UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-K


(Mark
One)


x ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d)


OF THE
SECURITIES EXCHANGE ACT OF 1934


For the
fiscal year ended March 30,
2009





OR





 ̈TRANSITION REPORT PURSUANT
TO SECTION 13 OR 15(d)


OF THE
SECURITIES EXCHANGE ACT OF 1934


For the
transition period from _________ to _________





0-19217





(Commission
File Number)





American Tax Credit
Properties III L.P.


(Exact
Name of Registrant as Specified in its Governing Instruments)





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) 869-0900Securities
      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)





Indicate by check mark if the
registrant is a well-known seasoned issuer, as defined in Rule 405 of the
Securities Act.  Yes ̈Nox





Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Act.  Yes  ̈  No
x





Indicate
by check mark whether the Registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the Registrant was required
to file such reports), and (2) has been subject to such filing requirement for
the past 90 days.  Yes   x  No
 ̈





Indicate
by check mark whether the Registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
Registrant was required to submit and post such
files).  Yes   ̈   No   ̈





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





Indicate
by check mark whether the Registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting
company.  See the definitions of “accelerated filer,” large
accelerated filer and smaller reporting company” in Rule 12b-2 of the Exchange
Act.





Large
Accelerated Filer   ̈  Accelerated
Filer   ̈  Non-Accelerated
Filer   ̈
Smaller Reporting Company  x





Indicate
by check mark whether the Registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  Yes  ̈  No
x





Registrant
has no voting common equity.  There is no established public trading
market for Registrant’s Units.  Accordingly, accurate information as
to the market value of a Unit at any given date is not available.





Documents
incorporated by reference:


Pages 14
through 19, 20 through 31, 44 through 71 and 78 through 80 of the Registrant’s
prospectus dated February 7, 1990, as supplemented by Supplement No. 1,
Supplement No. 2, Supplement No. 3, Supplement No. 4, Supplement No. 5 and
Supplement No. 6 dated June 6, 1990, November 21, 1990, December 20, 1990,
October 30, 1991, December 26, 1991 and January 15, 1992, respectively, filed
pursuant to Rule 424(b)(3) under the Securities Act of 1933, and filed as
Exhibits hereto, are incorporated by reference into Part I of this Annual
Report.





.PART I





Item
      1.
            Business.





General Development of
Business and Narrative Description of Business





American
Tax Credit Properties III L.P. (the "Registrant"), a Delaware limited
partnership, was formed on September 21, 1989 to invest primarily in leveraged
low-income multifamily residential complexes (the “Property” or “Properties”)
that qualified for the low-income tax credit in accordance with Section 42 of
the Internal Revenue Code (the "Low-income Tax Credit"), through the acquisition
of limited partner equity interests (the “Local Partnership Interests”) in
partnerships (the "Local Partnership" or "Local Partnerships") that are the
owners of the Properties.  The Local Partnerships hold their
respective Properties in fee.  Registrant considers its activity to
constitute a single industry segment.





Richman
Tax Credit Properties III L.P. (the "General Partner"), a Delaware limited
partnership, was formed on September 21, 1989 to act as the General Partner of
Registrant.  The general partner of the General Partner is Richman
Housing Credits Inc. ("Richman Housing"), a Delaware corporation that is wholly
owned by Richard Paul Richman.  Richman Housing is an affiliate of The
Richman Group, Inc. ("Richman Group"), a Delaware corporation founded by Richard
Paul Richman in 1988.





The
Amendment No. 2 to the Registration Statement on Form S-11 was filed with the
Securities and Exchange Commission (the "SEC") on February 1, 1990 pursuant to
the Securities Act of 1933 under Registration Statement File No. 33-31390 and
was declared effective on February 2, 1990.  Reference is made to the
prospectus dated February 7, 1990, as supplemented by Supplement No. 1,
Supplement No. 2, Supplement No. 3, Supplement No. 4, Supplement No. 5 and
Supplement No. 6 dated June 6, 1990, November 21, 1990, December 20, 1990,
October 30, 1991, December 26, 1991 and January 15, 1992, respectively, filed
with the SEC pursuant to Rule 424(b)(3) under the Securities Act of 1933 (the
"Prospectus").  Pursuant to Rule 12b-23 of the SEC's General Rules and
Regulations promulgated under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), the description of Registrant's business set forth under
the heading "Investment Objectives and Policies" at pages 44 through 66 of the
Prospectus is hereby incorporated into this Annual Report by
reference.





On March
12, 1990, Registrant commenced, through Merrill Lynch, Pierce, Fenner &
Smith Incorporated (“Merrill Lynch”), the offering of up to 150,000 units of
limited partnership interest (the "Units") at $1,000 per Unit to investors (the
“Limited Partners”).  On June 13, 1990, December 27, 1990, December
31, 1991 and January 23, 1992 the closings for 19,730, 9,622, 5,227 and 1,304
Units, respectively, took place, amounting to aggregate Limited Partners’
capital contributions of $35,883,000.





Registrant's
primary objective, to provide Low-income Tax Credits to the Limited Partners,
has been completed.  The relevant state tax credit agency allocated
each of the Local Partnerships an amount of Low-income Tax Credits, which are
generally available for a ten year period from the year the Property is placed
in service (the “Ten Year Credit Period”).  The Ten Year Credit Period
was fully exhausted with respect to all of the Properties as of December 31,
2003.  The required holding period of each Property, in order to avoid
Low-income Tax Credit recapture, is fifteen years from the year in which the
Low-income Tax Credits commence on the last building of the Property (the
"Compliance Period").  The Compliance Period of all of the Local
Partnerships had expired as of December 31, 2007.  In addition,
certain of the Local Partnerships entered into agreements with the relevant
state tax credit agencies whereby the Local Partnerships must maintain the
low-income nature of the Properties for a period which exceeds the Compliance
Period (in certain circumstances, up to 50 years from when the Property is
placed in service, but commonly 30 years from the date any such Property is
placed in service), regardless of a sale of the Properties by the Local
Partnerships after the Compliance Period (the “Extended Use
Provisions”).  Note that the existence of Extended Use Provisions does
not extend the Compliance Period of the respective Local
Partnerships.  However, such provisions may limit the number and
availability of potential purchasers of the Properties.  Accordingly,
a sale of a Property may happen well after the expiration of the Compliance
Period and/or may be significantly discounted.





Disposal of Local
Partnership Interests





Registrant
is in the process of disposing of its Local Partnership Interests.  As
of March 30, 2009, Registrant owns forty-one of the forty-three Local
Partnership Interests originally acquired.  Registrant has served a
demand on the local general partners (the “Local General Partners”) of all
remaining Local Partnerships to commence a sale process to dispose of the
Properties.  In the event a sale cannot be consummated, it is the
General Partner’s intention to sell or assign Registrant’s Local Partnership
Interests.  Following the final disposition of its Local Partnership
Interests, Registrant intends to dissolve and does not intend to conduct any
business.  It is uncertain as to the amount, if any, that Registrant
will receive with respect to each specific Property from such sales or
assignments. There can be no assurance as to when Registrant will dispose of its
remaining Local Partnership Interests.


2


Item
1.    Business
(continued).





