash flows for the years then ended in
conformity with generally accepted accounting principles.




San Diego, California
January 23, 1998



<PAGE>   40

                [ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT

To the Partners
100 Sixth Avenue Associates, Limited Partnership
aka Ticino Apartments

We have audited the balance sheets of 100 SIXTH AVENUE ASSOCIATES, LIMITED
PARTNERSHIP AKA TICINO APARTMENTS as of December 31, 1997 and 1996 and the
related statements of operations, changes in partners' equity and cash flows for
each of the three years in the period ended December 31, 1997. These financial
statements are the responsibility of the Partnership's management. Our
responsibility is to express an opinion on these financial statements 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 100 Sixth Avenue Associates,
Limited Partnership as of December 31, 1997 and 1996 and the results of its
operations, changes in partners' equity and cash flows for each of the three
years in the period ended December 31, 1997 in conformity with generally
accepted accounting principles.

The financial statements have been prepared assuming the Partnership will
continue as a going concern. As described in Note 6, insufficient cash flows and
recurring losses from operations raise substantial doubt about the Project's
ability to continue as a going concern. Management's plans regarding these
matters are described in Note 6. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

Our audits were conducted for the purpose of forming an opinion on the financial
statements taken as a whole. The additional financial data are presented for the
purpose of additional analysis and are not a required part of the financial
statements. Such information has been subjected to the auditing procedures
applied in the audits of the financial statements and, in our opinion, is fairly
stated in all material respects in relation to the financial statements taken as
a whole.

                                         /s/ ALTSCHULER, MELVOIN AND GLASSER LLP
                                         ---------------------------------------


Los Angeles, California
March 5, 1998



<PAGE>   41

                    [BLACKMAN & ASSOCIATES, P.C. LETTERHEAD]



                          INDEPENDENT AUDITORS' REPORT


To the Partners
Vinton/Park School Apartments
  Limited Partnership
Omaha, Nebraska


We have audited the accompanying balance sheets of Vinton/Park School Apartments
Limited Partnership (a Nebraska Limited Partnership) as of December 31, 1997 and
1996 and the related statements of operations, changes in partners' capital
accounts and cash flows for the years ended December 31, 1997, 1996 and 1995.

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 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 Vinton/Park School Apartments
Limited Partnership at December 31, 1997 and 1996 and the results of its
operations, changes in partners' capital accounts and cash flows for the years
ended December 31, 1997, 1996 and 1995, in conformity with generally accepted
accounting principles.

                                                 /s/ BLACKMAN & ASSOCIATES, P.C.
                                                 -------------------------------


Omaha, Nebraska
January 23, 1998

<PAGE>   42

                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 1998


1.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        Organization

        National Tax Credit Partners, L.P. (the "Partnership") was formed under
        the California Revised Limited Partnership Act and organized on March 7,
        1989. The Partnership was formed to invest primarily in other limited
        partnerships which own and operate multifamily housing complexes that
        are eligible for low income housing tax credits or, in certain cases,
        for historic rehabilitation tax credits. The general partner of the
        Partnership (the "General Partner") is National Partnership Investments
        Corp., a California corporation ("NAPICO"). Casden Investment
        Corporation owns 100% of NAPICO's stock. The special limited partner of
        the Partnership (the "Special Limited Partner") is PaineWebber T.C.,
        Inc., a Delaware corporation.

        The Partnership originally registered 14,000 units, consisting of 28,000
        Limited Partnership Interests ("LPI"), and warrants to purchase a
        maximum of 14,000 Additional Limited Partnership Interests ("ALPI"). The
        term of the offering expired in June 1990, at which date the Partnership
        raised $59,749,000 from the sale of 16,336 LPI and warrants representing
        7,563 ALPI.

        The General Partner has a 1% interest in operating profits and losses of
        the Partnership. The limited partners will be allocated the remaining
        99% interest in proportion to their respective investments.

        The Partnership shall continue in full force and effect until December
        31, 2029, unless terminated prior to that, pursuant to the partnership
        agreement or law.

        Upon total or partial liquidation of the Partnership or the disposition
        or partial disposition of a project or project interest and distribution
        of the proceeds, the General Partner will be entitled to a property
        disposition fee as mentioned in the partnership agreement. The limited
        partners will have a priority item equal to their invested capital plus
        a 10% priority return as defined in the partnership agreement. This
        property disposition fee may accrue but shall not be paid until the
        limited partners have received distributions equal to 100% of their
        capital contributions plus the 10% priority return.

        Use of Estimates

        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 reported amounts of revenues and expenses
        during the reporting period. Actual results could differ from those
        estimates.

        Method of Accounting for Investments in Limited Partnerships

        The investments in limited partnerships are accounted for using the
        equity method. Acquisition, selection and other costs related to the
        acquisition of the projects acquired are capitalized as part of the
        investment accounts and are being amortized on a straight line basis
        over the estimated lives of the underlying assets, which is generally 30
        years.



                                       5

<PAGE>   43

                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 1998



1.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        Net Loss Per Limited Partnership Interest

        Net loss per limited partnership interest was computed by dividing the
        limited partners' share of net loss by the number of limited partnership
        interests outstanding during the year. The number of limited partnership
        interests was 23,899 for all years presented.

        Cash and Cash Equivalents

        The Partnership considers all highly liquid debt instruments purchased
        with an original maturity of three months or less to be cash
        equivalents.

        Impairment of Long-Lived Assets

        The Partnership reviews long-lived assets to determine if there has been
        any permanent impairment whenever events or changes in circumstances
        indicate that the carrying amount of the asset may not be recoverable.
        If the sum of the expected future cash flows is less than the carrying
        amount of the assets, the Partnership recognizes an impairment loss.
        During 1998, the Partnership recognized an impairment loss of $1,223,000
        related to certain of the investments in local limited partnerships.

2.      INVESTMENTS IN LIMITED PARTNERSHIPS

        The Partnership holds limited partnership interests in 31 local limited
        partnerships (the "Local Partnerships"). As a limited partner of the
        Local Partnerships, the Partnership does not have authority over
        day-to-day management of the Local Partnerships or their properties (the
        "Apartment Complexes"). The general partners responsible for management
        of the Local Partnerships (the "Local Operating General Partners") are
        not affiliated with the General Partner of the Partnership, except as
        discussed below.

        At December 31, 1998, the Local Partnerships own residential projects
        consisting of 2,788 apartment units.

