**FORM      10-K**

| x | ANNUAL                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT                OF 1934 |
|---|-------------------------------------------------------------------------------------------------------------------------|

**March      30, 2007**

| o | TRANSITION                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934 |
|---|---------------------------------------------------------------------------------------------------------------------------------------|

**0-19217**

**American      Tax Credit Properties III L.P.**

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

| **Richman                Tax Credit Properties III L.P.****340                Pemberwick Road****Greenwich,                Connecticut** |   |   **06831**             |
|------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|
| (Address                of principal executive offices)                                                                                  |   | (Zip                Code)         |
|                                                                                                                                     |   |                              |
| Registrant's                telephone number, including area code:                                                                       |   | **(203)                869-0900** |
|                                                                                                                                     |   |                              |
| Securities                registered pursuant to Section 12(b) of the Act:                                                               |   |                              |

| **None**                                                                   |   | **None**                                                   |
|----------------------------------------------------------------------------|--------|------------------------------------------------------------|
| (Title                of each Class)                                       |   | (Name                of each exchange on which registered) |
|                                                                       |   |                                                       |
| Securities                registered pursuant to Section 12(g) of the Act: |   |                                                       |

| **Units                of Limited Partnership Interest** |
|----------------------------------------------------------|
| (Title                of Class)                          |

----

**PART      I**

**Item          1. **
**Business**

----

**Item          1. **
**Business          (continued)**

**Item      1A. **
**Risk      Factors**

***Properties      owned by the Local Partnerships are subject to certain risks relating to the      real estate industry in general that are outside of the control of the Local      Partnerships or Registrant and that may have an adverse affect on Registrant’s      investment in such Local Partnerships.***

----

**Item      1A.  **
**Risk      Factors (continued)**

***The        modification or elimination of government rental subsidies on which the Local        Partnerships rely would require the Local Partnerships to use existing funds        or        obtain additional funds to continue to operate the respective Properties.        Because Registrant’s investments in the Local Partnerships are highly leveraged,        it would be highly difficult to obtain such additional        funds.***

***There      is no guarantee that it will be possible to sell the Properties or, if possible,      that Registrant would receive any proceeds from any such      sale.***

***Failure      to remain in compliance with various requirements may result in such Local      Partnership losing its eligibility for Low-income Tax Credits, which would      result in additional tax liability to holders of the Units of Limited      Partnership Interest of the Registrant.***

*by      unit holders at the time of the recapture event*

***The      Local Partnerships may be required to continue to maintain the low-income nature      of the Properties beyond the Compliance Period under agreements with state      tax      credit agencies.***

----

**Item      1A.  **
**Risk      Factors (continued)**

***Limited        partners may not be able to use all of the anticipated or carried forward        Low-income Tax Credits.***

***There      is no existing market for the Units.***

***Under      certain circumstances, limited partners of Registrant may incur out-of-pocket      tax costs.***

***Limited      partners of Registrant may not receive a return of any portion of their original      capital investment in Registrant.***

| **Item              1B.** | **Unresolved                Staff Comments** |
|---------------------------|----------------------------------------------|

----

| **Item                2.** | **Properties** |
|----------------------------|----------------|

|                                                                                              |   | Registrant |   | ATCP                II |   |
|---------------------------------------------------------------------------------------------------|--------|------------|--------|------------------------|--------|
| Batesville                Family, L.P.                                                            |   |       | 61.75  | %                      |   | 37.25 | % |
| Bruce                Housing Associates, L.P.                                                     |   |       | 61.75  |                   |   | 37.25 |   |
| Carrington                Limited Dividend Housing Association                Limited Partnership |   |       | 65.95  |                   |   | 33.05 |   |
| Ivy                Family, L.P.                                                                   |   |       | 61.75  |                   |   | 37.25 |   |
| Lawrence                Road Properties, Ltd.                                                     |   |       | 61.75  |                   |   | 37.25 |   |
| Mirador                del Toa Limited Partnership                                                |   |       | 59.06  |                   |   | 39.94 |   |
| Purvis                Heights Properties, L.P.                                                    |   |       | 61.75  |                   |   | 37.25 |   |
| Queen                Lane Investors                                                               |   |       | 48.50  |                   |   | 50.50 |   |

----

| **Item              2.** | **Properties                (continued)** |
|--------------------------|-------------------------------------------|

| Name                  of Local Partnership Name                  of apartment complex Apartment                  complex location                                                                                       |   | Number                  of                  rental units |   | Capital                  contribution |   | Mortgage loans                  payable as of December                  31, 2006 |   | Subsidy                  (see                  footnotes) |      |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------|--------|---------------------------------------|--------|--------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------|-----------|
| April                  Gardens Apartments II Limited                  Partnership April                  Gardens Apartments Las                  Piedras, Puerto Rico                                              |   |                                                     | 48     |                                  | $      | 485,581                                                                                    |   | $                                                         | 1,950,267 |   |   | (1b&d | ) |
| Ashland                  Park Apartments, L.P. Ashland                  Park Apartments Ashland,                  Nebraska                                                                                    |   |                                                     | 24     |                                  |   | 235,732                                                                                    |   |                                                      | 1,012,345 |   |   | (1b&d | ) |
| Auburn                  Family, L.P.Auburn                  Apartments Louisville, Mississippi                                                                                                                     |   |                                                     | 16     |                                  |   | 95,412                                                                                     |   |                                                      | 448,594   |   |   | (1b&d | ) |
| Batesville                  Family, L.P. Westridge                  Apartments Batesville,                  Mississippi                                                                                       |   |                                                     | 48     |                                  |   | 239,716                                                                                    | (2)    |                                                      | 1,408,946 |   |   | (1b | ) |
| Bay                  Springs Elderly, L.P. Bay                  Springs Manor Bay                  Springs, Mississippi                                                                                       |   |                                                     | 24     |                                  |   | 208,820                                                                                    |   |                                                      | 660,822   |   |   | (1b&d | ) |
| Brisas                  del Mar Apartments Limited                  Partnership Brisas                  del Mar Apartments Hatillo,                  Puerto Rico                                              |   |                                                     | 66     |                                  |   | 668,172                                                                                    |   |                                                      | 2,585,595 |   |   | (1b&d | ) |
| Bruce                  Housing Associates, L.P. Bruce                  Family Apartments Bruce,                  Mississippi                                                                                  |   |                                                     | 40     |                                  |   | 183,155                                                                                    | (2)    |                                                      | 1,077,661 |   |   | (1b&d | ) |
| Carrington                  Limited Dividend Housing                  Association Limited Partnership                  (4) Carrington                  Place Farmington                  Hills, Michigan |   |                                                     | 100    |                                  |   | 2,174,720                                                                                  | (2)    |                                                      | 3,123,538 |   |   | (1c | ) |
| Chestnut                  Park Associates, L.P. Chestnut                  Park Apartments East                  Orange, New                  Jersey                                                           |   |                                                     | 59     |                                  |   | 4,204,576                                                                                  |   |                                                      | 4,574,324 |   |   | (1a | ) |
| Chowan                  Senior Manor Associates Limited                  Partnership Azalea                  Garden Senior  Manor Apartments Murfreesboro,                  North Carolina     |   |                                                     | 33     |                                  |   | 278,405                                                                                    |   |                                                      | 1,212,836 |   |   | (1b&d | ) |
| Christian                  Street Commons Associates Christian                  Street Commons Apartments                  Philadelphia,                  Pennsylvania                                   |   |                                                     | 18     |                                  |   | 581,645                                                                                    |   |                                                      | 547,872   |   |   | (1b | ) |

----

| **Item              2.** | **Properties                (continued)** |
|--------------------------|-------------------------------------------|

| Name                  of Local Partnership Name                  of apartment complex Apartment                  complex location                                          |   | Number of                  rental units |   | Capital                  contribution |   | Mortgageoans                  payable as of December 31, 2006 |   | Subsidy                  (see                  footnotes) |      |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------|--------|---------------------------------------|--------|---------------------------------------------------------------|--------|-----------------------------------------------------------|-----------|
| Country                  View Apartments Country                  View Apartments Pembroke,                  Maine                                                    |   |                                              | 16     |                                  | $      | 279,183                                                       |   | $                                                         | 914,962   |   |   | (1b&d | ) |
| Desarrollos                  de Belen Limited Partnership Vista                  de Jagueyes II Apartments  Aguas                  Buenas, Puerto Rico      |   |                                              | 41     |                                  |   | 422,929                                                       |   |                                                      | 1,835,769 |   |   | (1b&d | ) |
| Desarrollos                  de Emaus Limited Partnership Hucares                  II Apartments Naguabo,                  Puerto Rico                      |   |                                              | 72     |                                  |   | 631,404                                                       |   |                                                      | 3,119,964 |   |   | (1b&d | ) |
| Ellinwood                  Heights Apartments, L.P. Ellinwood                  Heights Apartments Ellinwood,                  Kansas                             |   |                                              | 24     |                                  |   | 156,261                                                       |   |                                                      | 671,724   |   |   | (1b&d | ) |
| Fulton                  Street Houses Limited Partnership Fulton                  Street Townhouse Apartments New                  York, New York           |   |                                              | 35     |                                  |   | 1,948,081                                                     |   |                                                      | 3,869,930 |   |   | (1b | ) |
| Hayes                  Run Limited Partnership Mashburn                  Gap Apartments Marshall,                  North Carolina                                |   |                                              | 34     |                                  |   | 322,074                                                       |   |                                                      | 1,392,485 |   |   | (1b&d | ) |
| Howard                  L. Miller Sallisaw Apartments                  II, L.P. Sallisaw                  II Apartments Sallisaw,                  Oklahoma |   |                                              | 24     |                                  |   | 130,158                                                       |   |                                                      | 602,039   |   |   | (1b&d | ) |
| Hurlock                  Meadow Limited Partnership Hurlock                  Meadow Apartments Hurlock,                  Maryland                           |   |                                              | 30     |                                  |   | 284,218                                                       |   |                                                      | 1,238,575 |   |   | (1b&d | ) |
| Ivy                  Family, L.P. Ivy                  Apartments Louisville,                  Mississippi                                                       |   |                                              | 32     |                                  |   | 135,528                                                       | (2)    |                                                      | 750,706   |   |   | (1b&d | ) |
| Justin                  Associates Locust                  Tower Apartments Philadelphia,                  Pennsylvania                                          |   |                                              | 40     |                                  |   | 1,809,723                                                     |   |                                                      | 2,114,932 |   |   | (1b&e | ) |
| LaBelle                  Commons, Ltd. LaBelle                  Commons LaBelle,                  Florida                                                        |   |                                              | 32     |                                  |   | 253,580                                                       |   |                                                      | 988,498   |   |   | (1b&d | ) |
| Lawrence                  Road Properties, Ltd.Hillcrest                  Apartments Newton,                  Mississippi                                             |   |                                              | 24     |                                  |   | 123,799                                                       | (2)    |                                                      | 741,086   |   |   | (1b&d | ) |

----

| **Item              2.** | **Properties                (continued)** |
|--------------------------|-------------------------------------------|

| Name                    of Local PartnershipName                    of apartment complexApartment                    complex location                                    |   | Number                      of                      rental units |   | Capital                  contribution |   | Mortgage loans                      payable as of December 31, 2006 |   | Subsidy                      (see                      footnotes) |      |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------|--------|---------------------------------------|--------|--------------------------------------------------------------------------|--------|-------------------------------------------------------------------|-----------|
| Loma                Del Norte Limited Partnership                Loma                Del Norte Apartments Anthony,                New Mexico                             |   |                                                             | 40     |                                  | $      | 314,865                                                                  |   | $                                                                 | 1,405,307 |   |   | (1b&d | ) |
| Long                Reach Associates Limited Partnership                Oak                Ridge Apartments Bath,                 Maine                             |   |                                                             | 30     |                                  |   | 448,922                                                                  |   |                                                              | 1,445,189 |   |   | (1b&d | ) |
| Mirador                del Toa Limited Partnership Mirador                del Toa Apartments Toa                Alta, Puerto Rico                                   |   |                                                             | 48     |                                  |   | 284,847                (2                                                | )      |                                                              | 1,832,459 |   |   | (1b&d | ) |
| Moore                Haven Commons, Ltd. Moore                Haven Commons Moore                Haven, Florida                                                          |   |                                                             | 28     |                                  |   | 213,402                                                                  |   |                                                              | 906,141   |   |   | (1b&d | ) |
| NP-89                Limited Dividend Housing Association                Limited Partnership Newport                Apartments Clinton                Township, Michigan |   |                                                             | 168    |                                  |   | 2,372,292                                                                |   |                                                              | 3,282,877 |   |   | (1a,b&h | ) |
| Nash                Hill Associates, Limited Partnership                Nash                Hill Place Williamsburg,                Massachusetts                        |   |                                                             | 28     |                                  |   | 302,575                                                                  |   |                                                              | 1,434,317 |   |   | (1b,d&f | ) |
| North                Calhoun City, L.P. North                Calhoun City Apartments Calhoun                City, Mississippi                                            |   |                                                             | 18     |                                  |   | 146,565                                                                  |   |                                                              | 460,664   |   |   | (1b&d | ) |
| Orange                City Plaza, Limited Partnership                (3) Orange                City Plaza Apartments Orange                City, Iowa                    |   |                                                             | 32     |                                  |   | 561,401                                                                  |   |                                                              | 393,027   |   |   | (1g | ) |
| Puerta                del Mar Limited Partnership Puerta                del Mar Apartments Hatillo,                Puerto Rico                                           |   |                                                             | 66     |                                  |   | 630,570                                                                  |   |                                                              | 2,460,339 |   |   | (1b&d | ) |
| Purvis                Heights Properties, L.P. Pineview                Apartments Purvis,                Mississippi                                                     |   |                                                             | 40     |                                  |   | 191,512                (2                                                | )      |                                                              | 1,121,965 |   |   | (1b | ) |
| Queen                Lane Investors Queen's                Row Philadelphia,                Pennsylvania                                                                 |   |                                                             | 29     |                                  |   | 597,050                (2                                                | )      |                                                              | 1,647,041 |   |   | (1b&e | ) |
| Somerset                Manor, Ltd. Somerset                Manor Central                City, Pennsylvania                                                              |   |                                                             | 24     |                                  |   | 208,465                                                                  |   |                                                              | 877,468   |   |   | (1b&d | ) |
| Sugar                Cane Villas, Ltd. Sugar                Cane Villas Pahokee,                Florida                                                                  |   |                                                             | 87     |                                  |   | 751,560                                                                  |   |                                                              | 3,232,530 |   |   | (1b&d | ) |