Financial Information About
Industry Segments





Registrant
is engaged solely in the business of owning a Local Partnership Interest in each
of the Local Partnerships.  A presentation of information regarding
industry segments is not applicable and would not be material to an
understanding of Registrant’s business taken as a whole.  See Item 8
below for a summary of Registrant's operations.





Competition





Pursuant
to Rule 12b-23 of the SEC's General Rules and Regulations promulgated under the
Exchange Act, the description of Registrant's competition, general risks, tax
risks and partnership risks set forth under the heading "Risk Factors" at pages
20 through 31 of the Prospectus is hereby incorporated into this Annual Report
by reference.





Employees of
Registrant





Registrant
employs no personnel and incurs no payroll costs.  All management
activities of Registrant are conducted by the General Partner.  An
affiliate of the General Partner employs individuals who perform the management
activities of Registrant.  This entity also performs similar services
for other affiliates of the General Partner.





Regulation





The
following is a brief summary of certain regulations applicable to Registrant and
is not, nor should it be considered, a full summary of the law or all related
issues.  Other than as set forth above and below, Registrant is not
aware of any existing or probable federal, state or local governmental
regulations, or any recent changes to such governmental regulations, which would
have an effect on Registrant’s business.





Virtually
all of the Properties owned by the Local Partnerships have some form of a
government funded rental subsidy that affords the low-income tenants the ability
to reside at the Properties.  During the period that a subsidy
agreement between the United States Department of Housing and Urban Development
(“HUD”) and a Local Partnership is in existence, the Local Partnership Interest
of such Local Partnership may not be sold, and the Property may not be
transferred by the Local Partnership to another entity, without HUD’s approval,
which may be subject to various conditions.  In particular, the
transfer of title of the Properties by the Local Partnerships is expected to be
required to be closed in escrow pending HUD approval.  In addition, as
a condition to certain disposals, Registrant anticipates that HUD will require
the Local Partnerships to dedicate resources to maintenance in order to correct
deficiencies in the physical condition of the Properties. Correction of such
deficiencies will probably require expenditures of significant amounts of funds,
thus effectively reducing the amount of any net proceeds from the sale of the
Property.  There can be no assurance that the required governmental
agencies will approve any of the requested transfers, that such approvals will
be received in a timely manner or that other conditions will not be imposed for
such approvals. The failure to obtain or a delay in obtaining any required
approvals would have adverse consequences to the Limited Partners.





In the
case of certain of the Local Partnerships, the local housing authority has the
right, for a period of time, to find a purchaser for the Property prior to the
Local General Partner beginning its own efforts to sell the
Property.  There can be no assurance that the local housing
authorities will be successful in finding purchasers for such Properties, which
may adversely impact the timing of Property sales.





Certain
of the Local Partnerships may be subject to restrictions on the amount of annual
cash distributions to partners under the terms of such Local Partnerships’ loan,
regulatory or other agreements.





Registrant
is not aware of any non-compliance by the Local Partnerships with respect to
federal, state and local provisions regulating the discharge of material into
the environment or otherwise relating to the protection of the environment, and
is not aware of any condition that would have a material effect on the capital
expenditures or competitive position of Registrant.


3


Item
1A.  Risk
Factors.





Risks Relating to
Registrant’s Business and Industry





There
is no guarantee that the Properties will be sold or, if sold, that Registrant
would receive any proceeds.





As noted
above in Item 1 - Business, Registrant
has served a demand on the Local General Partners of all remaining Local
Partnerships to commence a sale process to dispose of the
Properties.  However, the market of interested buyers of the
Properties is limited.  Some of the factors which negatively impact
the marketability of the Properties, or equivalently, the Local Partnership
Interests, include:





·
            the
      Extended Use Provisions;





·
            the
      substantial remaining mortgage balances on the Properties, which are
      typically very near the initial balances as a result of the heavily
      subsidized debt of the Local Partnership and the lengthy (usually near
      40-year) amortization period of the debt;
and





·
            poor
      economic conditions.





It is
generally expected, therefore, that in the event a sale of a Property by a Local
Partnership can be consummated, the net proceeds of such sale, after repayment
of any outstanding debt and other liabilities, are not likely to be
significant.  Moreover, a portion of the net proceeds from the sale of
a Property by a Local Partnership may be payable to the Local General Partner
for prior operating advances and deferred fees.  As such, there will
likely not be significant proceeds, if any, upon a sale of a Property that will
be available for distribution by the Local Partnership to
Registrant.  In the event a sale cannot be consummated, it is the
General Partner’s intention to sell or assign Registrant’s Local Partnership
Interests.  However, it is not possible to ascertain the amount, if
any, that Registrant will receive with respect to each specific Property from
such sales or assignments.





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.





As noted
above in Item 1 - Business, certain of
the Local Partnerships entered into agreements containing Extended Use
Provisions with the relevant state tax credit agencies whereby the Local
Partnerships must maintain the low-income nature of the Properties for a period
which exceeds the Compliance Period (in certain circumstances, up to 50 years
from when the Property is placed in service, but commonly 30 years from the date
any such Property is placed in service), regardless of a sale of the Properties
by the Local Partnerships after the Compliance Period.  Although the
Extended Use Provisions do not extend the Compliance Period of the respective
Local Partnerships, such provisions may limit the number and availability of
potential purchasers of the Properties.  Accordingly, a sale of a
Property may happen well after the expiration of the Compliance Period and/or
may be significantly discounted.





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.





Registrant’s
investment in the Local Partnerships is subject to the risks associated with
multi-family rental property and real estate in general, including retail,
commercial and residential real estate.  Such risks, which are subject
to change and are not in the control of Registrant, include risks related
to:




·
            the
      adverse use of adjacent or neighborhood real
  estate;




·
            regulated
      rents, which may adversely impact rent
  increases;




·
            utility
      allowances, which may adversely impact rents charged to tenants from year
      to year in certain locations;




·
            the
      inability of tenants to pay rent in light of current market
      conditions;




·
            changes
      in the demand for or supply of competing
  properties;




·
            changes
      in state or local tax rates and
assessments;


4


Item
1A.  Risk
Factors (continued).




·
            increases
      in utility charges;




·
            unexpected
      expenditures for repairs and
maintenance;




·
            the
      discovery of previously undetected environmentally hazardous
      conditions;




·
            costs
      associated with complying with the Americans with Disabilities
      Act;




·
            uninsured
      losses relating to real property or excessively expensive premiums for
      insurance coverage;




·
            lawsuits
      from tenants or guests in connection with injuries that occur on the
      Properties;




·
            changes
      in local economic conditions; and




·
            changes
      in interest rates and the availability of financing (including changes
      resulting from current market
conditions).




The
occurrence of any of the above risks could have a negative impact on the
operating results of such Properties and the respective Local Partnerships and,
in turn, may render the sale or refinancing of the Properties difficult or
unattractive, which could adversely affect Registrant’s investment in such Local
Partnerships.





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.