        The Partnership, as a limited partner in each Local Partnership, is
        generally entitled to 99 percent of the operating profits and losses of
        the Local Partnerships. National Tax Credit, Inc. (NTC), an affiliate of
        the General Partner, serves either as a special limited partner or
        non-managing administrative general partner in which case it receives
        .01 percent of operating profits and losses of the Local Partnership, or
        as the Local Operating General Partner of the Local Partnership in which
        case it is entitled to .09 percent of operating profits and losses of
        the Local Partnership. The Partnership is also generally entitled to
        receive 50 percent of the net cash flow generated by the Apartment
        Complexes, subject to repayment of any loans made to the Local
        Partnerships (including loans provided by NTC or an affiliate),
        repayment for funding of development deficit and operating deficit
        guarantees by the Local Operating General Partners or their affiliates
        (excluding NTC and its affiliates), and certain priority payments to the
        Local Operating General Partners other than NTC or its affiliates.




                                        6



<PAGE>   44

                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 1998


2.     INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

       The Partnership's allocable share of losses from Local Partnerships are
       recognized in the financial statements until the related investment
       account is reduced to a zero balance. Losses incurred after the
       investment account is reduced to zero are not recognized. The cumulative
       amount of the unrecognized equity in losses of unconsolidated limited
       partnerships was approximately $15,462,201 and $15,542,236 as of December
       31, 1998 and 1997, respectively.

       Distributions from the Local Partnerships are accounted for as a return
       of capital until the investment balance is reduced to zero or to a
       negative amount equal to further capital contributions required.
       Subsequent distributions received will be recognized as income.

       The following is a summary of the investments in and advances to Local
       Partnerships and reconciliation to the Local Partnerships accounts:


<TABLE>
<CAPTION>
                                                                               1998             1997     
                                                                            ------------    ------------
<S>                                                                         <C>             <C>         
            Investment balance, beginning of year                           $ 14,370,207    $ 17,721,398
            Capital contributions to (recovery from) limited partnerships        455,569        (494,576)
            Capitalized acquisition costs and fees (Note 3)                           --            (305)
            Equity in loss of limited partnerships                            (1,946,271)     (2,059,308)
            Write off of investee partnership                                 (1,223,100)       (560,766)
            Amortization of capitalized acquisition costs and fees              (136,257)       (129,322)
            Distributions recognized as a return of capital                      (98,527)       (106,914)
                                                                            ------------    ------------
            Investment balance, end of year                                 $ 11,421,621    $ 14,370,207
                                                                            ============    ============
</TABLE>

       In 1997, the Partnership received approximately $886,000 from the sale of
       a portion of its limited partner interests in two Local Partnerships.

       The difference between the investment per the accompanying balance sheets
       at December 31, 1998 and 1997, and the equity per the Local Partnerships'
       combined financial statements is due primarily to cumulative unrecognized
       equity in losses of certain Local Partnerships the Partnership's
       recording of capital contributions payable to the Local Partnerships in
       its investment balance and costs capitalized to the investment account.

       Victorian Park

       Victorian Park Associates, which owns a 336-unit Apartment Complex
       located in Illinois, defaulted on its mortgage in July 1991 principally
       because the unaffiliated Local Operating General Partners failed to pay
       $800,000 of real property taxes required under their guarantees. On March
       25, 1992, the Partnership commenced litigation against the Local
       Operating General Partners to enforce its rights. On November 13, 1992
       the Partnership was advised that a Chapter 11 petition in bankruptcy was
       filed by the Local Operating General Partners on behalf of the Local
       Partnership and that the lender, Patrician Mortgage ("Patrician"), had
       accelerated its mortgage. On January 7, 1993, the Partnership obtained an
       order compelling the Local Operating General Partners to perform under
       their Guarantees, which order was reversed by the U.S. Court of Appeals
       for the Seventh Circuit. The Local Operating General Partners' Seventh
       Amended Plan of Reorganization (the "Plan") is now pending approval.
       Pursuant to the Plan, Patrician is required to reissue and/or reduce the
       principal on the first mortgage bonds and the Local Operating General
       Partners are required to (i) pay $1,000,000 cash to implement the Plan
       and (ii) pay an agreed upon monthly



                                        7


<PAGE>   45

                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 1998



2.     INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

       guarantee payment. No assurances can be given that the Plan will be
       successfully implemented. As of December 31, 1998 and 1997, the
       Partnership's carrying value of the investment in the Victorian Local
       Partnership (which represents approximately 5.7 percent of the
       Partnership's total equity initially invested in Local Partnerships) was
       zero.

       Summit I, II and III

       The general contractor for three related Local Partnerships, Summit I,
       Summit II and Summit III, initiated a lawsuit in December 1992 against
       the Local Partnerships and the Partnership seeking damages in the amount
       of approximately $600,000 allegedly due pursuant to the respective
       general contracts plus damages for alleged misrepresentations and
       punitive damages. The Partnership believes that the general contractor's
       claims are barred and/or subject to offset and it has filed responsive
       pleadings. The Partnership has not accrued any liability in the
       accompanying financial statements as of December 31, 1998 and 1997. The
       lawsuit has been dormant for more than four years. Occupancy levels at
       the three related Local Partnerships, Summit I, II, and III (Wallace,
       Bergdoll, and Chandler School located in Philadelphia) were 76%, 100%,
       and 96%, respectively, at December 31, 1998, and the properties have been
       operating at a deficit. The local general partner is currently attempting
       to negotiate discounted payments and/or payment plans for outstanding
       payables which, if unsuccessful, could result in foreclosure proceedings
       on all three properties. In 1996, the aggregate carrying value of the
       investments in Summit I, Summit II and Summit III of approximately
       $2,290,000 was written off. Summits I, II and III represent 3.2%, 1.4%
       and 4.6%, respectively, of NTCP's original portfolio investment.

       Meadows

       The Meadows Apartments (the "Local Partnership") is a 114-unit building
       located in Ypsilanti, Michigan. The first mortgage loan matured on May
       15, 1996. After the lender refused to negotiate an extension of the loan,
       the Local Partnership filed Chapter 11 bankruptcy proceedings to avert
       foreclosure. A plan of reorganization for the Local Partnership (the
       "Plan") was approved by the bankruptcy court on December 16, 1996. Under
       the Plan, the existing loan in the principal amount of $2,890,000, at an
       interest rate of 10%, was reduced to $2,100,000 with an interest rate of
       9%. In exchange, the lender received one-third of NTCP's local
       partnership interest, including anticipated allocations of housing tax
       credits in the amount of approximately $488,500. The property operated at
       an occupancy level of 98% as of December 1998, and attained break-even
       levels of operations during 1998 and 1997. As of December 31, 1998 and
       1997, the Partnership's carrying value of the investment in the Meadows
       Apartments was zero.