----

| **Item              2.** | **Properties                (continued)** |
|--------------------------|-------------------------------------------|

| Name                    of Local Partnership Name                    of apartment complex Apartment                    complex location                                 |   | Number                of                rental units |   | Capital                    contribution |   | Mortgage                    loans                    payable as of December                    31, 2006 |   | Subsidy                    (see                    footnotes) |       |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------|--------|-----------------------------------------|--------|---------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------|------------|
| Summerfield                Apartments Limited Partnership                Summerfield                Apartments Charlotte,                North Carolina                 |   |                                                      | 52     |                                    | $      | 1,088,667                                                                                               |   | $                                                             | 1,532,337  |   |   | (1b | ) |
| Sydney                Engel Associates L.P. (formerly                known as Sydney Engel Associates) The                Castle New                York, New York |   |                                                      | 224    |                                    |   | 3,201,874                                                                                               |   |                                                          | 15,649,510 |   |   | (1b | ) |
| Union                Valley Associates Limited Partnership                Union                Valley Apartments Union                Township, Pennsylvania            |   |                                                      | 36     |                                    |   | 371,589                                                                                                 |   |                                                          | 1,414,312  |   |   | (1b | ) |
| Walnut                Grove Family, L.P. Walnut                GroveApartments Walnut Grove, Mississippi                                                      |   |                                                      | 24     |                                    |   | 191,695                                                                                                 |   |                                                          | 829,424    |   |   | (1b&d | ) |
| Waynesboro                Apartments Limited Partnership                Waynesboro                Apartments Waynesboro,                Pennsylvania                    |   |                                                      | 36     |                                    |   | 360,859                                                                                                 |   |                                                          | 1,447,007  |   |   | (1b | ) |
| West                Calhoun City, L.P. West                Calhoun City Apartments Calhoun                City,  Mississippi                                       |   |                                                      | 28     |                                    |   | 230,212                                                                                                 |   |                                                          | 701,450    |   |   | (1b&d | ) |
| Westminster                Apartments Limited Partnership                Westminster                Apartments Philadelphia,                Pennsylvania                |   |                                                      | 42     |                                    |   | 1,047,993                                                                                               |   |                                                          | 1,607,972  |   |   | (1b&e | ) |
|                                                                                                                                                                    |   |                                                      |   |                                    | $      | 29,369,787                                                                                              |   | $                                                             | 80,524,806 |   |   |   |   |

|   | (1) | Description                of subsidies: |
|--------|-----|------------------------------------------|

|  | (a) | Section                8 of Title II of the Housing and Community Development Act of 1974                allows                qualified low-income tenants to pay thirty percent of their monthly                income                as rent with the balance paid by the federal                government. |
|--|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|
|   | (b) | The Local Partnership’s debt structure              includes a principal or interest payment subsidy. |
|--------|-----|-------------------------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|
|   | (c) | The Michigan State Housing Development              Authority allows tenants, who would otherwise pay more than 40% of              their              income for rent and utilities, to receive rental              subsidies. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|
|   | (d) | The Rural Housing Service (formerly              the              Farmers Home Administration) of the United States Department of              Agriculture Rental Assistance Program allows qualified low-  income              tenants to receive rental subsidies. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|
|   | (e) | The City of Philadelphia Housing Authority              allows qualified low-income tenants to receive rental certificates. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|
|   | (f) | The Commonwealth of Massachusetts participates              in a rental assistance program. |
|--------|-----|---------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|
|   | (g) | The Northwest Regional Housing Authority              provides qualified tenants with a rental              subsidy. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|
|   | (h) | The Local Partnership’s Section 8 contracts              are currently subject to renewal under applicable HUD              guidelines. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------|

----

| **Item              2.** | **Properties                (continued)** |
|--------------------------|-------------------------------------------|

|   | (2) | Reflects                amount attributable to Registrant                only. |
|--------|-----|--------------------------------------------------------------------------------|

|   | (3) | Capital                contribution includes advances to Local                Partnership. |
|--------|-----|--------------------------------------------------------------------------------------------|

|   | (4) | Registrant                assigned its limited partner interest to one of the Local General                Partners                during the year ended March 30, 2007 (see Part II, Item 7 - Management’s                Discussion and Analysis of Financial Condition and Results of Operations,                herein). |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **Item                3.** | **Legal                Proceedings** |
|----------------------------|--------------------------------------|

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

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**PART      II**

| **Item                5.** | **Market                for Registrant's Common Equity, Related Stockholder Matters and Issuer                Purchases of Equity                Securities** |
|----------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| **Item              6.** | **Selected                Financial Data** |
|--------------------------|--------------------------------------------|

|                                             |   |   | Years                  Ended March 30,  |   |
|--------------------------------------------------|--------|--------|----------------------------------------------|--------|
|                                             |   |   | 2007                                    |   |   | 2006  |   |   | 2005  |   |   | 2004  |   |   | 2003  |   |
| Interest                  and other revenue      |   | $      | 95,084                                       |   | $ | 142,837 |   | $ | 176,110 |   | $ | 193,706 |   | $ | 224,254 |   |
| Equity                  in loss of investment in |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| local                  partnerships              |   | $      | (97,326                                      | )      | $ | (162,367 | ) | $ | (247,207 | ) | $ | (215,731 | ) | $ | (536,158 | ) |
| Gain                  on disposal of limited     |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| partner                  interests/local         |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| partnership                  properties          |   | $      | 149,895                                      |   | $ | — |   | $ | — |   | $ | — |   | $ | — |   |
| Net                  loss                        |   | $      | (431,945                                     | )      | $ | (620,078 | ) | $ | (640,259 | ) | $ | (611,662 | ) | $ | (875,199 | ) |
| Net                  loss per unit of limited    |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| partnership                  interest            |   | $      | —                                      |   | $ | (11.44 | ) | $ | (17.66 | ) | $ | (16.88 | ) | $ | (24.15 | ) |

|                          |        |   | As                  of March 30,  |   |
|-------------------------------|--------|--------|----------------------------------------|--------|
|                          |   |   | 2007                              |   |   | 2006  |   |   | 2005  |   |   | 2004  |   |   | 2003  |   |
| Total                  assets |   | $      | 1,967,060                              |   | $ | 2,109,756 |   | $ | 2,747,749 |   | $ | 3,766,895 |   | $ | 4,153,964 |   |

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

----

| **Item              7.** | **Management's                Discussion and Analysis of Financial Condition and Results of Operations                (continued)** |
|--------------------------|-------------------------------------------------------------------------------------------------------------------------------------|

----

| **Item              7.** | **Management's                Discussion and Analysis of Financial Condition and Results of Operations                (continued)** |
|--------------------------|-------------------------------------------------------------------------------------------------------------------------------------|

----

| **Item              7.** | **Management's                Discussion and Analysis of Financial Condition and Results of Operations                (continued)** |
|--------------------------|-------------------------------------------------------------------------------------------------------------------------------------|

|                                          |   | Total  |      | <                  1 year |   | 1                  -                  3 years |   | 3                  -                  5 years |      | >                  5 years |   |
|-----------------------------------------------|--------|--------|-----------|------------------------------|--------|-----------------------------------------------|--------|-----------------------------------------------|-----------|-------------------------------|--------|
| Other                  Long Term Liabilities: |   |   |      |                         |   |                                          |   |                                          |      |                          |   |
| Accounts                  Payable and         |   |   |      |                         |   |                                          |   |                                          |      |                          |   |
| Accrued                  Expenses (1)         |   | $      | 440,673   |                         | $      | —                                       |   | $                                             | 440,673   |                          | $      | — |   | $ | — |   |
|                                          |   |   |      |                         |   |                                          |   |                                          |      |                          |   |   |   |   |   |   |
| Payable                  to General Partner   |   |   |      |                         |   |                                          |   |                                          |      |                          |   |   |   |   |   |   |
| and                  Affiliates (2)           |   |   | 2,393,732 |                         |   | —                                       |   |                                          | 2,393,732 |                          |   | — |   |   | — |   |
|                                          |   | $      | 2,834,405 |                         | $      | —                                       |   | $                                             | 2,834,405 |                          | $      | — |   | $ | — |   |

| (1) | Represents                Administration Fees payable to a third-party former service provider;                such                amount is payable from available reserves or sale or refinancing                proceeds                from the Local Partnerships to the extent such amounts are                available. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Represents                Administration and Management Fees payable to an affiliate of the                General                Partner; such amount is payable from available reserves or sale or                refinancing proceeds from the Local Partnerships to the extent such                amounts are available. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| **Item              7.** | **Management's                Discussion and Analysis of Financial Condition and Results of Operations                (continued)** |
|--------------------------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Registrant                accounts for its investment in local partnerships in accordance with                the                equity method of accounting since Registrant does not control the                operations of a Local Partnership. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | If                the book value of Registrant’s investment in a Local Partnership exceeds                the estimated value derived by management, Registrant reduces its                investment in any such Local Partnership and includes such reduction                in                equity in loss of investment in local partnerships. Registrant makes                such                assessment at least annually in the fourth quarter of its fiscal                year or                whenever there are indications that a permanent impairment may have                occurred.** **A                loss in value of an investment in a Local Partnership other than                a                temporary decline would be recorded as an impairment loss. Impairment                is                measured by comparing the investment carrying amount to the sum of                the                total amount of the remaining tax credits to be allocated to Registrant                and the estimated residual value of the                investment. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Registrant                does not consolidate the accounts and activities of the Local                Partnerships, which are considered Variable Interest Entities under                Financial Accounting Standards Board Interpretation No. 46 - Revised,                “Consolidation of Variable Interest Entities,” because Registrant is not                considered the primary beneficiary. Registrant’s balance in investment in                local partnerships, plus the risk of recapture of tax credits previously                recognized on such investments, represents the maximum exposure to                loss in                connection with such investments. Registrant's exposure to loss on                the                Local Partnerships is mitigated by the condition and financial performance                of the underlying Properties as well as the strength of the Local                General                Partners and their guarantees against credit                recapture. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| **Item              7a.** | **Quantitative                and Qualitative Disclosure About Market                Risk** |
|---------------------------|---------------------------------------------------------------------------------------------|

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

| **Item                8.** | **Financial                Statements and Supplementary Data** |
|----------------------------|----------------------------------------------------------------|

| **Table                  of Contents** |
|----------------------------------------|

|                                                                     |   | **Page** |   |
|--------------------------------------------------------------------------|--------|----------|--------|
| Report                  of Independent Registered Public Accounting Firm |   |     | 20     |   |
|                                                                     |   |     |   |   |
| Balance                  Sheets                                          |   |     | 21     |   |
|                                                                     |   |     |   |   |
| Statements                  of Operations                                |   |     | 22     |   |
|                                                                     |   |     |   |   |
| Statements                  of Changes in Partners' Equity (Deficit)     |   |     | 23     |   |
|                                                                     |   |     |   |   |
| Statements                  of Cash Flows                                |   |     | 24     |   |
|                                                                     |   |     |   |   |
| Notes                  to Financial Statements                           |   |     | 26     |   |

----

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**BALANCE      SHEETS**

**MARCH      30, 2007 AND 2006**

|                                                                                                      |   | **Notes** |   | **2007** |   | **2006**  |   |
|-----------------------------------------------------------------------------------------------------------|--------|-----------|--------|----------|--------|-----------|--------|
| **ASSETS**                                                                                                |   |      |   |     |   |      |   |
|                                                                                                      |   |      |   |     |   |      |   |
| Cash                and cash equivalents                                                                  |   |      | 3,9    |     | $      | 164,013   |   | $ | 151,370 |   |
| Investments                in bonds                                                                       |   |      | 4,9    |     |   | 1,226,235 |   |   | 1,377,915 |   |
| Investment                in local partnerships                                                           |   |      | 5,8    |     |   | 576,812   |   |   | 578,827 |   |
| Interest                receivable                                                                        |   |      | 9      |     |   |      |   |   | 1,644 |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
|                                                                                                      |   |      |   |     | $      | 1,967,060 |   | $ | 2,109,756 |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
| **LIABILITIES                AND PARTNERS' EQUITY (DEFICIT)**                                             |   |      |   |     |   |      |   |   |   |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
| Liabilities                                                                                               |   |      |   |     |   |      |   |   |   |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
| Accounts                payable and accrued expenses                                                      |   |      | 8      |     | $      | 530,807   |   | $ | 518,027 |   |
| Payable                to general partner and affiliates                                                  |   |      | 6,8    |     |   | 2,393,732 |   |   | 2,111,993 |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
|                                                                                                      |   |      |   |     |   | 2,924,539 |   |   | 2,630,020 |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
| Commitments                and contingencies                                                              |   |      | 8      |     |   |      |   |   |   |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
| Partners'                equity (deficit)                                                                 |   |      | 2,4    |     |   |      |   |   |   |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
| General                partner                                                                            |   |      |   |     |   | (955,801  | )      |   | (523,856 | ) |
| Limited                partners (35,883 units of limited partnership interest                outstanding) |   |      |   |     |   |      |   |   |   |   |
| Accumulated                other comprehensive income (loss), net                                         |   |      |   |     |   | (1,678    | )      |   | 3,592 |   |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
|                                                                                                      |   |      |   |     |   | (957,479  | )      |   | (520,264 | ) |
|                                                                                                      |   |      |   |     |   |      |   |   |   |   |
|                                                                                                      |   |      |   |     | $      | 1,967,060 |   | $ | 2,109,756 |   |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**STATEMENTS      OF OPERATIONS**