Virtually
all of the Properties owned by the Local Partnerships have some form of a
government funded rental subsidy, which affords the low-income tenants the
ability to reside at the Properties.  The Local Partnerships are
extremely reliant on such subsidies.  If the respective rental subsidy
programs were to be materially modified or eliminated, the Local Partnerships’
rental revenue would likely be significantly reduced.  To the extent
that revenues are not sufficient to meet operating expenses and service the
respective mortgages of the Properties, such Local Partnership would be required
to use reserves and any other funds available to avoid foreclosure of the
subject Property.  Registrant’s investments in the Local Partnerships
are highly leveraged, and there can be no assurance that additional funds would
be available to any Local Partnership or Registrant, if needed.  In
addition, there can be no assurance that, when a Property is sold, the proceeds
from a sale will be sufficient to pay the balance due on the mortgage loans or
any other outstanding indebtedness to which the Local Partnership is
subject.





Limited
Partners may not be able to use all of the carried forward Low-income Tax
Credits.





While a
limited exception is provided for Low-income Tax Credits in the case of
individuals, tax losses and credits allocated to a Limited Partner who is an
individual, trust, estate or personal service corporation generally may be used
to reduce the Limited Partner’s tax liability only to the extent that such
liability arises from passive activities.  Therefore, tax losses and
credits allocated to such a Limited Partner are not expected to be available to
offset tax liabilities that arise from salaries, dividends and interest and
other forms of income.  In addition, Low-income Tax Credits cannot be
used to offset alternative minimum tax.  Accordingly, there is no
guarantee that Limited Partners will be able to utilize all of the carried
forward Low-income Tax Credits.





Risks Relating to Ownership
of Units of Limited Partnership Interest of Registrant





There
is no existing market for the Units.





There is
no trading market for Units and there are no assurances that any market will
develop.  In addition, the Units may be transferred only if certain
requirements are satisfied, including requirements that such transfer would not
impair Registrant’s tax status for federal income tax purposes and would not be
a violation of federal or state securities laws.  Accordingly, Limited
Partners may not be able to sell their Units promptly and bear the economic risk
of their investment for an indefinite period of time.


5


Item
1A.  Risk
Factors (continued).





Under
certain circumstances, Limited Partners of Registrant may incur out-of-pocket
tax costs.





At some
point, Registrant’s operations (including the sale or refinancing of the
Properties owned by the Local Partnerships) may generate less cash flow than
taxable income, and the income, as well as the income taxes payable with respect
to Registrant’s taxable income, may exceed cash flow available for distribution
to the Limited Partners in such years.  This may result in an
out-of-pocket tax cost to the Limited Partners.  In addition, a
Limited Partner may experience taxable gain on disposition of Units or upon a
disposition of the Local Partnership Interests or of the Properties even though
no cash is realized on the disposition; in such circumstances, the Limited
Partners may experience an out-of-pocket tax cost.





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





To date,
the Limited Partners of Registrant have not received a return of any portion of
their original capital.  Accordingly, the only benefit of this
investment may be the Low-income Tax Credits.





Item
1B.  Unresolved Staff
Comments.





Not
applicable.





Item
2.    Properties.





The
executive offices of Registrant and the General Partner are located at 340
Pemberwick Road, Greenwich, Connecticut 06831. Registrant does not own or lease
any properties.  Registrant pays no rent; all charges for leased space
are borne by an affiliate of the General Partner.





Registrant
originally acquired Local Partnership Interests in forty-three Local
Partnerships.  As discussed above in Item 1 - Business,the Compliance
Period of all of the Local Partnerships expired as of December 31, 2007 and,
accordingly, Registrant is in the process of disposing of its Local Partnership
Interests.  As of March 30, 2009, Registrant owns forty-one of the
forty-three Local Partnership Interests originally
acquired.  Registrant has instructed the remaining Local Partnerships
to commence a sale process to dispose of the Properties, which Registrant
intends will result in a termination of Registrant’s Local Partnership Interests
and ultimately the dissolution of Registrant.





During
the year ended March 30, 2009, Registrant withdrew from Ashland Park Apartments,
L.P. (“Ashland Park”), in connection with which Registrant received
$3,500.  See further discussion regarding Ashland Park in Part II,
Item 7 - Management’s
Discussion and Analysis of Financial Condition and Results of Operations
herein.





In the
event a sale of the remaining Properties cannot be consummated, it is the
General Partner’s intention to sell or assign Registrant’s Local Partnerships
Interests.  It is not possible to ascertain the amount, if any, that
Registrant will receive with respect to each specific Property from such sales
or assignments.  In addition, certain of the Local Partnerships
entered into agreements with Extended Use Provisions with the relevant state tax
credit agencies whereby the Local Partnerships must maintain the low-income
nature of the Properties for a period which exceeds the Compliance Period (in
certain circumstances, up to 50 years from when the Property is placed in
service, but commonly 30 years from the date any such Property is placed in
service), regardless of a sale of the Properties by the Local Partnerships after
the Compliance Period.  While the Extended Use Provisions do not
extend the Compliance Period of the respective Local Partnerships, such
provisions may limit the number and availability of potential purchasers of the
Properties.  Accordingly, a sale of a Property may happen well after
the expiration of the Compliance Period and/or may be significantly
discounted.  There can be no assurance as to when the Local
Partnerships will dispose of the Properties, when Registrant will dispose of the
Local Partnership Interests or the amount of proceeds which may be received in
such dispositions.  In addition to amounts that remain outstanding under
the terms of the debt structure of the respective Local Partnerships, certain
Local Partnerships have outstanding obligations to the Local General Partners
and/or affiliates thereof for operating advances made over the years and for
certain fees that were deferred.


6


Item
2.    Properties
(continued).





The Local
Partnership Interests were acquired by Registrant from 1990 through
1992.  Although Registrant generally owns a 98.9%-99% Local
Partnership Interest in the Local Partnerships, Registrant and American Tax
Credit Properties II L.P. ("ATCP II"), a Delaware limited partnership whose
general partner is affiliated with the General Partner, together, in the
aggregate, own a 99% Local Partnership Interest in the following Local
Partnerships:





Registrant
                
                
                ATCP
      IIBatesville
      Family, L.P.
                
                
                61.75%
                
                
                
                37.25%Bruce
      Housing Associates, L.P.
                
                
                61.75
                
                
                
                37.25Ivy
      Family, L.P.
                
                
                61.75
                
                
                
                37.25Lawrence
      Road Properties, Ltd.
                
                
                61.75
                
                
                
                37.25Mirador
      del Toa Limited Partnership
                
                
                59.06
                
                
                
                39.94Purvis
      Heights Properties, L.P.
                
                
                61.75
                
                
                
                37.25Queen
      Lane Investors
                
                
                48.50
                
                
                
                50.50





Many of
the Local Partnerships receive rental subsidy payments, including payments under
Section 8 of Title II of the Housing and Community Development Act of 1974
("Section 8") (see descriptions of the subsidies below).  The subsidy
agreements expire at various times.  Since October 1997, HUD has
issued a series of directives related to project based Section 8 contracts that
define owners’ notification responsibilities, advise owners of project based
Section 8 properties of what their options are regarding the renewal of Section
8 contracts, provide guidance and procedures to owners, management agents,
contract administrators and HUD staff concerning renewal of Section 8 contracts,
provide policies and procedures on setting renewal rents and handling renewal
rent adjustments and provide the requirements and procedures for opting-out of a
Section 8 project based contract.  Registrant cannot reasonably
predict legislative initiatives and governmental budget negotiations, the
outcome of which could result in a reduction in funds available for the various
federal and state administered housing programs including the Section 8
program.  Such changes could adversely affect the future net operating
income before debt service (“NOI”) and debt structure of any or all Local
Partnerships currently receiving such subsidy or similar
subsidies.  Three Local Partnerships’ Section 8 contracts are
currently subject to renewal under applicable HUD guidelines.