       Glenark

       Pursuant to the terms of a workout, dated January 11, 1995 (the
       "Workout") agreed upon between the parties relating to the resolution of
       an existing default under the first mortgage loan encumbering Glenark
       Landing, annual payments of $42,800 for a five year term, totaling
       $214,000, are due to the Rhode Island Housing and Mortgage Finance
       Corporation (the "Lender").

        The Partnership's investment in Glenark was zero at December 31, 1998
        and 1997.



                                        8


<PAGE>   46


                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 1998



2.     INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

       Holden Village & Ticino Apartments

       Holden Village and Ticino Apartments, located in Seattle, Washington,
       maintained average occupancy levels of 97% and 91%, respectively, and
       have been experiencing operating deficits. The high cost of servicing the
       debt was the largest contributing factor associated with the deficit
       operations. In January 1998, NTCP was successful in negotiating an
       interest rate reduction with the lender for each of the properties. Based
       on the loan modifications, the operating performance of each property is
       expected to improve. The Partnership's total investment in Holden Village
       and Ticino Apartments of approximately $1,223,000 was written off in
       1998.

       Dynes Village

       The Dynes Village Apartments complex is operating at a deficit and the
       first mortgage loan encumbering the property was delinquent until it was
       brought current by NTCP in November 1997. In addition, the property has
       been audited by the IRS with respect to tenant qualifications performed
       by the prior local operating general partner. The IRS has disqualified
       all future housing tax credits based on what they consider non-compliance
       by the prior local operating general partner. As a result, the
       Partnership's investment in Dynes Village of $560,766 was written off
       during 1997.

       Blue Lake

       Pursuant to the terms of a loan workout, dated March 25, 1995 (the
       "Workout"), NTCP is required to contribute an additional $541,300 to the
       local partnership over a ten year period. In exchange, the debt service
       on the property is payable out of net cash flow. During 1998 and 1997,
       approximately $62,000 and $63,000, respectively, was paid by NTCP to the
       local partnership under the Workout (see Note 3). The Partnership's
       investment in Blue Lake at December 31, 1998 and 1997 was zero.

       Rose City

       During 1997, the Oregon Housing and Community Services Department
       ("Department") inspected Rose City Village Limited Partnership's
       compliance with the low-income housing credit provisions of the Internal
       Revenue Code, and determined that the Partnership was not in compliance.
       The Department filed Form 8823, Low-Income Housing Credit Agencies Report
       of Noncompliance, with the Internal Revenue Service. Management believes
       the instances of noncompliance are now corrected; however, as of the date
       of this report, resolution of this matter by the Department and the
       Internal Revenue Service is still outstanding. The effect, if any, of the
       noncompliance on the financial statements of the Partnership cannot be
       determined at this date. The Partnership's investment in Rose City at
       December 31, 1998 was $532,337.



                                        9



<PAGE>   47


                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 1998



2.     INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

       Selected financial information from the combined financial statements of
       the Local Partnerships at December 31, 1998 and 1997 and for each of the
       three years in the period ended December 31, 1998 is as follows:


<TABLE>
<CAPTION>
                                 Balance Sheets
                                                                 1998         1997   
                                                               ---------    ---------
                                                                   (in thousands)
<S>                                                            <C>          <C>      
            Land and buildings, net                            $  99,498    $ 102,994
                                                               =========    =========

            Total assets                                       $ 105,811    $ 109,481
                                                               =========    =========

            Mortgages payable secured by real property         $  87,586    $  87,811
                                                               =========    =========

            Total liabilities                                  $ 107,672    $ 107,169
                                                               =========    =========

            Deficiency of National Tax Credit Partners, L.P.   $  (6,628)   $  (3,216)
                                                               =========    =========

            Equity of other partners                           $   4,767    $   5,529
                                                               =========    =========
</TABLE>



<TABLE>
<CAPTION>
                            Statements of Operations

                                                      1998        1997        1996   
                                                    --------    --------    --------
                                                             (in thousands)
<S>                                                 <C>         <C>         <C>     
            Total revenues                          $ 17,699    $ 18,087    $ 17,624
                                                    ========    ========    ========

            Interest expense                        $  7,538    $  7,687    $  7,608
                                                    ========    ========    ========

            Depreciation                            $  4,325    $  4,269    $  4,371
                                                    ========    ========    ========

            Total expenses                          $ 21,408    $ 21,546    $ 33,530
                                                    ========    ========    ========

            Net loss                                $ (3,710)   $ (3,459)   $(15,906)
                                                    ========    ========    ========

            Net loss allocable to the Partnership   $ (3,374)   $ (3,466)   $(15,436)
                                                    ========    ========    ========
</TABLE>



                                       10


<PAGE>   48

                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 1998



2.      INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

        An affiliate of the General Partner is the Local Operating General
        Partner in sixteen of the Local Partnerships included above, and another
        affiliate receives property management fees of approximately 5 percent
        of gross revenues from two of these Local Partnerships. The following
        sets forth the significant combined data for the Local Partnerships in
        which an affiliate of the General Partner was the Local Operating
        General Partner, reflected in the accompanying financial statements
        using the equity method of accounting:


<TABLE>
<CAPTION>
                                                                 1998        1997        1996   
                                                               --------    --------    --------
                                                                        (in thousands)
<S>                                                            <C>         <C>         <C>      
            Total assets                                       $ 47,383    $ 48,987
                                                               ========    ========

            Total liabilities                                  $ 48,083    $ 48,133
                                                               ========    ========

            Deficiency of National Tax Credit Partners, L.P.   $ (4,674)   $ (3,177)
                                                               ========    ========

            Equity of other partners                           $  3,973    $  4,030
                                                               ========    ========

            Total revenue                                      $  7,328    $  7,503    $  7,475
                                                               ========    ========    ========

            Net loss                                           $ (2,273)   $ (1,971)   $ (8,140)
                                                               ========    ========    ========
</TABLE>

3.      CAPITAL CONTRIBUTIONS PAYABLE

        Capital contributions payable represents approximately $70,000 due
        annually, until paid in full, for the investment in the Blue Lake Local
        Partnership. The capital contributions payable are unsecured and
        non-interest bearing.