**YEARS      ENDED MARCH 30, 2007, 2006 AND 2005**

|                                                                                                                   |   | **Notes** |   | **2007** |   | **2006** |   | **2005** |     |
|------------------------------------------------------------------------------------------------------------------------|--------|-----------|--------|----------|--------|----------|--------|----------|----------|
|                                                                                                                   |   |      |   |     |   |     |   |     |     |
| **REVENUE**                                                                                                            |   |      |   |     |   |     |   |     |     |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |
| Interest                                                                                                               |   |      |   |     | $      | 72,044   |   | $        | 97,334   |   | $ | 141,566 |   |
| Other                income from local partnerships                                                                    |   |      |   |     |   | 23,040   |   |     | 45,503   |   |   | 34,544 |   |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| TOTAL                REVENUE                                                                                           |   |      |   |     |   | 95,084   |   |     | 142,837  |   |   | 176,110 |   |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| **EXPENSES**                                                                                                           |   |      |   |     |   |     |   |     |     |   |   |   |   |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| Administration                fees - affiliate                                                                         |   |      | 6,8    |     |   | 228,313  |   |     | 230,571  |   |   | 230,571 |   |
| Management                fees - affiliate                                                                             |   |      | 6,8    |     |   | 228,313  |   |     | 230,571  |   |   | 230,571 |   |
| Professional                fees                                                                                       |   |      |   |     |   | 68,965   |   |     | 78,597   |   |   | 68,253 |   |
| State                of New Jersey filing fees                                                                         |   |      |   |     |   | 25,667   |   |     | 34,337   |   |   | 20,145 |   |
| Printing,                postage and other                                                                             |   |      |   |     |   | 28,340   |   |     | 26,472   |   |   | 19,622 |   |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| TOTAL                EXPENSES                                                                                          |   |      |   |     |   | 579,598  |   |     | 600,548  |   |   | 569,162 |   |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
|                                                                                                                   |   |      |   |     |   | (484,514 | )      |     | (457,711 | ) |   | (393,052 | ) |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| Equity                in loss of investment in local partnerships                                                      |   |      | 5      |     |   | (97,326  | )      |     | (162,367 | ) |   | (247,207 | ) |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| Loss                prior to gain on disposal of limited partner interests/local partnership                properties |   |      |   |     |   | (581,840 | )      |     | (620,078 | ) |   | (640,259 | ) |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| Gain                on disposal of limited partner interests/local partnership                properties               |   |      |   |     |   | 149,895  |   |     |     |   |   |   |   |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| **NET                LOSS**                                                                                            |   |      |   |     |   | (431,945 | )      |     | (620,078 | ) |   | (640,259 | ) |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| Other                comprehensive loss, net                                                                           |   |      | 4      |     |   | (5,270   | )      |     | (51,901  | ) |   | (167,653 | ) |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| **COMPREHENSIVE                LOSS**                                                                                  |   |      |   |     | $      | (437,215 | )      | $        | (671,979 | ) | $ | (807,912 | ) |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| **NET                LOSS ATTRIBUTABLE TO**                                                                            |   |      | 2      |     |   |     |   |     |     |   |   |   |   |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
| General                partner                                                                                         |   |      |   |     | $      | (431,945 | )      | $        | (209,521 | ) | $ | (6,403 | ) |
| Limited                partners                                                                                        |   |      |   |     |   |     |   |     | (410,557 | ) |   | (633,856 | ) |
|                                                                                                                   |   |      |   |     |   |     |   |     |     |   |   |   |   |
|                                                                                                                   |   |      |   |     | $      | (431,945 | )      | $        | (620,078 | ) | $ | (640,259 | ) |
| **NET                LOSS**per                unit of limited partnership                                              |   |      |   |     |   |     |   |     |     |   |   |   |   |
| interest                (35,883 units of limited partnership interest)                                                 |   |      |   |     | $      | —  |   | $        | (11.44   | ) | $ | (17.66 | ) |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**STATEMENTS      OF CHANGES IN PARTNERS' EQUITY (DEFICIT)**

**YEARS      ENDED MARCH 30, 2007, 2006 AND 2005**

|                                                      |   | **General****Partner** |     | **Limited****Partners** |   | **Accumulated                  Other Comprehensive****Income                  (Loss), Net** |   | **Total** |     |
|-----------------------------------------------------------|--------|------------------------|----------|-------------------------|--------|---------------------------------------------------------------------------------------------|--------|-----------|----------|
| Partners'                equity (deficit), March 30, 2004 |   | $                      | (307,932 | )                       | $      | 1,044,413                                                                                   |   | $         | 223,146  |   | $ | 959,627 |   |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Net                loss                                   |   |                   | (6,403   | )                       |   | (633,856                                                                                    | )      |      |     |   |   | (640,259 | ) |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Other                comprehensive loss, net              |   |                   |     |                    |   |                                                                                        |   |      | (167,653 | ) |   | (167,653 | ) |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Partners'                equity (deficit), March 30, 2005 |   |                   | (314,335 | )                       |   | 410,557                                                                                     |   |      | 55,493   |   |   | 151,715 |   |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Net                loss                                   |   |                   | (209,521 | )                       |   | (410,557                                                                                    | )      |      |     |   |   | (620,078 | ) |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Other                comprehensive loss, net              |   |                   |     |                    |   |                                                                                        |   |      | (51,901  | ) | (51,901) |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Partners'                equity (deficit), March 30, 2006 |   |                   | (523,856 | )                       |   | —                                                                                     |   |      | 3,592    |   | (520,264) |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Net                loss                                   |   |                   | (431,945 | )                       |   |                                                                                        |   |      |     |   |   | (431,945 | ) |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Other                comprehensive loss, net              |   |                   |     |                    |   |                                                                                        |   |      | (5,270   | ) |   | (5,270 | ) |
|                                                      |   |                   |     |                    |   |                                                                                        |   |      |     |   |   |   |   |
| Partners'                deficit, March 30, 2007          |   | $                      | (955,801 | )                       | $      | —                                                                                     |   | $         | (1,678   | ) | $ | (957,479 | ) |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**STATEMENTS      OF CASH FLOWS**

**YEARS      ENDED MARCH 30, 2007, 2006 AND 2005**

|                                                                                                                         |   | **2007** |     | **2006** |   | **2005** |   |
|------------------------------------------------------------------------------------------------------------------------------|--------|----------|----------|----------|--------|----------|--------|
| **CASH                FLOWS FROM OPERATING ACTIVITIES**                                                                      |   |     |     |     |   |     |   |
|                                                                                                                         |   |     |     |     |   |     |   |
| Interest                received                                                                                             |   | $        | 14,109   |     | $      | 18,179   |   | $ | 60,168 |   |
| Cash                paid for                                                                                                 |   |     |     |     |   |     |   |   |   |   |
| administration                fees                                                                                           |   |     | (15,553  | )        |   | (248,578 | )      |   | (301,769 | ) |
| management                fees                                                                                               |   |     | (159,334 | )        |   | (190,479 | )      |   | (361,781 | ) |
| professional                fees                                                                                             |   |     | (51,852  | )        |   | (75,873  | )      |   | (70,779 | ) |
| State                of New Jersey filing fees                                                                               |   |     | (30,000  | )        |   | (27,171  | )      |   | (24,445 | ) |
| printing,                postage and other expenses                                                                          |   |     | (28,340  | )        |   | (24,461  | )      |   | (21,622 | ) |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| Net                cash used in operating activities                                                                         |   |     | (270,970 | )        |   | (548,383 | )      |   | (720,228 | ) |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| **CASH                FLOWS FROM INVESTING ACTIVITIES**                                                                      |   |     |     |     |   |     |   |   |   |   |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| Proceeds                in connection with disposal of limited partner interests/local partnership                properties |   |     | 149,895  |     |   |     |   |   |   |   |
| Advances                to local partnerships                                                                                |   |     | (105,311 | )        |   |     |   |   |   |   |
| Cash                distributions from local partnerships                                                                    |   |     | 33,040   |     |   | 55,984   |   |   | 44,544 |   |
| Maturities/redemptions                and sales of bonds                                                                     |   |     | 205,989  |     |   | 585,768  |   |   | 630,443 |   |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| Net                cash provided by investing activities                                                                     |   |     | 283,613  |     |   | 641,752  |   |   | 674,987 |   |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| Net                increase (decrease) in cash and cash equivalents                                                          |   |     | 12,643   |     |   | 93,369   |   |   | (45,241 | ) |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| Cash                and cash equivalents at beginning of year                                                                |   |     | 151,370  |     |   | 58,001   |   |   | 103,242 |   |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| **CASH                AND CASH EQUIVALENTS AT END OF YEAR**                                                                  |   | $        | 164,013  |     | $      | 151,370  |   | $ | 58,001 |   |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| **SIGNIFICANT                NON-CASH INVESTING ACTIVITIES**                                                                 |   |     |     |     |   |     |   |   |   |   |
|                                                                                                                         |   |     |     |     |   |     |   |   |   |   |
| Unrealized                loss on investments in bonds, net                                                                  |   | $        | (5,270   | )        | $      | (51,901  | )      | $ | (167,653 | ) |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**STATEMENTS      OF CASH FLOWS - (Continued)**

**YEARS      ENDED MARCH 30, 2007, 2006 AND 2005**

|                                                                                                     |   | **2007** |     | **2006** |   | **2005** |   |
|----------------------------------------------------------------------------------------------------------|--------|----------|----------|----------|--------|----------|--------|
| **RECONCILIATION                OF NET LOSS TO NET CASH USED IN OPERATING                ACTIVITIES**    |   |     |     |     |   |     |   |
|                                                                                                     |   |     |     |     |   |     |   |
| Net                loss                                                                                  |   | $        | (431,945 | )        | $      | (620,078 | )      | $ | (640,259 | ) |
|                                                                                                     |   |     |     |     |   |     |   |   |   |   |
| Adjustments                to reconcile net loss to net cash used in operating                activities |   |     |     |     |   |     |   |   |   |   |
|                                                                                                     |   |     |     |     |   |     |   |   |   |   |
| Equity                in loss of investment in local partnerships                                        |   |     | 97,326   |     |   | 162,367  |   |   | 247,207 |   |
| Gain                on disposal of limited partner interests/local partnership                properties |   |     | (149,895 | )        |   |     |   |   |   |   |
| Distributions                from local partnerships classified as other income                          |   |     | (23,040  | )        |   | (45,503  | )      |   | (34,544 | ) |
| Gain                on redemptions and sales of bonds                                                    |   |     | (4,447   | )        |   |     |   |   | (17,753 | ) |
| Amortization                of net premium on investments in bonds                                       |   |     | 927      |     |   | 1,423    |   |   | 4,832 |   |
| Accretion                of zero coupon bonds                                                            |   |     | (56,059  | )        |   | (80,533  | )      |   | (86,491 | ) |
| Decrease                (increase) in interest receivable                                                |   |     | 1,644    |     |   | (45      | )      |   | 18,014 |   |
| Increase                in payable to general partner and affiliates                                     |   |     | 281,739  |     |   | 138,085  |   |   | 29,592 |   |
| Increase                (decrease) in accounts payable and accrued expenses                              |   |     | 12,780   |     |   | (104,099 | )      |   | (240,826 | ) |
|                                                                                                     |   |     |     |     |   |     |   |   |   |   |
| **NET                CASH USED IN OPERATING ACTIVITIES**                                                 |   | $        | (270,970 | )        | $      | (548,383 | )      | $ | (720,228 | ) |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS**

**MARCH      30, 2007, 2006 AND 2005**

**1.      **
**Organization,      Purpose and Summary of Significant Accounting Policies**

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**1.      **
**Organization,      Purpose and Summary of Significant Accounting Policies      (continued)**

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**2.      **
**Capital      Contributions**