7


Item
2.    Properties
(continued).





MortgageName
      of Local Partnership
                                        
                                        Number
                                        
                                        
                                        
                                        
                                        
                                        loans
      payable as of
                                        
                                        
                                        SubsidyName
      of apartment complex
                                        
                                        of
      rental
                                        
                                        
                                        Capital
                                        
                                        
                                        December
      31,
                                        
                                        
                                        (seeApartment
      complex location
                                        
                                        units
                                        
                                        
                                        contribution
                                        
                                        
                                        2008
                                        
                                        
                                        footnotes)April
      Gardens Apartments II
                                          Limited
      Partnership
                                          April
      Gardens Apartments
                                          Las
      Piedras, Puerto Rico
                                        
                                        
                                        48
                                        
                                        
                                        $
                                        485,581
                                        
                                        
                                        $
                                        1,930,431
                                        
                                        
                                        (1b&c)Ashland
      Park Apartments, L.P. (5)
                                          Ashland
      Park Apartments
                                          Ashland,
      Nebraska
                                        
                                        
                                        24
                                        
                                        
                                        
                                        235,732
                                        
                                        
                                        
                                        1,001,691Auburn
      Family, L.P.
                                          Auburn
      Apartments
                                          Louisville,
      Mississippi
                                        
                                        
                                        16
                                        
                                        
                                        
                                        95,412
                                        
                                        
                                        
                                        438,806
                                        
                                        
                                        (1b&c)Batesville
      Family, L.P.
                                          Westridge
      Apartments
                                          Batesville,
      Mississippi
                                        
                                        
                                        48
                                        
                                        
                                        
                                        239,716
                                        (2)
                                        
                                        
                                        1,396,285
                                        
                                        
                                        
                                        (1b)Bay
      Springs Elderly, L.P.
                                          Bay
      Springs Manor
                                          Bay
      Springs, Mississippi
                                        
                                        
                                        24
                                        
                                        
                                        
                                        208,820
                                        
                                        
                                        
                                        654,239
                                        
                                        
                                        (1b&c)Brisas
      del Mar Apartments
                                          Limited
      Partnership
                                          Brisas
      del Mar Apartments
                                          Hatillo,
      Puerto Rico
                                        
                                        
                                        66
                                        
                                        
                                        
                                        668,172
                                        
                                        
                                        
                                        2,556,919
                                        
                                        
                                        (1b&c)Bruce
      Housing Associates, L.P.
                                          Bruce
      Family Apartments
                                          Bruce,
      Mississippi
                                        
                                        
                                        40
                                        
                                        
                                        
                                        183,155
                                        (2)
                                        
                                        
                                        1,064,826
                                        
                                        
                                        (1b&c)Carrington
      Limited Dividend
                                          Housing
      Association Limited
                                          Partnership
      (3), (4)
                                          Carrington
      Place
                                          Farmington
      Hills, Michigan
                                        
                                        
                                        100
                                        
                                        
                                        
                                        2,174,720
                                        (2)
                                        
                                        
                                        —
                                        (3)Chestnut
      Park Associates, L.P.
                                          Chestnut
      Park Apartments
                                          East
      Orange, New Jersey
                                        
                                        
                                        59
                                        
                                        
                                        
                                        4,204,576
                                        
                                        
                                        
                                        4,337,275
                                        
                                        
                                        (1a&g)Chowan
      Senior Manor Associates
                                          Limited
      Partnership
                                          Azalea
      Garden Senior Manor
                                          Apartments
                                          Murfreesboro,
      North Carolina
                                        
                                        
                                        33
                                        
                                        
                                        
                                        278,405
                                        
                                        
                                        
                                        1,194,083
                                        
                                        
                                        (1b&c)Christian
      Street Commons
                                          Associates
                                          Christian
      Street Commons
                                          Apartments
                                          Philadelphia,
      Pennsylvania
                                        
                                        
                                        18
                                        
                                        
                                        
                                        581,645
                                        
                                        
                                        
                                        521,832
                                        
                                        
                                        
                                        (1b)


8


Item
2.    Properties
(continued).





MortgageName
      of Local Partnership
                                        
                                        Number
                                        
                                        
                                        
                                        
                                        
                                        loans
      payable as of
                                        
                                        
                                        SubsidyName
      of apartment complex
                                        
                                        of
      rental
                                        
                                        
                                        Capital
                                        
                                        
                                        December
      31,
                                        
                                        
                                        (seeApartment
      complex location
                                        
                                        units
                                        
                                        
                                        contribution
                                        
                                        
                                        2008
                                        
                                        
                                        footnotes)Country
      View Apartments
                                          Country
      View Apartments
                                          Pembroke,
      Maine
                                        
                                        
                                        16
                                        
                                        
                                        $
                                        279,183
                                        
                                        
                                        $
                                        905,761
                                        
                                        
                                        (1b&c)Desarrollos
      de Belen Limited
                                          Partnership
                                          Vista
      de Jagueyes II Apartments
                                          Aguas
      Buenas, Puerto Rico
                                        
                                        
                                        41
                                        
                                        
                                        
                                        422,929
                                        
                                        
                                        
                                        1,817,596
                                        
                                        
                                        (1b&c)Desarrollos
      de Emaus Limited
                                          Partnership
                                          Hucares
      II Apartments
                                          Naguabo,
      Puerto Rico
                                        
                                        
                                        72
                                        
                                        
                                        
                                        631,404
                                        
                                        
                                        
                                        3,089,078
                                        
                                        
                                        (1b&c)Ellinwood
      Heights Apartments, L.P.
                                          Ellinwood
      Heights Apartments
                                          Ellinwood,
      Kansas
                                        
                                        
                                        24
                                        
                                        
                                        
                                        156,261
                                        
                                        
                                        
                                        664,920
                                        
                                        
                                        (1b&c)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
                                        
                                        
                                        
                                        1,378,596
                                        
                                        
                                        (1b&c)Howard
      L. Miller Sallisaw
                                          Apartments
      II, L.P.
                                          Sallisaw
      II Apartments
                                          Sallisaw,
      Oklahoma
                                        
                                        
                                        24
                                        
                                        
                                        
                                        130,158
                                        
                                        
                                        
                                        596,258
                                        
                                        
                                        (1b&c)Hurlock
      Meadow Limited
                                          Partnership
                                          Hurlock
      Meadow Apartments
                                          Hurlock,
      Maryland
                                        
                                        
                                        30
                                        
                                        
                                        
                                        284,218
                                        
                                        
                                        
                                        1,225,472
                                        
                                        
                                        (1b&c)Ivy
      Family, L.P.
                                          Ivy
      Apartments
                                          Louisville,
      Mississippi
                                        