4.      RELATED-PARTY TRANSACTIONS

        Under the terms of the Restated Certificate and Agreement of the Limited
        Partnership, the Partnership is obligated to the General Partner and the
        Special Limited Partner for the following fees:

        (a)    An annual Partnership management fee in an annual amount equal to
               0.5 percent of invested assets (as defined in the partnership
               agreement) is payable to the General Partner and Special Limited
               Partner. Partnership management fees expensed were $692,956 for
               1998, 1997 and 1996. At December 31, 1998 and 1997, $5,420,677
               and $4,727,721, respectively, was due the General Partner and
               Special Limited Partner.

               As of December 31, 1998, the fees and expenses due the General
               Partner and Special Limited Partner exceeded the Partnership's
               cash. The partners, during the forthcoming year, will not demand
               payment of amounts due in excess of such cash or such that the
               Partnership would not have sufficient operating cash; however,
               the Partnership will remain liable for all such amounts.

        (b)    A property disposition fee is payable to the General Partner in
               an amount equal to the lesser of (i) one-half of the competitive
               real estate commission that would have been charged by
               unaffiliated third parties



                                       11

<PAGE>   49

                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 1998


4.      RELATED-PARTY TRANSACTIONS (CONTINUED)

               providing comparable services in the area where the apartment
               complex is located, or (ii) 3 percent of the sales price received
               in connection with the sale or disposition of the apartment
               complex or local partnership interest, but in no event will the
               property disposition fee and all amounts payable to unaffiliated
               real estate brokers in connection with any such sale exceed in
               the aggregate, the lesser of the competitive rate (as described
               above) or 6 percent of such sale price. Receipt of the property
               disposition fee will be subordinated to the distribution of sale
               or refinancing proceeds by the Partnership until the limited
               partners have received distributions from sale or refinancing
               proceeds in an aggregate amount equal to (i) their 10 percent
               priority return for any year not theretofore satisfied (as
               defined in the partnership agreement) and (ii) an amount equal to
               the aggregate adjusted investment (as defined in the partnership
               agreement) of the limited partners. No disposition fees have been
               paid.

        (c)    The Partnership reimburses certain expenses to the General
               Partner. The reimbursement due to the General Partner was $0,
               $38,544 and $36,744 during 1998, 1997 and 1996, respectively, and
               included in general and administrative expenses.

        NTC is the Local Operating General Partner in sixteen of the
        Partnership's 31 Local Partnerships. In addition, NTC is either a
        special limited partner or a non-managing, administrative general
        partner in each Local Partnership.

        An affiliate of the General Partner is responsible for the on-site
        property management for two Local Partnerships (Note 2). The Local
        Partnerships paid the affiliate property management fees of $59,249,
        $67,157 and $65,049 in 1998, 1997 and 1996, respectively.

5.      INCOME TAXES

        No provision has been made for income taxes in the accompanying
        financial statements since such taxes, if any, are the liability of the
        individual partners. The major differences in tax and financial
        statement losses result from the use of different bases and depreciation
        methods for the properties held by the Local Partnerships. Additional
        differences in tax and financial losses arises when financial statement
        losses are not recognized after the investment balance has been reduced
        to zero or to a negative amount equal to further capital contributions
        required.

6.      CONTINGENCIES

        The General Partner of the Partnership is a plaintiff in various
        lawsuits and has also been named as a defendant in other lawsuits
        arising from transactions in the ordinary course of business. In
        addition, the Partnership is involved in several suits. In the opinion
        of management and the General Partner, the claims will not result in any
        material liability to the Partnership (Note 2).

        The Partnership has assessed the potential impact of the Year 2000
        computer systems issue on its operations. The Partnership believes that
        no significant actions are required to be taken by the Partnership to
        address the issue and that the impact of the Year 2000 computer systems
        issue will not materially affect the Partnership's future operating
        results or financial condition.



                                       12


<PAGE>   50

                       NATIONAL TAX CREDIT PARTNERS, L.P.
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 1998



7.      FAIR VALUE OF FINANCIAL INSTRUMENTS

        Statement of Financial Accounting Standards No. 107, "Disclosure about
        Fair Value of Financial Instruments," requires disclosure of fair value
        information about financial instruments, when it is practicable to
        estimate that value. The operations generated by the investee limited
        partnerships, which account for the Partnership's primary source of
        funds, are subject to various government rules, regulations and
        restrictions which make it impracticable to estimate the fair value of
        the accrued fees due to partners. The carrying amount of other assets
        and liabilities reported on the balance sheets that require such
        disclosure approximates fair value due to their short-term maturity.

8.      FOURTH-QUARTER ADJUSTMENT

        The Partnership's policy is to record its equity in the loss of limited
        partnerships on a quarterly basis using estimated financial information
        furnished by the various local operating general partners. The equity in
        loss reflected in the accompanying annual financial statements is based
        primarily upon audited financial statements of the investee limited
        partnerships. The increase, in equity in loss of approximately
        $988,000, between the estimated nine-month equity in loss and the
        actual 1998 year end equity in loss has been recorded in the fourth
        quarter.




                                       13


<PAGE>   51


                        NATIONAL TAX CREDIT PARTNERS, L.P.             SCHEDULE
                    INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS
                  YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996




<TABLE>
<CAPTION>
                                                YEAR ENDED DECEMBER 31, 1998
                            ---------------------------------------------------------------------------
                              BALANCE                                CAPITALIZED                       
  LIMITED                    JANUARY 1,           CAPITAL            ACQUISITION             CASH      
PARTNERSHIPS                   1998            CONTRIBUTIONS            COSTS            DISTRIBUTIONS 
                            ------------       -------------         ------------        ------------- 
<S>                         <C>                 <C>                  <C>                  <C>          
Apple Tree                  $    157,169       $                     $                    $     (1,900)
Blue Lake                              0                                                               
ComFed                                 0                                                               
Concept I & II                   131,929              75,000                                           
Countryview Columbus           1,466,729             (76,827)                                          
Dickens                                0                                                               
Dynes Village                          0                   0                                           
Genoa Plaza                      131,364                                                        (5,691)
Glenark                                0              28,874 
Grand Meadows                    899,405                                                               
Grinnell Park                    111,783                                                               
Hickory Green                    394,244                                                               
Holden Village                   809,801             104,651                                           
Kimberly Court                   126,411                                                               
The Meadows                            0                                                               
Mountain View I                  966,090                                                               
Mountain View II               1,308,716                                                               
Newbury Place                  2,119,337                                                               
North Liberty Park                10,105                                                               
Paris Hotel                      303,152                                                               
Rolling Hills                    116,938                                                       (49,445)
Rose City                        685,558                                                        (1,000)
Summit I                               0                                                               
Summit II                              0                                                               
Summit III                             0                                                               
Torres de Plata I                 45,328                                                        (6,450)
Terrace Gardens                1,855,253                                                       (17,708)
Ticino                           496,516             323,871                                           
Tyrone Elderly                   969,112                                                       (16,333)
Victorian Park                         0                                                               
Vinton Park School             1,265,267                                                               
                            ------------        ------------         ------------         ------------ 
                            $ 14,370,207        $    455,569         $          0         $    (98,527)
                            ============        ============         ============         ============ 
                                                                                         