**3.      **
**Cash      and Cash Equivalents**

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**4.      **
**Investments      in Bonds**

| Description                and maturity          |   | Amortizedcost |      | Gross                unrealized gains |   | Gross                unrealized                losses |   | Estimatedfairvalue |   |
|--------------------------------------------------|--------|---------------|-----------|---------------------------------------|--------|-------------------------------------------------------|--------|--------------------|--------|
| U.S.                Treasury debt securities     |   |          |      |                                  |   |                                                  |   |               |   |
| Within                one year                   |   | $             | 399,571   |                                  | $      | —                                               |   | $                  | (515   | ) | $ | 399,056 |   |
| After                one year through five years |   |          | 828,342   |                                  |   | —                                               |   |               | (1,163 | ) |   | 827,179 |   |
|                                             |   | $             | 1,227,913 |                                  | $      | —                                               |   | $                  | (1,678 | ) | $ | 1,226,235 |   |

|   Description                and maturity |   | Amortizedcost |      | Gross                unrealized gains |   | Gross                unrealized                losses |   | Estimatedfairvalue |    |
|-----------------------------------------------------|--------|---------------|-----------|---------------------------------------|--------|-------------------------------------------------------|--------|--------------------|---------|
| Corporate                debt securities            |   |          |      |                                  |   |                                                  |   |               |    |
| After                one year through five years    |   | $             | 202,419   |                                  | $      | 6,510                                                 |   | $                  | — |   | $ | 208,929 |   |
|                                                |   |          |      |                                  |   |                                                  |   |               |    |   |   |   |   |
| U.S.                Treasury debt securities        |   |          |      |                                  |   |                                                  |   |               |    |   |   |   |   |
| After                one year through five years    |   |          | 1,171,904 |                                  |   | —                                               |   |               | (2,918  | ) |   | 1,168,986 |   |
|                                                |   | $             | 1,374,323 |                                  | $      | 6,510                                                 |   | $                  | (2,918  | ) | $ | 1,377,915 |   |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.      **
**Investment      in Local Partnerships**

| 1.  |   | April                Gardens Apartments II Limited Partnership;                                          |
|-----|--------|----------------------------------------------------------------------------------------------------------|
| 2.  |   | Ashland                Park Apartments, L.P.;                                                            |
| 3.  |   | Auburn                Family, L.P.;                                                                      |
| 4.  |   | Batesville                Family, L.P.;                                                                  |
| 5.  |   | Bay                Springs Elderly, L.P.;                                                                |
| 6.  |   | Brisas                del Mar Apartments Limited Partnership;                                            |
| 7.  |   | Bruce                Housing Associates, L.P.;                                                           |
| 8.  |   | Chestnut                Park Associates, L.P.*;                                                          |
| 9.  |   | Chowan                Senior Manor Associates Limited Partnership;                                       |
| 10. |   | Christian                Street Commons Associates;                                                      |
| 11. |   | Country                View Apartments;                                                                  |
| 12. |   | Desarrollos                de Belen Limited Partnership;                                                 |
| 12. |   | Desarrollos                de Emaus Limited Partnership;                                                 |
| 14. |   | Ellinwood                Heights Apartments, L.P. (“Ellinwood Heights”);                     |
| 15. |   | Fulton                Street Houses Limited Partnership;                                                 |
| 16. |   | Hayes                Run Limited Partnership;                                                            |
| 17. |   | Howard                L. Miller Sallisaw Apartments II, L.P.;                                            |
| 18. |   | Hurlock                Meadow Limited Partnership;                                                       |
| 29. |   | Ivy                Family, L.P.;                                                                         |
| 20. |   | Justin                Associates;                                                                        |
| 21. |   | LaBelle                Commons, Ltd.;                                                                    |
| 22. |   | Lawrence                Road Properties, Ltd.;                                                           |
| 23. |   | Loma                Del Norte Limited Partnership;                                                       |
| 24. |   | Long                Reach Associates Limited Partnership;                                                |
| 25. |   | Mirador                del Toa Limited Partnership;                                                      |
| 26. |   | Moore                Haven Commons, Ltd.;                                                                |
| 27. |   | NP-89                Limited Dividend Housing Association Limited                Partnership;            |
| 28. |   | Nash                Hill Associates, Limited Partnership;                                                |
| 29. |   | North                Calhoun City, L.P.;                                                                 |
| 30. |   | Orange                City Plaza, Limited Partnership (“Orange                City”);        |
| 31. |   | Puerta                del Mar Limited Partnership;                                                       |
| 32. |   | Purvis                Heights Properties, L.P.;                                                          |
| 33. |   | Queen                Lane Investors (“Queen Lane”);                                          |
| 34. |   | Somerset                Manor, Ltd.;                                                                     |
| 35. |   | Sugar                Cane Villas, Ltd.;                                                                  |
| 36. |   | Summerfield                Apartments Limited Partnership;                                               |
| 37. |   | Sydney                Engel Associates L.P. (formerly known as Sydney Engel                Associates)*; |
| 38. |   | Union                Valley Associates Limited Partnership;                                              |
| 39. |   | Walnut                Grove Family, L.P.;                                                                |
| 40. |   | Waynesboro                Apartments Limited Partnership;                                                |
| 41. |   | West                Calhoun City, L.P.; and                                                              |
| 42. |   | Westminster                Apartments Limited Partnership                (“Westminster”).    |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.          **
**Investment          in Local Partnerships (continued)**

|                                                                                                                        |   | ThePartnership |   |  ATCP                II |   |
|-----------------------------------------------------------------------------------------------------------------------------|--------|----------------|--------|------------------------------|--------|
| Batesville                Family, L.P.                                                                                      |   |           | 61.75  | %                            |   | 37.25 | % |
| Bruce                Housing Associates, L.P.                                                                               |   |           | 61.75  |                         |   | 37.25 |   |
| Carrington                Limited Dividend HousingAssociation                Limited Partnership (“Carrington”) |   |           | 65.95  |                         |   | 33.05 |   |
| Ivy                Family, L.P.                                                                                             |   |           | 61.75  |                         |   | 37.25 |   |
| Lawrence                Road Properties, Ltd.                                                                               |   |           | 61.75  |                         |   | 37.25 |   |
| Mirador                del Toa Limited Partnership                                                                          |   |           | 59.06  |                         |   | 39.94 |   |
| Purvis                Heights Properties, L.P.                                                                              |   |           | 61.75  |                         |   | 37.25 |   |
| Queen                Lane Investors                                                                                         |   |           | 48.50  |                         |   | 50.50 |   |

----

**AMERICAN        TAX CREDIT PROPERTIES III L.P.**

**NOTES        TO FINANCIAL STATEMENTS - (Continued)**

**MARCH        30, 2007, 2006 AND 2005**

**5.            **
**Investment            in Local Partnerships (continued)**

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.**
**Investment      in Local Partnerships (continued) **

|                                                                                                                                     |   | **2006** |        | **2005** |   |
|------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|-------------|----------|--------|
| **ASSETS**                                                                                                                               |   |     |        |     |   |
|                                                                                                                                     |   |     |        |     |   |
| Cash                and cash equivalents                                                                                                 |   | $        | 1,575,290   |     | $      | 1,309,842 |   |
| Rents                receivable                                                                                                          |   |     | 464,095     |     |   | 557,433 |   |
| Escrow                deposits and reserves                                                                                              |   |     | 5,591,786   |     |   | 5,633,503 |   |
| Land                                                                                                                                     |   |     | 3,910,215   |     |   | 3,910,215 |   |
| Buildings                and improvements (net of accumulated depreciation of $63,114,230                and                $59,020,313) |   |     | 54,101,042  |     |   | 57,047,815 |   |
| Intangible                assets (net of accumulated amortization of $607,723                and $584,157)                          |   |     | 415,653     |     |   | 454,845 |   |
| Other                assets                                                                                                              |   |     | 1,273,041   |     |   | 1,187,479 |   |
|                                                                                                                                     |   | $        | 67,331,122  |     | $      | 70,101,132 |   |
| **LIABILITIES                AND PARTNERS' EQUITY (DEFICIT)**                                                                            |   |     |        |     |   |   |   |
|                                                                                                                                     |   |     |        |     |   |   |   |
| Liabilities                                                                                                                              |   |     |        |     |   |   |   |
| Accounts                payable and accrued expenses                                                                                     |   | $        | 2,202,753   |     | $      | 1,543,673 |   |
| Due                to related parties                                                                                                    |   |     | 5,284,304   |     |   | 5,276,278 |   |
| Mortgage                loans                                                                                                            |   |     | 80,524,806  |     |   | 81,216,029 |   |
| Accrued                interest                                                                                                          |   |     | 5,428,098   |     |   | 5,234,491 |   |
| Other                liabilities                                                                                                         |   |     | 818,280     |     |   | 801,690 |   |
|                                                                                                                                     |   |     | 94,258,241  |     |   | 94,072,161 |   |
| Partners'                equity (deficit)                                                                                                |   |     |        |     |   |   |   |
| American                Tax Credit Properties III L.P.                                                                                   |   |     |        |     |   |   |   |
| Capital                contributions, net of distributions                                                                               |   |     | 28,758,986  |     |   | 28,718,103 |   |
| Cumulative                loss                                                                                                           |   |     | (26,881,391 | )        |   | (26,784,065 | ) |
|                                                                                                                                     |   |     | 1,877,595   |     |   | 1,934,038 |   |
|                                                                                                                                     |   |     |        |     |   |   |   |
| General                partners and other limited partners                                                                               |   |     |        |     |   |   |   |
| Capital                contributions, net of distributions                                                                               |   |     | (438,848    | )        |   | (416,813 | ) |
| Cumulative                loss                                                                                                           |   |     | (28,365,866 | )        |   | (25,488,254 | ) |
|                                                                                                                                     |   |     | (28,804,714 | )        |   | (25,905,067 | ) |
|                                                                                                                                     |   |     | (26,927,119 | )        |   | (23,971,029 | ) |
|                                                                                                                                     |   | $        | 67,331,122  |     | $      | 70,101,132 |   |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.      **
**Investment      in Local Partnerships (continued) **

|                                                                                                                                                                        |   | **2006** |       | **2005** |   | **2004**   |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|------------|----------|--------|------------|--------|
| **REVENUE**                                                                                                                                                                 |   |     |       |     |   |       |   |
| Rental                                                                                                                                                                      |   | $        | 12,260,770 |     | $      | 11,969,192 |   | $ | 11,668,579 |   |
| Interest                and other                                                                                                                                           |   |     | 398,638    |     |   | 681,809    |   |   | 336,144 |   |
| TOTAL                REVENUE                                                                                                                                                |   |     | 12,659,408 |     |   | 12,651,001 |   |   | 12,004,723 |   |
|                                                                                                                                                                        |   |     |       |     |   |       |   |   |   |   |
| **EXPENSES**                                                                                                                                                                |   |     |       |     |   |       |   |   |   |   |
| Administrative                                                                                                                                                              |   |     | 2,831,638  |     |   | 2,720,218  |   |   | 2,898,828 |   |
| Utilities                                                                                                                                                                   |   |     | 1,784,166  |     |   | 1,581,055  |   |   | 1,380,506 |   |
| Operating                and maintenance                                                                                                                                    |   |     | 2,983,376  |     |   | 3,031,326  |   |   | 3,033,442 |   |
| Taxes                and insurance                                                                                                                                          |   |     | 1,283,973  |     |   | 1,269,953  |   |   | 1,267,542 |   |
| Financial                                                                                                                                                                   |   |     | 2,590,917  |     |   | 2,677,462  |   |   | 2,708,549 |   |
| Depreciation                and amortization                                                                                                                                |   |     | 4,160,276  |     |   | 4,123,905  |   |   | 4,049,667 |   |
| TOTAL                EXPENSES                                                                                                                                               |   |     | 15,634,346 |     |   | 15,403,919 |   |   | 15,338,534 |   |
|                                                                                                                                                                        |   |     |       |     |   |       |   |   |   |   |
| **NET                LOSS**                                                                                                                                                 |   | $        | (2,974,938 | )        | $      | (2,752,918 | )      | $ | (3,333,811 | ) |
|                                                                                                                                                                        |   |     |       |     |   |       |   |   |   |   |
| **NET                LOSS ATTRIBUTABLE TO**                                                                                                                                 |   |     |       |     |   |       |   |   |   |   |
| American                Tax Credit Properties III L.P.                                                                                                                      |   | $        | (97,326    | )        | $      | (156,237   | )      | $ | (247,207 | ) |
| General                partners and other limited partners, which includes $2,668,471, $2,360,295                and $2,726,948 of Partnership loss in excess of investment |   |     | (2,877,612 | )        |   | (2,596,681 | )      |   | (3,086,604 | ) |
|                                                                                                                                                                        |   | $        | (2,974,938 | )        | $      | (2,752,918 | )      | $ | (3,333,811 | ) |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.      **
**Investment      in Local Partnerships (continued) **