                                        
                                        32
                                        
                                        
                                        
                                        135,528
                                        (2)
                                        
                                        
                                        731,946
                                        
                                        
                                        (1b&c)Justin
      Associates
                                          Locust
      Tower Apartments
                                          Philadelphia,
      Pennsylvania
                                        
                                        
                                        40
                                        
                                        
                                        
                                        1,809,723
                                        
                                        
                                        
                                        2,084,848
                                        
                                        
                                        (1a,b&g)LaBelle
      Commons, Ltd.
                                          LaBelle
      Commons
                                          LaBelle,
      Florida
                                        
                                        
                                        32
                                        
                                        
                                        
                                        253,580
                                        
                                        
                                        
                                        978,339
                                        
                                        
                                        (1b&c)Lawrence
      Road Properties, Ltd.
                                          Hillcrest
      Apartments
                                          Newton,
      Mississippi
                                        
                                        
                                        24
                                        
                                        
                                        
                                        123,799
                                        (2)
                                        
                                        
                                        733,946
                                        
                                        
                                        (1b&c)


9


Item
2.    Properties
(continued).





MortgageName
      of Local Partnership
                                          
                                          Number
                                          
                                          
                                          
                                          
                                          
                                          loans
      payable as of
                                          
                                          
                                          SubsidyName
      of apartment complex
                                          
                                          of
      rental
                                          
                                          
                                          Capital
                                          
                                          
                                          December
      31,
                                          
                                          
                                          (seeApartment
      complex location
                                          
                                          units
                                          
                                          
                                          contribution
                                          
                                          
                                          2008
                                          
                                          
                                          footnotes)Loma
      Del Norte Limited
                                            Partnership
                                            Loma
      Del Norte Apartments
                                            Anthony,
      New Mexico
                                          
                                          
                                          40
                                          
                                          
                                          $
                                          314,865
                                          
                                          
                                          $
                                          1,391,814
                                          
                                          
                                          (1b&c)Long
      Reach Associates Limited
                                            Partnership
                                            Oak
      Ridge Apartments
                                            Bath,
      Maine
                                          
                                          
                                          30
                                          
                                          
                                          
                                          448,922
                                          
                                          
                                          
                                          1,431,058
                                          
                                          
                                          (1b&c)Mirador
      del Toa Limited
                                            Partnership
                                            Mirador
      del Toa Apartments
                                            Toa
      Alta, Puerto Rico
                                          
                                          
                                          48
                                          
                                          
                                          
                                          284,847
                                          (2)
                                          
                                          
                                          1,811,472
                                          
                                          
                                          (1b&c)Moore
      Haven Commons, Ltd.
                                            Moore
      Haven Commons
                                            Moore
      Haven, Florida
                                          
                                          
                                          28
                                          
                                          
                                          
                                          213,402
                                          
                                          
                                          
                                          896,963
                                          
                                          
                                          (1b&c)NP-89
      Limited Dividend Housing
                                            Association
      Limited Partnership
                                            Newport
      Apartments
                                            Clinton
      Township, Michigan
                                          
                                          
                                          168
                                          
                                          
                                          
                                          2,372,292
                                          
                                          
                                          
                                          2,895,016
                                          
                                          
                                          (1a,b&g)Nash
      Hill Associates, Limited
                                            Partnership
                                            Nash
      Hill Place
                                            Williamsburg,
      Massachusetts
                                          
                                          
                                          28
                                          
                                          
                                          
                                          302,575
                                          
                                          
                                          
                                          1,419,789
                                          
                                          
                                          (1b,c&e)North
      Calhoun City, L.P.
                                            North
      Calhoun City Apartments
                                            Calhoun
      City, Mississippi
                                          
                                          
                                          18
                                          
                                          
                                          
                                          146,565
                                          
                                          
                                          
                                          448,576
                                          
                                          
                                          (1b&c)Orange
      City Plaza, Limited
                                            Partnership
      (6)
                                            Orange
      City Plaza Apartments
                                            Orange
      City, Iowa
                                          
                                          
                                          32
                                          
                                          
                                          
                                          576,472
                                          
                                          
                                          
                                          372,119
                                          
                                          
                                          
                                          (1f)Puerta
      del Mar Limited Partnership
                                            Puerta
      del Mar Apartments
                                            Hatillo,
      Puerto Rico
                                          
                                          
                                          66
                                          
                                          
                                          
                                          630,570
                                          
                                          
                                          
                                          2,433,052
                                          
                                          
                                          (1b&c)Purvis
      Heights Properties, L.P.
                                            Pineview
      Apartments
                                            Purvis,
      Mississippi
                                          
                                          
                                          40
                                          
                                          
                                          
                                          191,512
                                          (2)
                                          
                                          
                                          1,110,322
                                          
                                          
                                          
                                          (1b)Queen
      Lane Investors
                                            Queen's
      Row
                                            Philadelphia,
      Pennsylvania
                                          
                                          
                                          29
                                          
                                          
                                          
                                          597,050
                                          (2)
                                          
                                          
                                          1,884,424
                                          
                                          
                                          
                                          (1b)Somerset
      Manor, Ltd.
                                            Somerset
      Manor
                                            Central
      City, Pennsylvania
                                          
                                          
                                          24
                                          
                                          
                                          
                                          208,465
                                          
                                          
                                          
                                          868,979
                                          
                                          
                                          (1b&c)Sugar
      Cane Villas, Ltd.
                                            Sugar
      Cane Villas
                                            Pahokee,
      Florida
                                          
                                          
                                          87
                                          
                                          
                                          
                                          751,560
                                          
                                          
                                          
                                          3,200,620
                                          
                                          
                                          (1b&c)


10


Item
2.    Properties
(continued).





MortgageName
      of Local Partnership
                              
                              Number
                              
                              
                              
                              
                              
                              loans
      payable as of
                              
                              
                              SubsidyName
      of apartment complex
                              
                              of
      rental
                              
                              
                              Capital
                              
                              
                              December
      31,
                              
                              
                              (seeApartment
      complex location
                              
                              units
                              
                              
                              contribution
                              
                              
                              2008
                              
                              
                              footnotes)Summerfield
      Apartments Limited
                                Partnership
                                Summerfield
      Apartments
                                Charlotte,
      North Carolina
                              
                              
                              52
                              
                              
                              $
                              1,088,667
                              
                              
                              $
                              1,441,951
                              
                              
                              
                              (1b)Sydney
      Engel Associates L.P.
                                (formerly
      known as Sydney Engel
                                Associates)
                                The
      Castle
                                New
      York, New York
                              
                              
                              224
                              
                              
                              
                              3,201,874
                              
                              
                              
                              15,270,199
                              
                              
                              
                              (1b)Union
      Valley Associates Limited
                                Partnership
                                Union
      Valley Apartments
                                Union
      Township, Pennsylvania
                              
                              
                              36
                              
                              
                              
                              371,589
                              
                              
                              
                              1,400,527
                              
                              
                              
                              (1b)Walnut
      Grove Family, L.P.
                                Walnut
      Grove Apartments
                                Walnut
      Grove, Mississippi
                              
                              
                              24
                              
                              
                              
                              191,695
                              
                              
                              
                              821,643
                              
                              
                              (1b&c)Waynesboro
      Apartments Limited
                                Partnership
                                Waynesboro
      Apartments
                                Waynesboro,
      Pennsylvania
                              
                              
                              36
                              
                              
                              
                              360,859
                              
                              
                              
                              1,431,989
                              
                              
                              
                              (1b)West
      Calhoun City, L.P.
                                West
      Calhoun City Apartments
                                Calhoun
      City, Mississippi
                              
                              
                              28
                              
                              
                              
                              230,212
                              
                              
                              
                              672,387
                              
                              
                              (1b&c)Westminster
      Apartments Limited
                                Partnership
                                Westminster
      Apartments
                                Philadelphia,
      Pennsylvania
                              
                              
                              42
                              
                              
                              
                              1,047,993
                              
                              
                              
                              1,607,972
                              
                              
                              (1b&d)$
                              29,384,966
                              
                              
                              $
                              75,984,949





(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
      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.