<CAPTION>
                                                   YEAR ENDED DECEMBER 31, 1998
                            --------------------------------------------------------------------------
                               EQUITY            AMORTIZATION             BALANCE           CAPITAL
  LIMITED                      INCOME           OF CAPITALIZED         DECEMBER 31,      CONTRIBUTIONS
PARTNERSHIPS                   (LOSS)             ACQ. COSTS               1998             PAYABLE
                            ------------        -------------         ------------        ------------
<S>                         <C>                  <C>                  <C>                 <C>         
Apple Tree                  $    (11,307)        $     (1,418)        $    142,544        $    266,841
Blue Lake                              0                    0                    0
ComFed                                 0                    0                    0
Concept I & II                  (200,611)              (6,318)                   0
Countryview Columbus            (139,876)             (13,007)           1,237,019
Dickens                                0                    0                    0
Dynes Village                          0                    0                    0
Genoa Plaza                      (26,302)                (529)              98,842
Glenark                          (28,874)                   0                    0
Grand Meadows                    (88,936)              (3,812)             806,657
Grinnell Park                     (5,880)                (215)             105,688
Hickory Green                    (44,033)              (5,279)             344,932
Holden Village                  (906,855)              (7,597)                   0
Kimberly Court                   (48,948)              (1,663)              75,800
The Meadows                                                 0                    0
Mountain View I                  (70,540)              (7,990)             887,560
Mountain View II                 (77,420)              (7,990)           1,223,306
Newbury Place                    (88,125)             (14,698)           2,016,514
North Liberty Park                (9,188)                (917)                   0
Paris Hotel                     (300,318)              (2,834)                   0
Rolling Hills                    (58,692)              (8,800)                   0
Rose City                       (148,280)              (3,941)             532,337
Summit I                                                                         0
Summit II                                                                        0
Summit III                                                                       0
Torres de Plata I                (18,479)             (20,399)                   0
Terrace Gardens                  (78,096)             (13,253)           1,746,196
Ticino                          (815,381)              (5,006)                   0
Tyrone Elderly                    26,322               (5,188)             973,913
Victorian Park                                                                   0
Vinton Park School               (29,552)              (5,403)           1,230,312
                            ------------         ------------         ------------        ------------
                            $ (3,169,371)        $   (136,257)        $ 11,421,621        $    266,841
                            ============         ============         ============        ============
</TABLE>








<PAGE>   52

                       NATIONAL TAX CREDIT PARTNERS, L.P.              SCHEDULE
                    INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS
                  YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996



<TABLE>
<CAPTION>
                                               YEAR ENDED DECEMBER 31, 1997
                            ---------------------------------------------------------------------------
                              BALANCE                                CAPITALIZED                       
  LIMITED                    JANUARY 1,           CAPITAL            ACQUISITION             CASH      
PARTNERSHIPS                   1997            CONTRIBUTIONS            COSTS            DISTRIBUTIONS 
                            ------------       -------------         ------------        ------------- 
<S>                         <C>                 <C>                  <C>                  <C>          
Apple Tree                  $    173,648        $                    $                    $     (1,900)
Blue Lake                              0                                                               
ComFed                                 0                                                               
Concept I & II                   140,282                                                               
Countryview Columbus           2,230,431            (625,582)                                          
Dickens                          117,438                                                               
Dynes Village                    630,428              53,900                                           
Genoa Plaza                      152,794                                                        (3,779)
Glenark                                0              36,400                                           
Grand Meadows                    996,605                                                               
Grinnell Park                    119,821                                                               
Hickory Green                    432,097                                                               
Holden Village                   944,835              22,000                                           
Kimberly Court                   173,339                                                        (1,724)
The Meadows                            0             262,492                                           
Mountain View I                1,057,747                                                        (6,000)
Mountain View II               1,417,710                                                        (3,000)
Newbury Place                  2,431,711             (10,000)                                          
North Liberty Park                34,268                                                               
Paris Hotel                      330,589                                                               
Rolling Hills                    777,946                                                       (49,445)
Rose City                        604,078            (260,000)                                   (1,750)
Summit I                               0               2,354                                           
Summit II                              0              10,023                                           
Summit III                             0               5,837                                           
Torres de Plata I                141,674                                                        (6,450)
Terrace Gardens                1,975,852                                                               
Ticino                           588,003               8,000                 (305)                     
Tyrone Elderly                   959,066                                                       (32,866)
Victorian Park                         0                                                               
Vinton Park School             1,291,036                                                               
                            ------------        ------------         ------------         ------------ 
                            $ 17,721,398        $   (494,576)        $       (305)        $   (106,914)
                            ============        ============         ============         ============ 

<CAPTION>
                                                YEAR ENDED DECEMBER 31, 1997
                           --------------------------------------------------------------------------
                              EQUITY            AMORTIZATION             BALANCE           CAPITAL
  LIMITED                     INCOME           OF CAPITALIZED         DECEMBER 31,      CONTRIBUTIONS
PARTNERSHIPS                  (LOSS)             ACQ. COSTS               1997             PAYABLE
                           ------------        --------------        -------------      -------------
<S>                        <C>                  <C>                  <C>                 <C>         
Apple Tree                 $    (13,161)        $     (1,418)        $    157,169        $
Blue Lake                             0                    0                    0              329,030
ComFed                                0                    0                    0
Concept I & II                   (2,035)              (6,318)             131,929
Countryview Columbus           (125,113)             (13,007)           1,466,729
Dickens                        (117,438)                   0                    0
Dynes Village                  (671,696)             (12,632)                   0
Genoa Plaza                     (17,122)                (529)            131,364
Glenark                         (36,400)                   0                   0
Grand Meadows                   (93,388)              (3,812)             899,405
Grinnell Park                    (7,823)                (215)             111,783
Hickory Green                   (32,574)              (5,279)             394,244
Holden Village                 (149,437)              (7,597)             809,801
Kimberly Court                  (43,541)              (1,663)             126,411
The Meadows                    (262,492)                   0                    0
Mountain View I                 (77,667)              (7,990)             966,090
Mountain View II                (98,004)              (7,990)           1,308,716
Newbury Place                  (287,676)             (14,698)           2,119,337
North Liberty Park              (23,246)                (917)              10,105
Paris Hotel                     (24,603)              (2,834)             303,152
Rolling Hills                  (602,763)              (8,800)             116,938
Rose City                       347,171               (3,941)             685,558
Summit I                         (2,354)
Summit II                       (10,023)
Summit III                       (5,837)
Torres de Plata I               (89,064)                (832)              45,328
Terrace Gardens                (107,346)             (13,253)           1,855,253
Ticino                          (94,176)              (5,006)             496,516
Tyrone Elderly                   48,100               (5,188)             969,112
Victorian Park                                                                  0
Vinton Park School              (20,366)              (5,403)           1,265,267
                           ------------         ------------         ------------        ------------
                           $ (2,620,074)        $   (129,322)        $ 14,370,207        $    329,030
                           ============         ============         ============        ============
</TABLE>