| Name                of Local Partnership                                           |   |  Investmentin                Local Partnershipbalance                as of March                30, 2006 |    |  Investmentduring                the year endedMarch                30, 2007 |   |  Partnership'sequity                inloss                for theyear                endedDecember                31,2006 |   |  Adjustment                to carrying value during theyear                endedMarch                30,2007 |     |  Cashdistributionsreceived                during theyear                endedMarch                30, 2007                (3) |   |  Investmentin                LocalPartnershipbalance                as ofMarch                30, 2007 |   |
|------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------|---------|-----------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------|----------|------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------|--------|
| April                Gardens Apartments II Limited Partnership                     |   | $                                                                                                             | — |                                                                              | $      | —                                                                                                                        |   | $                                                                                                                 | —  | (1)                                                                                                                                | $      | —                                                                                                     |   | $ | — |   | $ | — |   |
| Ashland                Park Apartments, L.P.                                       |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Auburn                Family, L.P.                                                 |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Batesville                Family, L.P.                                             |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Bay                Springs Elderly, L.P.                                           |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Brisas                del Mar Apartments Limited Partnership                       |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              |     |                                                                                                                                    |   | —                                                                                                     |   |   | — |   |   | — |   |
| Bruce                Housing Associates, L.P.                                      |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Carrington                Limited Dividend Housing Association Limited Partnership |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Chestnut                Park Associates, L.P.                                      |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Chowan                Senior Manor Associates Limited Partnership                  |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Christian                Street Commons Associates                                 |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Country                View Apartments                                             |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Desarrollos                de Belen Limited Partnership                            |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Desarrollos                de Emaus Limited Partnership                            |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Ellinwood                Heights Apartments, L.P.                                  |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Fulton                Street Houses Limited Partnership                            |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Hayes                Run Limited Partnership                                       |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Howard                L. Miller Sallisaw Apartments II, L.P.                       |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Hurlock                Meadow Limited Partnership                                  |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Ivy                Family, L.P.                                                    |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Justin                Associates                                                   |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Lawrence                Road Properties, Ltd.                                      |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Labelle                Commons, Ltd.                                               |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Loma                Del Norte Limited Partnership                                  |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Long                Reach Associates Limited Partnership                           |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Mirador                del Toa Limited Partnership                                 |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Moore                Haven Commons, Ltd.                                           |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| NP-89                Limited Dividend Housing Association Limited Partnership      |   |                                                                                                          | 578,827 |                                                                              |   | —                                                                                                                        |   |                                                                                                              | 7,985    |                                                                                                                               |   | —                                                                                                     |   |   | (10,000 | ) |   | 576,812 |   |
| Nash                Hill Associates, Limited Partnership                           |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| North                Calhoun City, L.P.                                            |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Orange                City Plaza, Limited Partnership                              |   |                                                                                                          | — |                                                                              |   | 105,311                                                                                                                        |   |                                                                                                              | (105,311 | )(2)                                                                                                                               |   | —                                                                                                     |   |   | — |   |   | — |   |
| Puerta                del Mar Limited Partnership                                  |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Purvis                Heights Properties, L.P.                                     |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Queen                Lane Investors                                                |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Somerset                Manor, Ltd.                                                |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Sugar                Cane Villas, Ltd.                                             |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Summerfield                Apartments Limited Partnership                          |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Sydney                Engel Associates L.P.                                        |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Union                Valley Associates Limited Partnership                         |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Walnut                Grove Family, L.P.                                           |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Waynesboro                Apartments Limited Partnership                           |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| West                Calhoun City, L.P.                                             |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
| Westminster                Apartments Limited Partnership                          |   |                                                                                                          | — |                                                                              |   | —                                                                                                                        |   |                                                                                                              | —  | (1)                                                                                                                                |   | —                                                                                                     |   |   | — |   |   | — |   |
|                                                                               |   | $                                                                                                             | 578,827 |                                                                              | $      | 105,311                                                                                                                        |   | $                                                                                                                 | (97,326  | )                                                                                                                                  | $      | —                                                                                                     |   | $ | (10,000 | ) | $ | 576,812 |   |

| (1) | Additional                equity in loss of investment is not allocated to the Partnership                until                equity in income is earned or additional investment is made by the                Partnership. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The                Partnership’s equity in loss of an investment in a Local Partnership is                limited to the remaining investment                balance. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | The                total excludes $23,040 of distributions received classified as other                income from local partnerships |
|-----|---------------------------------------------------------------------------------------------------------------------------------------|

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.      **
**Investment      in Local Partnerships (continued) **

| Name                of Local Partnership                                           |   | Investmentin                Local Partnershipbalance                as of March                30, 2005 |    | Partnership'sequity                inloss                for theyear                endedDecember                31,2005 |   | Adjustment                to carrying value during theyear                endedMarch                30, 2006 |   | Cashdistributionsreceived                during theyear                endedMarch                30, 2006 |    | Cash                distributions classified as other income during the year                endedMarch                30, 2006 |   | Investmentin                LocalPartnershipbalance                as ofMarch                30, 2006 |   |
|------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------|---------|--------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------|---------|--------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------|--------|
| April                Gardens Apartments II Limited Partnership                     |   | $                                                                                                       | — |                                                                                                                     | $      | —                                                                                                      | (1)    | $                                                                                                         | — |                                                                                                                           | $      | (1,920                                                                                                | )      | $ | 1,920 |   | $ | — |   |
| Ashland                Park Apartments, L.P.                                       |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Auburn                Family, L.P.                                                 |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Batesville                Family, L.P.                                             |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Bay                Springs Elderly, L.P.                                           |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Brisas                del Mar Apartments Limited Partnership                       |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (2,640                                                                                                | )      |   | 2,640 |   |   | — |   |
| Bruce                Housing Associates, L.P.                                      |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Carrington                Limited Dividend Housing Association Limited Partnership |   |                                                                                                    | 83,073  |                                                                                                                     |   | (83,073                                                                                                      | )(2)   |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Chestnut                Park Associates, L.P.                                      |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Chowan                Senior Manor Associates Limited Partnership                  |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (3,160                                                                                                | )      |   | 3,160 |   |   | — |   |
| Christian                Street Commons Associates                                 |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Country                View Apartments                                             |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (750                                                                                                  | )      |   | 750 |   |   | — |   |
| Desarrollos                de Belen Limited Partnership                            |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (2,000                                                                                                | )      |   | 2,000 |   |   | — |   |
| Desarrollos                de Emaus Limited Partnership                            |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (3,000                                                                                                | )      |   | 3,000 |   |   | — |   |
| Ellinwood                Heights Apartments, L.P.                                  |   |                                                                                                    | 36,742  |                                                                                                                     |   | (30,131                                                                                                      | )      |                                                                                                      | (6,130  | )(3)                                                                                                                           |   | (481                                                                                                  | )      |   | — |   |   | — |   |
| Fulton                Street Houses Limited Partnership                            |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Hayes                Run Limited Partnership                                       |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (1,785                                                                                                | )      |   | 1,785 |   |   | — |   |
| Howard                L. Miller Sallisaw Apartments II, L.P.                       |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Hurlock                Meadow Limited Partnership                                  |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (1,587                                                                                                | )      |   | 1,587 |   |   | — |   |
| Ivy                Family, L.P.                                                    |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Justin                Associates                                                   |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Lawrence                Road Properties, Ltd.                                      |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Labelle                Commons, Ltd.                                               |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Loma                Del Norte Limited Partnership                                  |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (4,000                                                                                                | )      |   | 4,000 |   |   | — |   |
| Long                Reach Associates Limited Partnership                           |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (3,675                                                                                                | )      |   | 3,675 |   |   | — |   |
| Mirador                del Toa Limited Partnership                                 |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (960                                                                                                  | )      |   | 960 |   |   | — |   |
| Moore                Haven Commons, Ltd.                                           |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| NP-89                Limited Dividend Housing Association Limited Partnership      |   |                                                                                                    | 631,860 |                                                                                                                     |   | (43,033                                                                                                      | )      |                                                                                                      | — |                                                                                                                           |   | (10,000                                                                                               | )      |   | — |   |   | 578,827 |   |
| Nash                Hill Associates, Limited Partnership                           |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| North                Calhoun City, L.P.                                            |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Orange                City Plaza, Limited Partnership                              |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Puerta                del Mar Limited Partnership                                  |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (2,640                                                                                                | )      |   | 2,640 |   |   | — |   |
| Purvis                Heights Properties, L.P.                                     |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Queen                Lane Investors                                                |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Somerset                Manor, Ltd.                                                |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Sugar                Cane Villas, Ltd.                                             |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (8,636                                                                                                | )      |   | 8,636 |   |   | — |   |
| Summerfield                Apartments Limited Partnership                          |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (5,000                                                                                                | )      |   | 5,000 |   |   | — |   |
| Sydney                Engel Associates L.P.                                        |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Union                Valley Associates Limited Partnership                         |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Walnut                Grove Family, L.P.                                           |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Waynesboro                Apartments Limited Partnership                           |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | (3,750                                                                                                | )      |   | 3,750 |   |   | — |   |
| West                Calhoun City, L.P.                                             |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
| Westminster                Apartments Limited Partnership                          |   |                                                                                                    | — |                                                                                                                     |   | —                                                                                                      | (1)    |                                                                                                      | — |                                                                                                                           |   | —                                                                                               |   |   | — |   |   | — |   |
|                                                                               |   | $                                                                                                       | 751,675 |                                                                                                                     | $      | (156,237                                                                                                     | )      | $                                                                                                         | (6,130  | )                                                                                                                              | $      | (55,984                                                                                               | )      | $ | 45,503 |   | $ | 578,827 |   |

| (1) | Additional                equity in loss of investment is not allocated to the Partnership                until                equity in income is earned or additional investment is made by the                Partnership. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The                Partnership’s equity in loss of an investment in a Local Partnership is                limited to the remaining investment                balance. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | The                Partnership has adjusted the investment’s carrying value in accordance                with applicable accounting                guidelines. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.      **
**Investment      in Local Partnerships (continued) **

|  Name                of Local Partnership                                     |   | Mortgage                loans                payable |       |  Land |   | Buildings                and improvements |   | Accumulated                depreciation |        |
|------------------------------------------------------------------------------------|--------|------------------------------------------------------|------------|------------|--------|-------------------------------------------|--------|-----------------------------------------|-------------|
| April                Gardens Apartments II Limited Partnership                     |   | $                                                    | 1,950,265  |       | $      | 39,984                                    |   | $                                       | 2,509,656   |   | $ | (1,610,646 | ) |
| Ashland                Park Apartments, L.P.                                       |   |                                                 | 1,012,345  |       |   | 50,160                                    |   |                                    | 1,270,002   |   |   | (734,965 | ) |
| Auburn                Family, L.P.                                                 |   |                                                 | 448,594    |       |   | 20,000                                    |   |                                    | 592,581     |   |   | (292,150 | ) |
| Batesville                Family, L.P.                                             |   |                                                 | 1,408,946  |       |   | 52,000                                    |   |                                    | 1,871,107   |   |   | (893,995 | ) |
| Bay                Springs Elderly, L.P.                                           |   |                                                 | 660,822    |       |   | 38,000                                    |   |                                    | 933,986     |   |   | (427,834 | ) |
| Brisas                del Mar Apartments Limited Partnership                       |   |                                                 | 2,585,595  |       |   | 100,280                                   |   |                                    | 3,407,603   |   |   | (2,161,762 | ) |
| Bruce                Housing Associates, L.P.                                      |   |                                                 | 1,077,661  |       |   | 16,000                                    |   |                                    | 1,609,710   |   |   | (860,809 | ) |
| Carrington                Limited Dividend Housing Association Limited Partnership |   |                                                 | 3,123,538  |       |   | 200,000                                   |   |                                    | 6,617,582   |   |   | (3,988,180 | ) |
| Chestnut                Park Associates, L.P.                                      |   |                                                 | 4,574,324  |       |   | 781,700                                   |   |                                    | 8,700,511   |   |   | (4,949,265 | ) |
| Chowan                Senior Manor Associates Limited Partnership                  |   |                                                 | 1,212,836  |       |   | 86,101                                    |   |                                    | 1,530,162   |   |   | (915,320 | ) |
| Christian                Street Commons Associates                                 |   |                                                 | 547,872    |       |   | —                                   |   |                                    | 7,545       |   |   | (2,181 | ) |
| Country                View Apartments                                             |   |                                                 | 914,962    |       |   | 35,698                                    |   |                                    | 1,280,230   |   |   | (486,312 | ) |
| Desarrollos                de Belen Limited Partnership                            |   |                                                 | 1,835,769  |       |   | 96,190                                    |   |                                    | 2,519,166   |   |   | (1,207,344 | ) |
| Desarrollos                de Emaus Limited Partnership                            |   |                                                 | 3,119,964  |       |   | 214,000                                   |   |                                    | 4,046,102   |   |   | (1,858,909 | ) |
| Ellinwood                Heights Apartments, L.P.                                  |   |                                                 | 671,724    |       |   | 10,000                                    |   |                                    | 1,002,504   |   |   | (386,866 | ) |
| Fulton                Street Houses Limited Partnership                            |   |                                                 | 3,869,930  |       |   | 2                                         |   |                                    | 5,978,435   |   |   | (3,229,747 | ) |
| Hayes                Run Limited Partnership                                       |   |                                                 | 1,392,485  |       |   | 85,060                                    |   |                                    | 1,686,732   |   |   | (664,244 | ) |
| Howard                L. Miller Sallisaw Apartments II, L.P.                       |   |                                                 | 602,039    |       |   | 39,000                                    |   |                                    | 737,883     |   |   | (290,422 | ) |
| Hurlock                Meadow Limited Partnership                                  |   |                                                 | 1,238,575  |       |   | 49,525                                    |   |                                    | 1,633,277   |   |   | (912,452 | ) |
| Ivy                Family, L.P.                                                    |   |                                                 | 750,706    |       |   | 11,000                                    |   |                                    | 1,121,325   |   |   | (639,336 | ) |
| Justin                Associates                                                   |   |                                                 | 2,114,932  |       |   | 27,472                                    |   |                                    | 4,372,042   |   |   | (2,389,118 | ) |
| LaBelle                Commons, Ltd.                                               |   |                                                 | 988,498    |       |   | 98,947                                    |   |                                    | 1,263,737   |   |   | (636,268 | ) |
| Lawrence                Road Properties, Ltd.                                      |   |                                                 | 741,086    |       |   | 50,000                                    |   |                                    | 973,606     |   |   | (459,758 | ) |
| Loma                Del Norte Limited Partnership                                  |   |                                                 | 1,405,307  |       |   | 84,874                                    |   |                                    | 1,931,832   |   |   | (777,628 | ) |
| Long                Reach Associates Limited Partnership                           |   |                                                 | 1,445,189  |       |   | 118,446                                   |   |                                    | 1,924,333   |   |   | (817,226 | ) |
| Mirador                del Toa Limited Partnership                                 |   |                                                 | 1,832,459  |       |   | 105,000                                   |   |                                    | 2,364,101   |   |   | (1,512,129 | ) |
| Moore                Haven Commons, Ltd.                                           |   |                                                 | 906,141    |       |   | 73,645                                    |   |                                    | 1,199,226   |   |   | (707,695 | ) |
| NP-89                Limited Dividend Housing Association Limited Partnership      |   |                                                 | 3,282,877  |       |   | 150,000                                   |   |                                    | 7,849,324   |   |   | (4,347,376 | ) |
| Nash                Hill Associates, Limited Partnership                           |   |                                                 | 1,434,317  |       |   | 123,876                                   |   |                                    | 1,762,654   |   |   | (729,890 | ) |
| North                Calhoun City, L.P.                                            |   |                                                 | 460,664    |       |   | 12,000                                    |   |                                    | 670,388     |   |   | (328,626 | ) |
| Orange                City Plaza, Limited Partnership                              |   |                                                 | 393,027    |       |   | 53,904                                    |   |                                    | 1,051,852   |   |   | (477,983 | ) |
| Puerta                del Mar Limited Partnership                                  |   |                                                 | 2,460,339  |       |   | 115,000                                   |   |                                    | 3,157,525   |   |   | (1,984,119 | ) |
| Purvis                Heights Properties, L.P.                                     |   |                                                 | 1,121,965  |       |   | 47,000                                    |   |                                    | 1,571,653   |   |   | (688,618 | ) |
| Queen                Lane Investors                                                |   |                                                 | 1,647,041  |       |   | 60,301                                    |   |                                    | 2,840,568   |   |   | (1,622,323 | ) |
| Somerset                Manor, Ltd.                                                |   |                                                 | 877,468    |       |   | 53,383                                    |   |                                    | 1,126,905   |   |   | (654,492 | ) |
| Sugar                Cane Villas, Ltd.                                             |   |                                                 | 3,232,530  |       |   | 58,500                                    |   |                                    | 4,093,772   |   |   | (2,402,442 | ) |
| Summerfield                Apartments Limited Partnership                          |   |                                                 | 1,532,337  |       |   | 195,411                                   |   |                                    | 2,775,519   |   |   | (1,043,241 | ) |
| Sydney                Engel Associates L.P.                                        |   |                                                 | 15,649,510 |       |   | 284,305                                   |   |                                    | 20,263,692  |   |   | (11,466,992 | ) |
| Union                Valley Associates Limited Partnership                         |   |                                                 | 1,414,313  |       |   | 97,800                                    |   |                                    | 1,758,877   |   |   | (713,845 | ) |
| Walnut                Grove Family, L.P.                                           |   |                                                 | 829,424    |       |   | 30,000                                    |   |                                    | 1,074,112   |   |   | (553,737 | ) |
| Waynesboro                Apartments Limited Partnership                           |   |                                                 | 1,447,008  |       |   | 76,000                                    |   |                                    | 1,794,917   |   |   | (751,140 | ) |
| West                Calhoun City, L.P.                                             |   |                                                 | 701,450    |       |   | 18,000                                    |   |                                    | 1,104,158   |   |   | (539,046 | ) |
| Westminster                Apartments Limited Partnership                          |   |                                                 | 1,607,972  |       |   | 51,651                                    |   |                                    | 1,234,380   |   |   | (997,799 | ) |
|                                                                               |   | $                                                    | 80,524,806 |       | $      | 3,910,215                                 |   | $                                       | 117,215,272 |   | $ | (63,114,230 | ) |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.      **
**Investment      in Local Partnerships (continued) **