(d)
            The
      City of Philadelphia Housing Authority allows qualified low-income tenants
      to receive rental certificates.





(e)
            The
      Commonwealth of Massachusetts participates in a rental assistance
      program.





(f)
            The
      Northwest Regional Housing Authority provides qualified tenants with a
      rental subsidy.





(g)
            The
      Local Partnerships’ Section 8 contracts are currently subject to renewal
      under applicable HUD
guidelines.


11


Item
      2.
            Properties
      (continued).





(2)
            Reflects
      amount attributable to Registrant
only.





(3)
            The
      Local Partnership Interest is no longer owned by Registrant; there are no
      assets or liabilities related to such Local Partnership included in the
      combined balance sheets of the Local Partnerships as of December 31, 2008
      and 2007 in Note 5 to the accompanying financial
    statements.





(4)
            Registrant
      assigned its Local Partnership Interest to one of the Local General
      Partners in February 2007.  The combined statement of operations
      of the Local Partnerships for the year ended December 31, 2007 included in
      Note 5 to the accompanying financial statements does not include any
      results of operations for such Local Partnership (see Part II, Item 7 -
      Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations, herein).





(5)
            Registrant
      withdrew from the Local Partnership in February 2009 (see Part II, Item 7
      - Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations, herein).





(6)
            Capital
      contribution includes voluntary advances made to the Local
      Partnership.





Item
      3.
            Legal
      Proceedings.





None.





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





There
were no matters submitted to a vote of the Limited Partners during the fourth
quarter of the fiscal year covered by this report.


12


PART
II





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





Market Information and
Holders





There is
no established public trading market for the Units.  Accordingly,
accurate information as to the market value of a Unit at any given date is not
available.  The number of record holders of Units as of December 31,
2008 was approximately 1,415, holding an aggregate of 35,883 Units.





Merrill
Lynch follows internal guidelines for providing estimated values of limited
partnerships and other direct investments reported on client account
statements.  Pursuant to such guidelines, estimated values for limited
partnership interests reported on Merrill Lynch client account statements (such
as Registrant’s Units) are provided to Merrill Lynch by independent valuation
services, whose estimated values are based on financial and other information
available to them.  In addition, Registrant may provide an estimate of
value to Unit holders from time to time in Registrant's reports to Limited
Partners.  The estimated values provided by the independent services
and Registrant, which may differ, are not market values and Unit holders may not
be able to sell their Units or realize either amount upon a sale of their
Units.  Unit holders may not realize such estimated values upon the
liquidation of Registrant.





Distributions





Registrant
owns a Local Partnership Interest in Local Partnerships that are the owners of
Properties that are leveraged and receive government assistance in various forms
of rental and debt service subsidies.  The distribution of cash flow
generated by the Local Partnerships may be restricted, as determined by each
Local Partnership's financing and subsidy agreements.  Accordingly,
Registrant does not anticipate that it will provide significant cash
distributions to its Limited Partners in the future.  There were no
cash distributions to the Limited Partners during the years ended March 30, 2009
and 2008.





Low-income
Tax Credits, which are subject to various limitations, may be used by the
Limited Partners to offset federal income tax liabilities.  Registrant
generated total Low-income Tax Credits from investments in Local Partnerships of
approximately $1,559 per Unit.  The Ten Year Credit Period with
respect to the Properties was fully exhausted as of December 31, 2003 and the
Compliance Periods of the Local Partnerships had expired as of December 31,
2007.  Registrant has served a demand on the Local General Partners of
all remaining Local Partnerships to commence a sale process to dispose of the
Properties.  In the event a sale cannot be consummated, it is the
General Partner’s intention to sell or assign Registrant’s Local Partnership
Interests.  It is not possible to ascertain the amount, if any, that
Registrant will receive with respect to each specific Property from such sales
or assignments.





Recent Sales of Unregistered
Securities





None.





Item
      6.
            Selected Financial
      Data.





Not
applicable.





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





Capital Resources and
Liquidity





Registrant
admitted limited partners (the “Limited Partners”) in four closings with
aggregate Limited Partners’ capital contributions of $35,883,000.  In
connection with the offering of the sale of units (the “Units”), Registrant
incurred organization and offering costs of approximately $4,419,000 and
established a working capital reserve of approximately
$2,153,000.  The remaining net proceeds of approximately $29,311,000
(the “Net Proceeds”) were available to be applied to the acquisition of limited
partner interests (the “Local Partnership Interests”) in local partnerships (the
“Local Partnerships”) that own low-income multifamily residential complexes (the
“Property” or “Properties”) that qualified for the low-income tax credit in
accordance with Section 42 of the Internal Revenue Code (the “Low-income Tax
Credit”).  The Net Proceeds were utilized in acquiring a Local
Partnership Interest in forty-three Local Partnerships.


13


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





As of
March 30, 2009, Registrant has cash and cash equivalents of $946,612, which is
available for operating expenses of Registrant and circumstances which may arise
in connection with the Local Partnerships.  Future sources of
Registrant funds are expected to be primarily from interest earned on working
capital and limited cash distributions from Local Partnerships.  In
addition, although it is not possible to ascertain the amount, if any, that
Registrant will receive with respect to each specific Property, Registrant may
be entitled to sales proceeds of certain Local Partnerships’
Properties.  As of March 30, 2008, Registrant’s investments in bonds
represented U.S. Treasury debt securities of $870,596 that matured in May
2008.





During
the year ended March 30, 2009, Registrant received cash from interest revenue,
proceeds from maturities/redemptions and sales of bonds, proceeds in connection
with the disposal of limited partner interests/local partnership properties (see
discussion below under Local Partnership
Matters) and distributions from Local Partnerships and utilized cash for
operating expenses.  Cash and cash equivalents and investments in
bonds decreased, in the aggregate, by approximately $305,000 during the year
ended March 30, 2009, (which includes a net unrealized loss on investments in
bonds of approximately $3,000 and the accretion of zero coupon bonds of
approximately $5,000).