<PAGE>   53


                         NATIONAL TAX CREDIT PARTNERS, L.P.           SCHEDULE
                   INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS         (CONTINUED)
                  YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996




<TABLE>
<CAPTION>
                                                YEAR ENDED DECEMBER 31, 1996
                            ---------------------------------------------------------------------------
                              BALANCE                                CAPITALIZED                       
  LIMITED                    JANUARY 1,           CAPITAL            ACQUISITION             CASH      
PARTNERSHIPS                   1996            CONTRIBUTIONS            COSTS            DISTRIBUTIONS 
                            ------------       -------------         ------------        ------------- 
<S>                         <C>                 <C>                  <C>                  <C>          
Apple Tree                  $    182,313       $                     $                   $     (1,900) 
Blue Lake                              0                                                               
ComFed                                 0                                                               
Concept I & II                   250,778                                                               
Countryview Columbus           2,215,062             104,187                                           
Dickens                          266,437                                                               
Dynes Village                    756,218                                                               
Genoa Plaza                      173,424                                                               
Glenark                                0              34,200                                           
Grand Meadows                  1,085,626                                                               
Grinnell Park                    127,321                                                               
Hickory Green                    528,049                (369)                                          
Holden Village                 1,084,955              43,911                                           
Kimberly Court                   219,210                                                        (1,724)
The Meadows                            0             (28,880)                                          
Mountain View I                1,146,496                                                               
Mountain View II               1,531,416                                                               
Newbury Place                  2,572,173              18,254                                           
North Liberty Park                56,746                                                               
Paris Hotel                      354,293                                                        (4,000)
Rolling Hills                  1,185,549                                                       (49,445)
Rose City                        585,697                                                       (23,333)
Summit I                         607,899              17,950                                           
Summit II                      1,055,009                                                               
Summit III                       632,737                                                               
Torres de Plata I                257,288                                                        (6,450)
Terrace Gardens                2,117,731                                                               
Ticino                           655,731              34,563                                           
Tyrone Elderly                   924,479                                                               
Victorian Park                         0                                                               
Vinton Park School             1,351,186                                                               
                            ------------        ------------         ------------         ------------ 
                            $ 21,923,823        $    223,816         $          0         $    (86,852)
                            ============        ============         ============         ============ 

<CAPTION>
                                                      YEAR ENDED DECEMBER 31, 1996
                            ---------------------------------------------------------------------------
                                EQUITY            AMORTIZATION             BALANCE           CAPITAL
  LIMITED                       INCOME           OF CAPITALIZED         DECEMBER 31,      CONTRIBUTIONS
PARTNERSHIPS                    (LOSS)             ACQ. COSTS               1996             PAYABLE
                             ------------        --------------        -------------      -------------
<S>                          <C>                  <C>                  <C>                 <C>         
Apple Tree                  $     (5,347)        $     (1,418)        $    173,648        $
Blue Lake                               0                    0                    0             392,300
ComFed                                  0                    0                    0
Concept I & II                   (104,178)              (6,318)             140,282
Countryview Columbus              (75,811)             (13,007)           2,230,431
Dickens                          (145,751)              (3,248)             117,438
Dynes Village                    (113,158)             (12,632)             630,428
Genoa Plaza                       (20,101)                (529)             152,794
Glenark                           (34,200)                   0                    0
Grand Meadows                     (85,209)              (3,812)             996,605
Grinnell Park                      (7,285)                (215)             119,821
Hickory Green                     (90,304)              (5,279)             432,097
Holden Village                   (176,434)              (7,597)             944,835
Kimberly Court                    (42,484)              (1,663)             173,339
The Meadows                        28,880                    0                    0
Mountain View I                   (80,759)              (7,990)           1,057,747
Mountain View II                 (105,715)              (7,991)           1,417,710
Newbury Place                    (144,018)             (14,698)           2,431,711
North Liberty Park                (21,561)                (917)              34,268
Paris Hotel                       (16,870)              (2,834)             330,589
Rolling Hills                    (349,358)              (8,800)             777,946
Rose City                          45,655               (3,941)             604,078
Summit I                         (617,772)              (8,077)                   0
Summit II                      (1,047,145)              (7,864)                   0
Summit III                       (624,958)              (7,779)                   0
Torres de Plata I                (108,332)                (832)             141,674
Terrace Gardens                  (128,626)             (13,253)           1,975,852
Ticino                            (97,285)              (5,006)             588,003
Tyrone Elderly                     39,775               (5,188)             959,066
Victorian Park                          0                    0                    0
Vinton Park School                (54,747)              (5,403)           1,291,036
                             ------------         ------------         ------------        ------------
                             $ (4,183,098)        $   (156,291)        $ 17,721,398        $    392,300
                             ============         ============         ============        ============
</TABLE>





<PAGE>   54
                                                                    SCHEDULE III
                                                                     (Continued)



              REAL ESTATE AND ACCUMULATED DEPRECIATION OF PROPERTY
                           HELD BY LOCAL PARTNERSHIPS
                          IN WHICH NTCP HAS INVESTMENTS
                                DECEMBER 31, 1998



NOTES:          1.      Each Local Partnership has developed and now owns and
                        operates an Apartment Complex. Substantially all project
                        costs, including construction period interest expense,
                        were capitalized by the Local Partnerships.

                2.      Depreciation is provided for by various methods over the
                        estimated useful lives of the Apartment Complexes. The
                        estimated composite useful lives of the buildings are
                        generally from 25 to 40 years.