|  Name                of Local Partnership                                     |   | Mortgage                loans                payable |       |  Land |   | Buildings                and improvements |   | Accumulated                depreciation |        |
|------------------------------------------------------------------------------------|--------|------------------------------------------------------|------------|------------|--------|-------------------------------------------|--------|-----------------------------------------|-------------|
| April                Gardens Apartments II Limited Partnership                     |   | $                                                    | 1,958,868  |       | $      | 39,984                                    |   | $                                       | 2,509,656   |   | $ | (1,510,956 | ) |
| Ashland                Park Apartments, L.P.                                       |   |                                                 | 1,017,021  |       |   | 50,160                                    |   |                                    | 1,258,565   |   |   | (685,600 | ) |
| Auburn                Family, L.P.                                                 |   |                                                 | 452,267    |       |   | 20,000                                    |   |                                    | 588,988     |   |   | (278,942 | ) |
| Batesville                Family, L.P.                                             |   |                                                 | 1,414,432  |       |   | 52,000                                    |   |                                    | 1,849,449   |   |   | (846,743 | ) |
| Bay                Springs Elderly, L.P.                                           |   |                                                 | 663,582    |       |   | 38,000                                    |   |                                    | 880,135     |   |   | (408,762 | ) |
| Brisas                del Mar Apartments Limited Partnership                       |   |                                                 | 2,598,116  |       |   | 100,280                                   |   |                                    | 3,397,603   |   |   | (2,024,156 | ) |
| Bruce                Housing Associates, L.P.                                      |   |                                                 | 1,083,041  |       |   | 16,000                                    |   |                                    | 1,501,937   |   |   | (811,723 | ) |
| Carrington                Limited Dividend Housing Association Limited Partnership |   |                                                 | 3,178,196  |       |   | 200,000                                   |   |                                    | 6,612,228   |   |   | (3,744,697 | ) |
| Chestnut                Park Associates, L.P.                                      |   |                                                 | 4,677,658  |       |   | 781,700                                   |   |                                    | 8,654,778   |   |   | (4,634,267 | ) |
| Chowan                Senior Manor Associates Limited Partnership                  |   |                                                 | 1,220,453  |       |   | 86,101                                    |   |                                    | 1,530,162   |   |   | (857,071 | ) |
| Christian                Street Commons Associates                                 |   |                                                 | 559,787    |       |   | —                                   |   |                                    | 7,545       |   |   | (1,907 | ) |
| Country                View Apartments                                             |   |                                                 | 919,026    |       |   | 35,698                                    |   |                                    | 1,273,646   |   |   | (450,710 | ) |
| Desarrollos                de Belen Limited Partnership                            |   |                                                 | 1,843,443  |       |   | 96,190                                    |   |                                    | 2,519,166   |   |   | (1,124,187 | ) |
| Desarrollos                de Emaus Limited Partnership                            |   |                                                 | 3,133,501  |       |   | 214,000                                   |   |                                    | 4,046,102   |   |   | (1,724,295 | ) |
| Ellinwood                Heights Apartments, L.P.                                  |   |                                                 | 674,705    |       |   | 10,000                                    |   |                                    | 989,302     |   |   | (351,395 | ) |
| Fulton                Street Houses Limited Partnership                            |   |                                                 | 3,869,930  |       |   | 2                                         |   |                                    | 5,964,514   |   |   | (3,008,642 | ) |
| Hayes                Run Limited Partnership                                       |   |                                                 | 1,398,569  |       |   | 85,060                                    |   |                                    | 1,647,734   |   |   | (602,230 | ) |
| Howard                L. Miller Sallisaw Apartments II, L.P.                       |   |                                                 | 604,552    |       |   | 39,000                                    |   |                                    | 734,163     |   |   | (274,457 | ) |
| Hurlock                Meadow Limited Partnership                                  |   |                                                 | 1,244,361  |       |   | 49,525                                    |   |                                    | 1,616,742   |   |   | (854,529 | ) |
| Ivy                Family, L.P.                                                    |   |                                                 | 758,570    |       |   | 11,000                                    |   |                                    | 1,103,816   |   |   | (604,642 | ) |
| Justin                Associates                                                   |   |                                                 | 2,170,491  |       |   | 27,472                                    |   |                                    | 4,369,992   |   |   | (2,229,451 | ) |
| LaBelle                Commons, Ltd.                                               |   |                                                 | 992,984    |       |   | 98,947                                    |   |                                    | 1,263,737   |   |   | (587,992 | ) |
| Lawrence                Road Properties, Ltd.                                      |   |                                                 | 744,352    |       |   | 50,000                                    |   |                                    | 973,606     |   |   | (434,723 | ) |
| Loma                Del Norte Limited Partnership                                  |   |                                                 | 1,411,220  |       |   | 84,874                                    |   |                                    | 1,917,493   |   |   | (722,027 | ) |
| Long                Reach Associates Limited Partnership                           |   |                                                 | 1,451,360  |       |   | 118,446                                   |   |                                    | 1,922,789   |   |   | (767,339 | ) |
| Mirador                del Toa Limited Partnership                                 |   |                                                 | 1,841,657  |       |   | 105,000                                   |   |                                    | 2,357,697   |   |   | (1,417,533 | ) |
| Moore                Haven Commons, Ltd.                                           |   |                                                 | 910,164    |       |   | 73,645                                    |   |                                    | 1,197,000   |   |   | (665,392 | ) |
| NP-89                Limited Dividend Housing Association Limited Partnership      |   |                                                 | 3,456,300  |       |   | 150,000                                   |   |                                    | 7,737,233   |   |   | (4,043,278 | ) |
| Nash                Hill Associates, Limited Partnership                           |   |                                                 | 1,440,685  |       |   | 123,876                                   |   |                                    | 1,762,654   |   |   | (679,722 | ) |
| North                Calhoun City, L.P.                                            |   |                                                 | 465,815    |       |   | 12,000                                    |   |                                    | 668,703     |   |   | (313,626 | ) |
| Orange                City Plaza, Limited Partnership                              |   |                                                 | 402,140    |       |   | 53,904                                    |   |                                    | 1,051,852   |   |   | (453,921 | ) |
| Puerta                del Mar Limited Partnership                                  |   |                                                 | 2,472,254  |       |   | 115,000                                   |   |                                    | 3,145,351   |   |   | (1,858,712 | ) |
| Purvis                Heights Properties, L.P.                                     |   |                                                 | 1,127,010  |       |   | 47,000                                    |   |                                    | 1,566,011   |   |   | (654,922 | ) |
| Queen                Lane Investors                                                |   |                                                 | 1,513,915  |       |   | 60,301                                    |   |                                    | 2,837,184   |   |   | (1,515,094 | ) |
| Somerset                Manor, Ltd.                                                |   |                                                 | 881,188    |       |   | 53,383                                    |   |                                    | 1,123,979   |   |   | (614,199 | ) |
| Sugar                Cane Villas, Ltd.                                             |   |                                                 | 3,246,477  |       |   | 58,500                                    |   |                                    | 4,093,772   |   |   | (2,256,232 | ) |
| Summerfield                Apartments Limited Partnership                          |   |                                                 | 1,572,707  |       |   | 195,411                                   |   |                                    | 2,733,958   |   |   | (974,109 | ) |
| Sydney                Engel Associates L.P.                                        |   |                                                 | 15,816,870 |       |   | 284,305                                   |   |                                    | 19,708,396  |   |   | (10,698,532 | ) |
| Union                Valley Associates Limited Partnership                         |   |                                                 | 1,420,359  |       |   | 97,800                                    |   |                                    | 1,758,877   |   |   | (670,680 | ) |
| Walnut                Grove Family, L.P.                                           |   |                                                 | 832,673    |       |   | 30,000                                    |   |                                    | 1,069,358   |   |   | (525,517 | ) |
| Waynesboro                Apartments Limited Partnership                           |   |                                                 | 1,453,591  |       |   | 76,000                                    |   |                                    | 1,794,917   |   |   | (706,391 | ) |
| West                Calhoun City, L.P.                                             |   |                                                 | 713,767    |       |   | 18,000                                    |   |                                    | 1,100,764   |   |   | (511,224 | ) |
| Westminster                Apartments Limited Partnership                          |   |                                                 | 1,607,972  |       |   | 51,651                                    |   |                                    | 1,226,574   |   |   | (919,786 | ) |
|                                                                               |   | $                                                    | 81,216,029 |       | $      | 3,910,215                                 |   | $                                       | 116,068,128 |   | $ | (59,020,313 | ) |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**5.          **
**Investment          in Local Partnerships (continued)**

|                                      |   | Balance                as of December                31, 2005 |        | Net                change during                the year                ended December                31, 2006 |   | Balance                as of December                31, 2006 |   |
|-------------------------------------------|--------|---------------------------------------------------------------|-------------|----------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------|--------|
| Land                                      |   | $                                                             | 3,910,215   |                                                                                                           | $      | —                                                       |   | $ | 3,910,215 |   |
| Buildings                and improvements |   |                                                          | 116,068,128 |                                                                                                           |   | 1,147,144                                                     |   |   | 117,215,272 |   |
|                                      |   |                                                          | 119,978,343 |                                                                                                           |   | 1,147,144                                                     |   |   | 121,125,487 |   |
| Accumulated                depreciation   |   |                                                          | (59,020,313 | )                                                                                                              |   | (4,093,917                                                    | )      |   | (63,114,230 | ) |
|                                      |   | $                                                             | 60,958,030  |                                                                                                           | $      | (2,946,773                                                    | )      | $ | 58,011,257 |   |