During
the year ended March 30, 2009, the investment in local partnerships increased as
a result of Registrant’s equity in the Local Partnerships’ net income for the
year ended December 31, 2008 of $25,363.  Accounts payable and accrued
expenses and payable to general partner and affiliates in the accompanying
balance sheet as of March 30, 2009 include cumulative deferred administration
fees and management fees of $3,375,392.





Results of
Operations





Registrant’s
operating results are dependent upon the operating results of the Local
Partnerships and are significantly impacted by the Local Partnerships’
policies.  In addition, the operating results herein are not
necessarily the same for tax reporting.  Registrant accounts for its
investment in local partnerships in accordance with the equity method of
accounting.  Accordingly, the investment is carried at cost and is
adjusted for Registrant’s share of each Local Partnership’s results of
operations and by cash distributions received.  Equity in loss of each
investment in Local Partnership allocated to Registrant is recognized to the
extent of Registrant’s investment balance in each Local
Partnership.  Equity in loss in excess of Registrant’s investment
balance in a Local Partnership is allocated to other partners’ capital in any
such Local Partnership.  As a result, the reported equity in loss of
investment in local partnerships is expected to decrease as Registrant's
investment balances in the respective Local Partnerships become zero. The
combined statements of operations of the Local Partnerships reflected in Note 5
to Registrant’s financial statements include the operating results of all Local
Partnerships, irrespective of Registrant’s investment balances.





Cumulative
losses and cash distributions in excess of investment in local partnerships may
result from a variety of circumstances, including a Local Partnership's
accounting policies, subsidy structure, debt structure and operating deficits,
among other things.  In addition, the book value of Registrant’s
investment in each Local Partnership (the “Local Partnership Carrying Value”)
may be reduced if the Local Partnership Carrying Value is considered to exceed
the estimated value derived by management.  Accordingly, cumulative
losses and cash distributions in excess of the investment or an adjustment to a
Local Partnership’s Carrying Value are not necessarily indicative of adverse
operating results of a Local Partnership.  See discussion below under
Local Partnership
Matters regarding certain Local Partnerships currently operating below
economic break even levels.





Registrant’s
operations for the years ended March 30, 2009, 2008, and 2007 resulted in net
losses of $474,101, $551,682, and $431,945, respectively.  The
decrease in net loss from fiscal 2008 to fiscal 2009 is primarily attributable
to a decrease in equity in loss of investment in local partnerships of
approximately $93,000, which decrease is primarily the result of a decrease in
the net operating loss of the Local Partnership in which Registrant continues to
have an investment balance.  The increase in net loss from fiscal 2007
to fiscal 2008 is primarily attributable to a gain of approximately $150,000
recognized in fiscal 2007 in connection with Registrant’s disposal of its
interest in Carrington Limited Dividend Housing Association Limited Partnership
(“Carrington”), partially offset by a decrease in equity in loss of investment
in local partnerships of approximately $30,000, which decrease is the result of
a decrease in voluntary advances made to a Local Partnership that were written
off as equity in loss of investment in local partnerships, partially offset by
an increase in the net operating loss of the Local Partnership in which
Registrant continues to have an investment balance.


14


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





The Local
Partnerships’ net loss of approximately $2,394,000 for the year ended December
31, 2008 includes depreciation and amortization expense of approximately
$3,880,000 and interest on non-mandatory debt of approximately $375,000, and
does not include required principal payments on permanent mortgages of
approximately $882,000.  The Local Partnerships’ net loss of
approximately $2,712,000 for the year ended December 31, 2007 includes
depreciation and amortization expense of approximately $3,938,000 and interest
on non-mandatory debt of approximately $392,000, and does not include required
principal payments on permanent mortgages of approximately
$826,000.  The Local Partnerships’ net loss of approximately
$2,975,000 for the year ended December 31, 2006 includes depreciation and
amortization expense of approximately $4,160,000 and interest on non-mandatory
debt of approximately $385,000, and does not include required principal payments
on permanent mortgages of approximately $846,000.  The results of
operations of the Local Partnerships for the year ended December 31, 2008 are
not necessarily indicative of the results that may be expected in future
periods.





Local Partnership
Matters





Registrant's
primary objective had been to provide Low-income Tax Credits to the Limited
Partners.  The relevant state tax credit agency allocated each of the
Local Partnerships an amount of Low-income Tax Credits, which are generally
available for a ten year period from the year the Property is placed in service
(the “Ten Year Credit Period”).  The Ten Year Credit Period was fully
exhausted with respect to all of the Properties as of December 31,
2003.  The required holding period of each Property, in order to avoid
Low-income Tax Credit recapture, is fifteen years from the year in which the
Low-income Tax Credits commence on the last building of the Property (the
"Compliance Period").  The Compliance Period of all of the Local
Partnerships had expired as of December 31, 2007.  In addition,
certain of the Local Partnerships entered into agreements with the relevant
state tax credit agencies whereby the Local Partnerships must maintain the
low-income nature of the Properties for a period which exceeds the Compliance
Period (in certain circumstances, up to 50 years from when the Property is
placed in service, but commonly 30 years from the date any such Property is
placed in service), regardless of a sale of the Properties by the Local
Partnerships after the Compliance Period (the “Extended Use
Provisions”).  Although the Extended Use Provisions do not extend the
Compliance Period of the respective Local Partnerships, such provisions limit
the number and availability of potential purchasers of the
Properties.  Accordingly, a sale of a Property may happen well after
the expiration of the Compliance Period and/or may be significantly
discounted.  Registrant has served a demand on the Local General
Partners of all remaining Local Partnerships to commence a sale process to
dispose of the Properties.  In the event a sale cannot be consummated,
it is the General Partner’s intention to sell or assign Registrant’s Local
Partnership Interests.  It is not possible to ascertain the amount, if
any, that Registrant will receive with respect to each specific Property from
such sales or assignments.  Registrant intends to dissolve after the
final disposition of its Local Partnership Interests.





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





The Local
Partnerships have various financing structures which include (i) required debt
service payments ("Mandatory Debt Service") and (ii) debt service payments which
are payable only from available cash flow subject to the terms and conditions of
the notes, which may be subject to specific laws, regulations and agreements
with appropriate federal and state agencies ("Non-Mandatory Debt Service or
Interest").  During the year ended December 31, 2008, revenue from
operations of the Local Partnerships was generally sufficient to cover operating
expenses and Mandatory Debt Service.  Substantially all of the Local
Partnerships are effectively operating at or above break even levels, although
certain Local Partnerships' operating information reflects operating deficits
that do not represent cash deficits due to their mortgage and financing
structure and the required deferral of property management
fees.  However, as discussed below, certain Local Partnerships’
operating information indicates an operating deficit after taking into account
their mortgage and financing structure and any required deferral of property
management fees.  Registrant has no legal obligation to fund any such
deficits.