                3.      Investments in property and equipment:


<TABLE>
<CAPTION>
                                                               Buildings,
                                                              Furnishings,
                                           Land                 Equipment               Total
                                        -------------         -------------         -------------
<S>                                     <C>                   <C>                   <C>          
Balance, January 1, 1996                $  10,404,347         $ 138,752,232         $ 149,156,579

Net dispositions during the year              (48,350)          (13,726,709)          (13,775,059)
                                        -------------         -------------         -------------

Balance, December 31, 1996                 10,355,997           125,025,523           135,381,520

Net dispositions during the year             (232,400)             (415,672)             (648,072)
                                        -------------         -------------         -------------

Balance, December 31, 1997                 10,123,597           124,609,851           134,733,448

Net addition during the year                        0             1,716,284             1,716,284
                                        -------------         -------------         -------------

Balance, December 31, 1998              $  10,123,597         $ 126,326,135         $ 136,449,732
                                        =============         =============         =============
</TABLE>




<PAGE>   55

PART III.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT:

NATIONAL TAX CREDIT PARTNERS, L.P. (the "Partnership") has no directors or
executive officers of its own.

Prior to December 30, 1998, NAPICO was a wholly owned subsidiary of Casden
Investment Corporation ("CIC"), which is wholly owned by Alan I. Casden. On
December 30, 1998, Casden Properties Operating Partnership, L.P. (the "Operating
Partnership"), a majority owned subsidiary of Casden Properties Inc., a real
estate investment trust organized by Alan I. Casden, purchased a 95.25% economic
interest in NAPICO. The following biographical information is presented for the
directors and executive officers of NAPICO with principal responsibility for the
Partnership's affairs.

CHARLES H. BOXENBAUM, 69, Chairman of the Board of Directors and Chief Executive
Officer of NAPICO.

Mr. Boxenbaum has been associated with NAPICO since its inception. He has been
active in the real estate industry since 1960, and prior to joining NAPICO was a
real estate broker with the Beverly Hills firm of Carl Rhodes Company.

Mr. Boxenbaum has been a guest lecturer at national and state realty
conventions, certified properties exchanger's seminars, Los Angeles Town Hall,
National Association of Home Builders, International Council of Shopping
Centers, Society of Conventional Appraisers, California Real Estate Association,
National Institute of Real Estate Brokers, Appraisal Institute, various mortgage
banking seminars, and the North American Property Forum held in London, England.
In 1963, he was the winner of the Snyder Award, the highest annual award offered
by the National Association of Real Estate Boards for Best Exchange. He is one
of the founders and a past director of the First Los Angeles Bank, organized in
November 1974. Mr. Boxenbaum was a member of the Board of Directors of the
National Housing Council. Mr. Boxenbaum received his Bachelor of Arts degree
from the University of Chicago.

BRUCE E. NELSON, 47, President and a director of NAPICO.

Mr. Nelson joined NAPICO in 1980 and became President in February 1989. He is
responsible for the operations of all NAPICO sponsored limited partnerships.
Prior to that he was primarily responsible for the securities aspects of the
publicly offered real estate investment programs. Mr. Nelson is also involved in
the identification, analysis, and negotiation of real estate investments.

From February 1979 to October 1980, Mr. Nelson held the position of Associate
General Counsel at Western Consulting Group, Inc., private residential and
commercial real estate syndicators. Prior to that time, Mr. Nelson was engaged
in the private practice of law in Los Angeles. Mr. Nelson received his Bachelor
of Arts degree from the University of Wisconsin and is a graduate of the
University of Colorado School of Law. He is a member of the State Bar of
California and is a licensed real estate broker in California and Texas.

ALAN I. CASDEN, 53, Chairman of The Casden Company, an affiliate of Casden
Properties (formerly CoastFed Properties), a director and member of the audit
committee of NAPICO, and chairman of the Executive Committee of NAPICO.

Mr. Casden is Chairman of the Board, Chief Executive Officer and sole
shareholder of The Casden Company and Casden Investment Company. Prior to that,
he was the President and chairman of Mayer Group, Inc., which he joined in 1975.
He is also chairman of Mayer Management, Inc., a real estate management firm.
Mr. Casden has been involved in approximately $3 billion of real estate
financings and sales and has been responsible for the development and
construction of more than 12,000 apartment units and 5,000 single-family homes
and condominiums.




<PAGE>   56

Mr. Casden is a member of the American Institute of Certified Public Accountants
and of the California Society of Certified Public Accountants. Mr. Casden is a
member of the advisory board of the National Multi-Family Housing Conference,
the Multi-Family Housing Council, and the President's Council of the California
Building Industry Association. He also serves on the advisory board to the
School of Accounting of the University of Southern California. He holds a
Bachelor of Science degree and a Masters in Business Administration degree from
the University of Southern California.

HENRY C. CASDEN, 55, President, Chief Operating Officer and Secretary of The
Casden Company and a director and secretary of NAPICO.

Mr. Casden has been President and Chief Operating Officer of The Casden Company,
as well as a director of NAPICO since February 1988. He became secretary of both
companies in late 1994. From 1982 to 1988, Mr. Casden was of counsel and a
partner in the Los Angeles law firm of Troy, Casden & Gould. From 1978 to 1981,
he was of counsel and a partner in the Los Angeles law firm of Loeb & Loeb. From
1972 to 1978, Mr. Casden was a member of the Beverly Hills law firm of Fink &
Casden, Professional Corporation.

Mr. Casden received his Bachelor of Arts degree from the University of
California at Los Angeles, and is a graduate of the University of San Diego Law
School. Mr. Casden is a member of the State Bar of California and has numerous
professional affiliations.

PAUL PATIERNO, 42, Chief Financial Officer.

Mr. Patierno joined NAPICO in 1998 and is responsible for its financial affairs,
as well as the limited partnerships sponsored by it. From 1995 until joining
NAPICO in September 1998, Mr. Patierno was a senior manager in the affordable
housing group of Altschuler, Melvoin and Glasser LLP, a national public
accounting firm. From 1990 to 1995, he practiced public accounting with a firm
specializing in real estate syndication. Mr. Patierno received his bachelor of
science degree in accounting from California State University at Northridge, and
is a member of the American Institute of Certified Public Accountants and the
California Society of Certified Public Accountants.

PATRICIA W. TOY, 69, Senior Vice President - Communications and Assistant
Secretary.