**6.      **
**Transactions      with General Partner and Affiliates**

|                                            |   | 2007   |    | 2006     |   | 2005    |   |
|-------------------------------------------------|--------|--------|---------|----------|--------|---------|--------|
|                                            |   | Paid   |    | Incurred |   | Paid    |   | Incurred |   | Paid |   | Incurred |   |
| Management                fees (see Note 8)     |   | $      | 159,334 |     | $      | 228,313 |   | $ | 190,479 |   | $ | 230,571 |   | $ | 361,781 |   | $ | 230,571 |   |
|                                            |   |   |    |     |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Administration                fees (see Note 8) |   |   | 15,553  |     |   | 228,313 |   |   | 132,578 |   |   | 230,571 |   |   | 69,769 |   |   | 230,571 |   |

|                                                 |   | 2006   |    | 2005     |   | 2004    |   |
|------------------------------------------------------|--------|--------|---------|----------|--------|---------|--------|
|                                                 |   | Paid   |    | Incurred |   | Paid    |   | Incurred |   | Paid |   | Incurred |   |
| Property                management fees              |   | $      | 42,371  |     | $      | 40,010  |   | $ | 39,220 |   | $ | 40,010 |   | $ | 35,211 |   | $ | 40,010 |   |
|                                                 |   |   |    |     |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Insurance                premiums and other services |   |   | — |     |   | — |   |   | — |   |   | — |   |   | — |   |   | 17,040 |   |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**7.      **
**Taxable      Loss**

|                                                                                                                                        |   | 2007   |       | 2006   |   | 2005       |   |
|---------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|------------|--------|
| Financial                statement net loss for the years ended March 30, 2007, 2006 and                2005                                |   | $      | (431,945   | )      | $      | (620,078   | )      | $ | (640,259 | ) |
|                                                                                                                                        |   |   |       |   |   |       |   |   |   |   |
| Add                (less) net transactions occurring between                                                                                |   |   |       |   |   |       |   |   |   |   |
| January                1, 2004 and March 30, 2004                                                                                           |   |   |       |   |   |       |   |   | (95,397 | ) |
| January                1, 2005 and March 30, 2005                                                                                           |   |   | —    |   |   | (90,683    | )      |   | 90,683 |   |
| January                1, 2006 and March 30, 2006                                                                                           |   |   | (124,512   | )      |   | 124,512    |   |   | — |   |
| January                1, 2007 and March 30, 2007                                                                                           |   |   | (17,889    | )      |   | —    |   |   | — |   |
|                                                                                                                                        |   |   |       |   |   |       |   |   |   |   |
| Adjusted                financial statement net loss for the years ended December 31, 2006,                2005                and 2004     |   |   | (574,346   | )      |   | (586,249   | )      |   | (644,973 | ) |
|                                                                                                                                        |   |   |       |   |   |       |   |   |   |   |
| Adjustment                to management and administration fees pursuant to Internal Revenue                Code                Section 267 |   |   | 140,632    |   |   | 139,790    |   |   | 139,961 |   |
|                                                                                                                                        |   |   |       |   |   |       |   |   |   |   |
| Differences                arising from equity in loss of investment in local                partnerships                                   |   |   | (2,538,962 | )      |   | (2,621,397 | )      |   | (3,438,649 | ) |
|                                                                                                                                        |   |   |       |   |   |       |   |   |   |   |
| Other                income from local partnerships                                                                                         |   |   | (8,384     | )      |   | (39,332    | )      |   | (41,205 | ) |
|                                                                                                                                        |   |   |       |   |   |       |   |   |   |   |
| Other                differences                                                                                                            |   |   | (18,185    | )      |   | (144       | )      |   | 127 |   |
|                                                                                                                                        |   |   |       |   |   |       |   |   |   |   |
| Tax                return net loss for the years ended December 31, 2006, 2005 and                2004                                      |   | $      | (2,999,245 | )      | $      | (3,107,332 | )      | $ | (3,894,739 | ) |

|                                                                  |   | 2006   |        | 2005   |   |
|-----------------------------------------------------------------------|--------|--------|-------------|--------|--------|
| Investment                in local partnerships - financial reporting |   | $      | 576,812     |   | $      | 578,827 |   |
| Investment                in local partnerships - tax                 |   |   | (21,111,854 | )      |   | (18,434,718 | ) |
|                                                                  |   | $      | 21,688,666  |   | $      | 19,013,545 |   |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**8.      **
**Commitments      and Contingencies**

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**9.      **
**Fair      Value of Financial Instruments**

**10.      **
**Quarterly      Financial Information - Unaudited**

|                                                                                                      |   | First                  Quarter |     | Second                  Quarter |   | Third                  Quarter |   | Fourth                  Quarter |     |
|-----------------------------------------------------------------------------------------------------------|--------|--------------------------------|----------|---------------------------------|--------|--------------------------------|--------|---------------------------------|----------|
| 2007                                                                                                      |   |                           |     |                            |   |                           |   |                            |     |
|                                                                                                      |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Total                  revenue                                                                            |   | $                              | 39,254   |                            | $      | 29,554                         |   | $                               | 11,411   |   | $ | 14,865 |   |
|                                                                                                      |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Total                  expenses                                                                           |   |                           | (152,922 | )                               |   | (134,314                       | )      |                            | (146,491 | ) |   | (145,871 | ) |
|                                                                                                      |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Equity                  in income (loss) of investment in local partnerships                              |   |                           | (53,754  | )                               |   | (6,252                         | )      |                            | (60,585  | ) |   | 23,265 |   |
|                                                                                                      |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Gain                  on disposal limited partner interests/local partnership                  properties |   |                           |          |                            |   | —                        |   |                            | —  |   |   | 149,895 |   |
|                                                                                                      |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Net                  income (loss)                                                                        |   |                           | (167,422 | )                               |   | (111,012                       | )      |                            | (195,665 | ) |   | 42,154 |   |
|                                                                                                      |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Net                    income (loss) per unit of limited                    partnership interest          |   |                           | —  |                            |   | —                        |   |                            | —  |   |   | — |   |

----

**AMERICAN      TAX CREDIT PROPERTIES III L.P.**

**NOTES      TO FINANCIAL STATEMENTS - (Continued)**

**MARCH      30, 2007, 2006 AND 2005**

**10.**
**Quarterly      Financial Information - Unaudited (continued)**

|                                                                         |   | First                  Quarter |     | Second                  Quarter |   | Third                  Quarter |   | Fourth                  Quarter |     |
|------------------------------------------------------------------------------|--------|--------------------------------|----------|---------------------------------|--------|--------------------------------|--------|---------------------------------|----------|
| 2006                                                                         |   |                           |     |                            |   |                           |   |                            |     |
|                                                                         |   |                           |     |                            |   |                           |   |                            |     |
| Total                  revenue                                               |   | $                              | 40,796   |                            | $      | 46,049                         |   | $                               | 25,465   |   | $ | 30,527 |   |
|                                                                         |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Total                  expenses                                              |   |                           | (141,937 | )                               |   | (155,920                       | )      |                            | (147,652 | ) |   | (155,039 | ) |
|                                                                         |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Equity                  in income (loss) of investment in local partnerships |   |                           | (48,566  | )                               |   | (64,488                        | )      |                            | (60,678  | ) |   | 11,365 |   |
|                                                                         |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Net                  loss                                                    |   |                           | (149,707 | )                               |   | (174,359                       | )      |                            | (182,865 | ) |   | (113,147 | ) |
|                                                                         |   |                           |     |                            |   |                           |   |                            |     |   |   |   |   |
| Net                  income (loss) per unit of limited partnership interest  |   |                           | (4.13    | )                               |   | (4.81                          | )      |                            | (5.05    | ) |   | 2.55 |   |

----

**Item      9.**
**Changes      in and Disagreements with Accountants on Accounting and Financial      Disclosure**

**Item      9A. **
**Controls      and Procedures**

**Item      9B. **
**Other      Information**

**PART      III**

**Item      10.**
**Directors      and Executive Officers of the Registrant**

| Name                                |   | Served                  in present capacity                  since1   |   | Position                held                |
|-------------------------------------|--------|---------------------------------------------------------------------------------|--------|---------------------------------------------|
| Richard                Paul Richman |   | September                21, 1989                                               |   | Director                                    |
| David                A. Salzman     |   | February                1, 2001                                                 |   | President                                   |
| Neal                Ludeke          |   | September                21, 1989                                               |   | Vice                President and Treasurer |
| Gina                K. Dodge        |   | September                21, 1989                                               |   | Secretary                                   |

----

**Richard      Paul Richman**

**David      A. Salzman, **

**Neal      Ludeke**

**Gina      K. Dodge**

----

**Item      10.**
**Directors      and Executive Officers of the Registrant (continued)**

**Item      11.**
**Executive      Compensation**

**Item      12.**
**Security      Ownership of Certain Beneficial Owners and Management and Related Stockholder      Matters**

**Item      13. **
**Certain      Relationships and Related Transactions**

----

**Item      14. **
**Principal      Accountant Fees and Services**

|                                |   | 2007   |    | 2006   |   |
|-------------------------------------|--------|--------|---------|--------|--------|
| Audit                  Fees         |   | $      | 50,000  |   | $      | 47,182 |   |
| Audit-Related                  Fees |   |   | — |   |   | — |   |
| Tax                  Fees           |   | $      | 10,000  |   | $      | 10,893 |   |
| All                  Other Fees     |   |   | — |   |   | — |   |

----

**PART      IV**

**Item      15.**
**Exhibits      and Financial Statement Schedules**

**(a)      **
**Financial      Statements, Financial Statement Schedules and Exhibits**

**(1)      **
**Financial      Statements**

**(2)      **
**Financial      Statement Schedules**

**(3)      **
**Exhibits**

|   |   | Exhibit                                                                                                                                                                                                             |   | Incorporated                  by Reference                  to                                                                           |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------|
| 10.1   |   | April                Gardens Apartments II Limited Partnership (A Delaware Limited Partnership)                Amended and Restated Agreement of Limited Partnership                                                |   | Exhibit                10.1 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                     |
| 10.2   |   | Ashland                Park Apartments, L.P. Second Amended and Restated Agreement of Limited                Partnership                                                                                            |   | Exhibit                10.2 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                     |
| 10.3   |   | Auburn                Family, L.P. Amended and Restated Limited Partnership Agreement and                Certificate of Limited Partnership                                                                         |   | Exhibit                10.1 to Form 10-Q Report dated                December                31, 1991 (File                No. 0-19217)  |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                     |
| 10.4   |   | Amended                No. 2 to the Batesville Family, L.P. Amended and Restated Agreement                of                Limited Partnership                                                                     |   | Exhibit                10.2 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                     |
| 10.5   |   | Batesville                Family, L.P. Amendment No. 3 to the Amended and Restated Agreement                of                Limited Partnership                                                                   |   | Exhibit                10.2 to Form 10-Q Report dated                December                31, 1991 (File                No. 0-19217)  |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                     |
| 10.6   |   | Bay                Springs Elderly, L.P. (A Mississippi Limited Partnership) Amended                and                Restated Limited Partnership Agreement and Certificate of Limited                Partnership |   | Exhibit                10.1 to Form 10-Q Report dated                September                29, 1991 (File                No. 0-19217) |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                     |
| 10.7   |   | Brisas                del Mar Apartments Limited Partnership (A Delaware Limited Partnership)                Amended and Restated Agreement of Limited Partnership                                                  |   | Exhibit                10.3 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                     |
| 10.8   |   | Amendment                No. 1 to the Bruce Housing Associates, L.P. Amended and Restated                Agreement                of Limited Partnership                                                            |   | Exhibit                10.8 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |

----

|   |   | Exhibit                                                                                                                                                                                                             |   | Incorporated                  by Reference                  to                                                                            |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|
| 10.9   |   | Amendment                No. 2 to the Bruce Housing Associates, L.P. Amended and Restated                Agreement                of Limited Partnership                                                            |   | Exhibit                10.4 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.10  |   | Bruce                Housing Associates, L.P. Amendment No. 3 to the Amended and Restated                Agreement of Limited Partnership                                                                           |   | Exhibit                10.3 to Form 10-Q Report dated                December                31, 1991 (File                No. 0-19217)   |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.11  |   | Carrington                Limited Dividend Housing Association Limited Partnership Amended                and                Restated Agreement of Limited Partnership                                              |   | Exhibit                10.1 to Form 10-Q Report dated                September                29, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.12  |   | Carrington                Limited Dividend Housing Association Limited Partnership Second Amended                and Restated Agreement of Limited Partnership                                                      |   | Exhibit                10.2 to Form 10-Q Report dated                September                29, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.13  |   | Carrington                Limited Dividend Housing Association Limited Partnership Amendment                No. 1                to the Second Amended and Restated Agreement of Limited                Partnership |   | Exhibit                10.5 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.14  |   | Chestnut                Park Associates, L.P. Amended and Restated Agreement of Limited                Partnership                                                                                                  |   | Exhibit                10.3 to Form 10-Q Report dated                September                29, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.15  |   | Chowan                Senior Manor Associates Limited Partnership Amended and Restated                Agreement                of Limited Partnership                                                               |   | Exhibit                10.15 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.16  |   | Christian                Street Commons Associates Amended and Restated Limited Partnership                Agreement and Certificate of Limited Partnership                                                         |   | Exhibit                10.16 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.17  |   | Country                View Apartments Second Amended and Restated Limited Partnership Agreement                and Certificate of Limited Partnership                                                              |   | Exhibit                10.17 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.18  |   | Desarrollos                de Belen Limited Partnership Amended and Restated Agreement of Limited                Partnership                                                                                        |   | Exhibit                10.18 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.19  |   | Desarrollos                de Emaus Limited Partnership Amended and Restated Agreement of Limited                Partnership                                                                                        |   | Exhibit                10.19 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.20  |   | Ellinwood                Heights Apartments, L.P. Amended and Restated Agreement of Limited                Partnership                                                                                              |   | Exhibit                10.1 to Form 10-Q Report dated                June                29, 1991 (File                No. 0-19217)       |