Mrs. Toy joined NAPICO in 1977, following her receipt of an MBA from the
Graduate School of Management, UCLA. From 1952 to 1956, Mrs. Toy served as a
U.S. Naval Officer in communications and personnel assignments. She holds a
Bachelor of Arts Degree from the University of Nebraska.

MARK L. WALTHER, 38, Executive Vice President, General Counsel and Assistant
Secretary.

Mr. Walther joined NAPICO in 1987 and is responsible for the legal affairs of
the NAPICO sponsored limited partnerships. Prior to joining NAPICO, Mr. Walther
worked in the San Francisco law firm of Browne and Kahn which specialized in
construction litigation. Mr. Walther received his Bachelor of Arts Degree in
Political Science from the University of California, Santa Barbara and is a
graduate of the University of California, Davis, School of Law. He is a member
of the State Bar of Hawaii.

NAPICO and several of its officers, directors and affiliates, including Charles
H. Boxenbaum, Bruce E. Nelson and Alan I. Casden, consented to the entry, on
June 25, 1997, of an administrative cease and desist order by the U.S.
Securities and Exchange Commission (the "Commission"), without admitting or
denying any of the findings made by the Commission. The Commission found that
NAPICO and others had violated certain federal securities laws in connection
with transactions unrelated to the Partnership. The Commission's order did not
impose any cost, burden or penalty on any partnership managed by NAPICO and does
not impact NAPICO's ability to serve as the Partnership's Managing General
Partner.



<PAGE>   57

ITEM 11. MANAGEMENT REMUNERATION AND TRANSACTIONS:

National Tax Credit Partners, L.P. has no officers, employees, or directors.
However, under the terms of the Restated Certificate and Agreement of Limited
Partnership, the Partnership is obligated to the General Partner and Special
Limited Partner for the following fees:

(a)     An annual partnership management fee in an amount equal to 0.5 percent
        of invested assets (as defined) is payable to the General Partner and
        Special Limited Partner. For each of the years ended December 31, 1998,
        1997 and 1996, fees of $692,956 have been incurred.

(b)     A property disposition fee is payable to the General Partner in an
        amount equal to the lesser of (i) one-half of the competitive real
        estate commission that would have been charged by unaffiliated third
        parties providing comparable services in the area where the Apartment
        Complex is located, or (ii) 3 percent of the sale price received in
        connection with the sale or disposition of the Apartment Complex or
        Local Partnership Interest, but in no event will the Property
        Disposition Fee and all amounts payable to unaffiliated real estate
        brokers in connection with any such sale exceed in the aggregate the
        lesser of the competitive rate (as described above) or 6 percent of such
        sale price. Receipt of the Property Disposition Fee will be subordinated
        to the distribution of Sale or Refinancing Proceeds by the Partnership
        until the Limited Partners have received distributions of Sale or
        Refinancing Proceeds in an aggregate amount equal to (i) their 10
        percent Priority Return for any year not theretofore satisfied and (ii)
        an amount equal to the aggregate adjusted investment (as defined) of the
        limited partners. No disposition fees have been paid.

(c)     The Partnership reimburses certain expenses to the General Partner. For
        the years ended December 31, 1998, 1997 and 1996, $0, $38,544 and
        $36,744, respectively, has been paid.

(d)     An affiliate of the General Partner is responsible for the on-site
        property management for two Local Partnerships. The Local Partnerships
        paid the affiliate property management fees of $67,157, $67,157, $65,049
        in 1998, 1996 and 1996, respectively.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT:

(a)     Security Ownership of Certain Beneficial Owners

        The General Partner owns all of the outstanding general partnership
        interests of NTCP; no person is known to own beneficially in excess of 5
        percent of the outstanding Limited Partnership Interests.

(b)     None of the officers or directors of the General Partner own directly or
        beneficially any Limited Partnership Interests in NTCP.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS:

The Partnership has no officers, directors, or employees of its own. All of its
affairs are managed by the General Partner, National Partnership Investments
Corp. , and the Special Limited Partner, PaineWebber T.C., Inc. The transactions
with the Special Limited Partner are primarily in the form of fees paid by the
Partnership to the General Partner for services rendered to the Partnership, as
discussed in Item 11 and in the notes to the accompanying financial statements.




<PAGE>   58

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K:

REPORTS OF INDEPENDENT PUBLIC ACCOUNTANTS.

FINANCIAL STATEMENTS

Report of Independent Public Accountants.

Balance Sheets as of December 31, 1998 and 1997.

Statements of Operations for the years ended December 31, 1998, 1997 and 1996.

Statements of Partners' Equity (Deficiency) for the years ended December 31,
1998, 1997 and 1996.

Statements of Cash Flows for the years ended December 31, 1998, 1997 and 1996.

Notes to Financial Statements.

FINANCIAL STATEMENT SCHEDULES APPLICABLE TO NATIONAL TAX CREDIT PARTNERS, L.P.
AND THE LIMITED PARTNERSHIPS IN WHICH NATIONAL TAX CREDIT PARTNERS, L.P. HAS
INVESTMENTS

Schedule - Investments in Local Limited Partnerships, December 31, 1998, 1997
and 1996.

Schedule III - Real Estate and Accumulated Depreciation, December 31, 1998.

The remaining schedules are omitted because any required information is included
in the financial statements and notes thereto, or they are not applicable, or
not required.

EXHIBITS

(3)     Articles of incorporation and bylaws: The registrant is not
        incorporated. The Partnership Agreement was filed with Form S-11
        Registration #33-27658 incorporated herein by reference.

(10)    Material contracts: The registrant is not party to any material
        contracts, other than the Restated Certificate and Agreement of Limited
        Partnership dated March 7, 1989 previously filed and which is hereby
        incorporated by reference.

REPORTS ON FORM 8-K

No reports on Form 8-K were filed during the year ended December 31, 1998.




<PAGE>   59

                                   SIGNATURES


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 in the City of Los Angeles,
State of California.


NATIONAL TAX CREDIT PARTNERS, L.P.

By:     NATIONAL PARTNERSHIP INVESTMENTS CORP.
        General Partner


/s/ CHARLES H. BOXENBAUM
-----------------------------------------
Charles H. Boxenbaum
Chairman of the Board of Directors
and Chief Executive Officer


/s/ BRUCE E. NELSON
-----------------------------------------
Bruce E. Nelson
Director and President


/s/ ALAN I. CASDEN
-----------------------------------------
Alan I. Casden
Director


/s/ HENRY C. CASDEN
-----------------------------------------
Henry C. Casden
Director


/s/ PAUL PATIERNO
-----------------------------------------
Paul Patierno
Chief Financial Officer