----

|   |   | Exhibit                                                                                                                                                  |   | Incorporated                  by Reference                  to                              |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------|
| 10.21  |   | Fulton                Street Houses Limited Partnership Amended and Restated Agreement                of                Limited Partnership              |   | Exhibit                10.21 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)   |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.22  |   | Hayes                Run Limited Partnership Amended and Restated Agreement of Limited                Partnership                                        |   | Exhibit                10.2 to Form 10-Q Report dated                June                29, 1991 (File                No. 0-19217)      |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.23  |   | Howard                L. Miller Sallisaw Apartments II, L.P. Third Amended and Restated                Agreement and Certificate of Limited Partnership  |   | Exhibit                10.10 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)   |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.24  |   | Hurlock                Meadow Limited Partnership Amended and Restated Limited Partnership                Agreement                                      |   | Exhibit                10.24 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)   |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.25  |   | Amendment                No. 1 to the Ivy Family, L.P. Amended and Restated Agreement of Limited                Partnership                              |   | Exhibit                10.6 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.26  |   | Ivy                Family, L.P. Amendment No. 3 to the Amended and Restated Agreement                of                Limited Partnership               |   | Exhibit                10.4 to Form 10-Q Report dated                December                31, 1991 (File                No. 0-19217)  |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.27  |   | Justin                Associates Amended and Restated Agreement and Certificate of Limited                Partnership                                    |   | Exhibit                10.7 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.28  |   | LaBelle                Commons, Ltd. Amended and Restated Agreement of Limited                Partnership                                                |   | Exhibit                10.13 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)   |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.29  |   | LaBelle                Commons, Ltd. Amendment No. 1 to Amended and Restated Agreement of                Limited                Partnership              |   | Exhibit                10.29 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)   |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.30  |   | Amendment                No. 2 to the Lawrence Road Properties, Ltd. Amended and Restated                Agreement                of Limited Partnership |   | Exhibit                10.8 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.31  |   | Lawrence                Road Properties, Ltd. Amendment No. 3 to the Amended and Restated                Agreement of Limited Partnership                |   | Exhibit                10.5 to Form 10-Q Report dated                December                31, 1991 (File                No. 0-19217)  |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.32  |   | Loma                Del Norte Limited Partnership Amended and Restated Limited Partnership                Agreement                                      |   | Exhibit                10.2 to Form 10-Q Report dated                September                29, 1991 (File                No. 0-19217) |
|   |   |                                                                                                                                                     |   |                                                                                                                                     |
| 10.33  |   | Long                Reach Associates Limited Partnership Sixth Amended and Restated Agreement                of Limited Partnership                      |   | Exhibit                10.15 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)   |

----

|   |   | Exhibit                                                                                                                                                                                             |   | Incorporated                  by Reference                  to                               |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|
| 10.34  |   | Mirador                del Toa Limited Partnership Amended and Restated Agreement of Limited                Partnership                                                                             |   | Exhibit                10.16 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.35  |   | Amendment                No. 1 to the Mirador del Toa Limited Partnership Amended and Restated                Agreement of Limited Partnership                                                      |   | Exhibit                10.17 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.36  |   | Moore                Haven Commons, Ltd. Amended and Restated Agreement of Limited                Partnership                                                                                       |   | Exhibit                10.9 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.37  |   | NP-89                Limited Dividend Housing Association Limited Partnership Second Restated                and Amended Agreement of Limited Partnership                                           |   | Exhibit                10.3 to Form 10-Q Report dated                June                29, 1991 (File                No. 0-19217)       |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.38  |   | Nash                Hill Associates, Limited Partnership Amended and Restated Agreement                of                Limited Partnership                                                        |   | Exhibit                10.37 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.39  |   | North                Calhoun City, L.P. (A Mississippi Limited Partnership) Amended and                Restated Limited Partnership Agreement and Certificate of Limited                Partnership |   | Exhibit                10.3 to Form 10-Q Report dated                September                29, 1991 (File                No. 0-19217)  |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.40  |   | Orange                City Plaza, Limited Partnership Amended and Restated Partnership                Agreement                                                                                     |   | Exhibit                10.40 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.41  |   | Puerta                del Mar Limited Partnership (A Delaware Limited Partnership) Amended                and                Restated Agreement of Limited Partnership                              |   | Exhibit                10.10 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.42  |   | Amendment                No. 2 to the Purvis Heights Properties, L.P. Amended and Restated                Agreement of Limited Partnership                                                          |   | Exhibit                10.11 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.43  |   | Purvis                Heights Properties, L.P. Amendment No. 3 to the Amended and Restated                Agreement of Limited Partnership                                                          |   | Exhibit                10.6 to Form 10-Q Report dated                December                31, 1991 (File                No. 0-19217)   |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.44  |   | Queen                Lane Investors Amendment No. 1 to Amended and Restated Agreement                and                Certificate of Limited Partnership                                          |   | Exhibit                10.12 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.45  |   | Somerset                Manor, Ltd. Amended and Restated Agreement and Certificate of Limited                Partnership                                                                            |   | Exhibit                10.13 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                |   |                                                                                                                                      |
| 10.46  |   | Sugar                Cane Villas, Ltd. Amended and Restated Agreement of Limited                Partnership                                                                                         |   | Exhibit                10.23 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)    |

----

|   |   | Exhibit                                                                                                                                                                                              |   | Incorporated                  by Reference                  to                               |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|
| 10.47  |   | Summerfield                Apartments Limited Partnership Amended and Restated Agreement of                Limited                Partnership                                                        |   | Exhibit                10.47 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.48  |   | Amendment                No.1 to the Summerfield Apartments Limited Partnership Amended and                Restated Agreement of Limited Partnership                                                 |   | Exhibit                10.48 to Form 10-K Report dated                March                30, 1999 (File                No. 0-19217)     |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.49  |   | Sydney                Engel Associates Second Amended and Restated Agreement of Limited                Partnership                                                                                   |   | Exhibit                10.4 to Form 10-Q Report dated                September                29, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.50  |   | First                Amendment to Second Amended and Restated Agreement of Limited Partnership                of Sydney Engel Associates                                                             |   | Exhibit                10.49 to Form 10-K Report dated                March                30, 1997 (File                No. 0-19217)     |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.51  |   | Second                Amendment to Second Amended and Restated Agreement of Limited Partnership                of Sydney Engel Associates L.P.                                                       |   | Exhibit                10.50 to Form 10-K Report dated                March                30, 1997 (File                No. 0-19217)     |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.52  |   | Third                Amendment to Second Amended and Restated Agreement of Limited Partnership                of Sydney Engel Associates L.P.                                                        |   | Exhibit                10.51 to Form 10-K Report dated                March                30, 1997 (File                No. 0-19217)     |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.53  |   | Fourth                Amendment to Second Amended and Restated Agreement of Limited Partnership                of Sydney Engel Associates L.P.                                                       |   | Exhibit                10.52 to Form 10-K Report dated                March                30, 1997 (File                No. 0-19217)     |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.54  |   | Union                Valley Associates Limited Partnership Amended and Restated Agreement                and                Certificate of Limited Partnership                                       |   | Exhibit                10.14 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.55  |   | Walnut                Grove Family, L.P. (A Mississippi Limited Partnership) Amended and                Restated Limited Partnership Agreement and Certificate of Limited                Partnership |   | Exhibit                10.4 to Form 10-Q Report dated                September                29, 1991 (File                No. 0-19217)  |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.56  |   | Waynesboro                Apartments Limited Partnership Amended and Restated Agreement and                Certificate of Limited Partnership                                                        |   | Exhibit                10.15 to Form 10-Q Report dated                December                30, 1990 (File                No. 33-31390) |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.57  |   | West                Calhoun City, L.P. (A Mississippi Limited Partnership) Amended and                Restated Limited Partnership Agreement and Certificate of Limited                Partnership   |   | Exhibit                10.5 to Form 10-Q Report dated                September                29, 1991 (File                No. 0-19217)  |
|   |   |                                                                                                                                                                                                 |   |                                                                                                                                      |
| 10.58  |   | Westminster                Apartments Limited Partnership Second Amended and Restated Agreement                of                Limited Partnership                                                 |   | Exhibit                10.53 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)    |

----

|   |   | Exhibit                                                                                                                                                                                                               |   | Incorporated                  by Reference                  to                            |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------|
| *31.1  |   | Rule                13a-14(a)/15d-14(a) Certification of Chief Executive                Officer                                                                                                                       |   |                                                                                                                                   |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| *31.2  |   | Rule                13a-14(a)/15d-14(a) Certification of Chief Financial                Officer.                                                                                                                      |   |                                                                                                                                   |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| *32.1  |   | Section                1350 Certification of Chief Executive Officer.                                                                                                                                                 |   |                                                                                                                                   |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| *32.2  |   | Section                1350 Certification of Chief Financial Officer.                                                                                                                                                 |   |                                                                                                                                   |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.1   |   | Pages                20 through 31, 44 through 71 and 78 through 80 of Prospectus filed                pursuant to Rule 424(b)(3) under Securities Act of 1933                                                        |   | Exhibit                28.0 to Form 10-K Report dated                March                30, 1990 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.2   |   | Pages                14 through 19 of Prospectus filed pursuant to Rule 424(b)(3) under                Securities Act of 1933                                                                                         |   | Exhibit                28.1 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.3   |   | Supplement                No. 1 dated June 6, 1990 to Prospectus                                                                                                                                                      |   | Exhibit                28.2 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.4   |   | Supplement                No. 2 dated November 21, 1990 to Prospectus                                                                                                                                                 |   | Exhibit                28.3 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.5   |   | Supplement                No. 3 dated December 20, 1990 to Prospectus                                                                                                                                                 |   | Exhibit                28.4 to Form 10-K Report dated                March                30, 1991 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.6   |   | Supplement                No. 4 dated October 30, 1991 to Prospectus                                                                                                                                                  |   | Exhibit                28.5 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.7   |   | Supplement                No. 5 dated December 26, 1991 to Prospectus                                                                                                                                                 |   | Exhibit                28.6 to Form 10-K Report dated                March                30, 1992 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.8   |   | Supplement                No. 6 dated January 15, 1992 to Prospectus                                                                                                                                                  |   | Exhibit                28.7 to Form 10-K Report dated                March                30, 1990 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.9   |   | Report                  of Independent Registered Public Accounting Firm of Carrington                  L.D.H.A.                  Limited Partnership as of and for the year ended December 31,                  2004 |   | Exhibit                99.9 to Form 10-K Report dated                March                30, 2005 (File                No. 33-31390)  |
|   |   |                                                                                                                                                                                                                  |   |                                                                                                                                   |
| 99.10  |   | Independent                Auditor’s Report of Ellinwood Heights Apartments, L.P. as of and for the                years ended December 31, 2004 and 2003                                                       |   | Exhibit                99.10 to Form 10-K Report dated                March                30, 2005 (File                No. 33-31390) |

----

|   |   | Exhibit                                                                                                                                                                                                                                                       |   | Incorporated                    by Reference to                                                                             |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------|
| 99.11  |   | Independent                  Auditors’ Report of NP-89 Limited Dividend Housing Association Limited                  Partnership as of and for the year ended December 31, 2004                                                                         |   | Exhibit                  99.11 to Form 10-K Reportdated                  March 30, 2005(File                  No. 33-31390) |
|   |   |                                                                                                                                                                                                                                                          |   |                                                                                                                        |
| 99.12  |   | Audited                  Financial Statements of NP-89 Limited Dividend Housing Association                  Limited                  Partnership as of and for the year ended December 31, 2005                                                              |   | Exhibit                  99.12 to Form 10-K Reportdated                  March 30, 2006(File                  No. 33-31390) |
|   |   |                                                                                                                                                                                                                                                          |   |                                                                                                                        |
| 99.13  |   | Report                  of Independent Registered Public Accounting Firm of NP-89 Limited                  Dividend                  Housing Association Limited Partnership as of and for the year                  ended                  December 31, 2005 |   | Exhibit                  99.13 to Form 10-K Reportdated                  March 30, 2006(File                  No. 33-31390) |
|   |   |                                                                                                                                                                                                                                                          |   |                                                                                                                        |
| *99.14 |   | Audited                  Financial Statements of NP-89 Limited Dividend Housing Association                  Limited                  Partnership as of and for the year ended December 31, 2006                                                              |   |                                                                                                                        |

**(b)      **
**Exhibits**

**(c)      **
**Financial      Statement Schedules**

----

**SIGNATURES**

|                                            |                                                       |                                                         |
|-------------------------------------------------|------------------------------------------------------------|--------------------------------------------------------------|
|                                            | **AMERICAN                TAX CREDIT PROPERTIES III L.P.** |
|                                            | (a Delaware limited partnership)                           |
|                                       |                                                  |                                                    |
|                                            | By:                                              | Richman Tax Credit Properties III L.P.,General Partner       |
|                                            |                                                       |                                                         |
|                                            | By:                                              | Richman Housing Credits Inc., general                partner |
|                                            |                                                       |                                                         |
|                                            |                                                       |                                                         |
| Dated:              March              14, 2008 |                                                            | /s/              David Salzman                               |
|                                            | David              Salzman                                 |
|                                            | Chief              Executive Officer                       |

|                                                |          |                           |
|-----------------------------------------------------|--------------------------------------------------|--------------------------------|
|                                                |                                             |                           |
| Dated:                March                14, 2008 |                                                  | /s/                Neal Ludeke |
|                                                | Neal                Ludeke                       |
|                                                | Chief                Financial Officer           |

| Signature                                     |   | Title                                                 |   | Date                          |
|-----------------------------------------------|--------|-------------------------------------------------------|--------|-------------------------------|
|                                          |   |                                                  |   |                          |
|                                          |   |                                                  |   |                          |
| /s/                David Salzman         |   | Chief                Executive Officer of the general |   | March                14, 2008 |
| (David                Salzman)                |   | partner                of the General Partner         |   |                          |
|                                          |   |                                                  |   |                          |
|                                          |   |                                                  |   |                          |
| /s/                Neal Ludeke           |   | Chief                Financial Officer of the general |   | March                14, 2008 |
| (Neal                Ludeke)                  |   | partner                of the General Partner         |   |                          |
|                                          |   |                                                  |   |                          |
|                                          |   |                                                  |   |                          |
| /s/                Richard Paul Richman  |   | Director                of the general partner of the |   | March                14, 2008 |
| (Richard                Paul Richman)         |   | General                Partner                        |   |                          |

----