15


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





The terms
of the partnership agreement of Westminster Apartments Limited Partnership
(“Westminster”) require the Local General Partners of Westminster to advance
funds to cover operating deficits through the Compliance
Period.  Westminster has, for several years, been in default under the
terms of its first mortgage; delinquent payments of principal and interest,
replacement reserve deposits and certain fees represent a cumulative arrearage
of approximately $876,000 as of June 2009.  The lender has indicated a
willingness to restructure the debt, whereby payments will be required only to
the extent that Westminster generates available annual cash flow; in addition,
the lender would receive all residual proceeds upon the sale of
Westminster.  There can be no assurance that the issues will be
resolved and the mortgage remains in default without a formal forbearance as of
June 2009.  Westminster incurred an operating deficit of approximately
$123,000 for the year ended December 31, 2008, which amount includes a provision
for replacement reserve deposits of $1,184 per month and debt service payments
of $6,245 per month.  Registrant’s investment balance in Westminster,
after cumulative equity losses, became zero during the year ended March 30,
1999.





The Local
General Partner of Queen Lane Investors (“Queen Lane”) represents that, as a
result of a dispute between the local housing agency (the “Agency”) and the
Local General Partner of Queen Lane regarding the adequacy of certain unit
repairs mandated by the Agency, the Local General Partner of Queen Lane
requested that the Agency cancel the Section 8 voucher contract in connection
with the Property.  As a result, the Property has been vacant since
October 2007.  Two of Queen Lane’s mortgages matured in 2007 but have
not been repaid, representing principal and accrued interest in excess of
$1,885,000 as of June 2009.  The Local General Partner of Queen Lane
further represents that the lender has not issued a notice of default and that
real estate taxes are in arrears approximately $27,000 as of June
2009.  The Local General Partner of Queen Lane is examining the
potential to sell the Property.  Registrant’s investment balance in
Queen Lane, after cumulative equity losses, became zero during the year ended
March 30, 2001.





The terms
of the partnership agreement of Justin Associates (“Justin”) require the Local
General Partners of Justin to cause the management agent to defer property
management fees in order to avoid a default under the
mortgage.  Justin incurred an operating deficit of approximately
$65,000 for the ended December 31, 2008, which includes property management fees
of approximately $18,000.  The Local General Partners of Justin
represent that payments on the mortgage and real estate taxes are
current.  Registrant’s investment balance in Justin, after cumulative
equity losses, became zero during the year ended March 30, 2002.





The terms
of the partnership agreement of Christian Street Commons Associates (“Christian
Street”) require the Local General Partners of Christian Street to advance funds
to cover operating deficits up to $150,000 through 2008 and to cause the
management agent to defer property management fees in order to avoid a default
under the mortgage.  Christian Street incurred an operating deficit of
approximately $41,000 for the year ended December 31, 2008, which includes
property management fees of approximately $4,000.  The Local General
Partners of Christian Street represent that payments on the mortgage and real
estate taxes are current.  Registrant’s investment balance in
Christian Street, after cumulative equity losses, became zero during the year
ended March 30, 1998.





Effective
February 2009, Registrant withdrew from Ashland Park Apartments, L.P. (“Ashland
Park”), in connection with which Registrant received $3,500.  Such
amount is reflected as gain on disposal of limited partner interests/local
partnership properties in the accompanying statement of operations for the year
ended March 30, 2009.  Registrant’s investment balance in Ashland
Park, after cumulative equity losses, became zero during the year ended March
30, 1999.





Inflation





Inflation
is not expected to have a material adverse impact on Registrant’s
operations.


16


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





Contractual
Obligations





As of
March 30, 2009, Registrant has the following contractual obligations (payments
due by period):





Total
                  
                  
                  < 1 year
                  
                  
                  1 - 3 years
                  
                  
                  3 - 5 years
                  
                  
                  > 5 yearsOther
      Long Term Liabilities:Accounts
      Payable and Accrued Expenses (1)
                  
                  $
                  440,673
                  
                  
                  $
                  —
                  
                  
                  $
                  440,673
                  
                  
                  $
                  —
                  
                  
                  $
                  —Payable
      to General Partner and Affiliates (2)
                  
                  
                  2,934,719
                  
                  
                  
                  —
                  
                  
                  
                  2,934,719
                  
                  
                  
                  —
                  
                  
                  
                  —$
                  3,375,392
                  
                  
                  $
                  —
                  
                  
                  $
                  3,375,392
                  
                  
                  $
                  —
                  
                  
                  $
                  —





(1)
            Represents
      Administration Fees payable to a third-party former service provider
      (“MLFA”).  Under the terms of an agreement between Registrant,
      the General Partner and MLFA (the “Deferred Fee Agreement”), such amount
      is payable from 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.  Under the terms of the Deferred Fee Agreement, such
      amount is payable from sale or refinancing proceeds from the Local
      Partnerships to the extent such amounts are
  available.





Off - Balance Sheet
Arrangements





None.





Critical Accounting Policies
and Estimates





The
accompanying financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America (“GAAP”), which
requires Registrant to make certain estimates and assumptions.  A
summary of significant accounting policies is provided in Note 1 to the
accompanying financial statements.  The following section is a summary
of certain aspects of those accounting policies that may require subjective or
complex judgments and are most important to the portrayal of Registrant’s
financial condition and results of operations.  Registrant believes
that there is a low probability that the use of different estimates or
assumptions in making these judgments would result in materially different
amounts being reported in the accompanying financial statements.





·
            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 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 (“FASB”) Interpretation (“FIN”) No.
      46 - Revised, “Consolidation of Variable Interest Entities” (“FIN 46(R)”),
      because Registrant is not considered the primary
      beneficiary.  Registrant’s balance in investment in local
      partnerships 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.


17


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





Recent Accounting
Pronouncements





In June
2006, the FASB issued FIN No. 48, “Accounting for Uncertainty in Income Taxes”
(“FIN 48”), which interprets Statement of Financial Accounting Standard (“SFAS”)
No. 109, “Accounting for Income Taxes” (“SFAS 109”).  FIN 48 requires
all taxpayers to analyze all material positions they have taken or plan to take
in all tax returns that have been filed or should have been filed with all
taxing authorities for all years still subject to challenge by those taxing
authorities.  If the position taken is “more-likely-than-not” to be
sustained by the taxing authority on its technical merits and if there is more
than a 50% likelihood that the position would be sustained if challenged and
considered by the highest court in the relevant jurisdiction, the tax
consequences of that position should be reflected in the taxpayer’s GAAP
financial statements.  Earlier proposed interpretations of SFAS 109
had recommended a “probable” standard for recognition of tax consequences rather
than the “more-likely-than-not” standard finally adopted.





Because
Registrant is a pass-through entity and is not required to pay income taxes, FIN
48 does not currently have any impact on its financial statements.  On
December 30, 2008, the FASB issued Financial Staff Position (“FSP”) No. FIN
48-3: Effective Date of FASB Interpretation No. 48 for Certain Nonpublic
Enterprises, which defers the effective date of FIN 48 for nonpublic enterprises
included within the scope of FSP No. FIN 48-3 to the annual financial statements
for fiscal years beginning after December 15, 2008. The deferred effective date
is intended to give the Board additional time to develop guidance on the
application of FIN 48 by pass-through entities and not-for-profit
organizations.  Registrant may modify its disclosures if the FASB’s
guidance regarding application of FIN 48 to pass-through entities changes and is
extended to public enterprises.





In
September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements,”
(“SFAS 157”).  SFAS 157 defines fair value, establishes a framework
for measuring fair value in accordance with GAAP and expands disclosures about
fair value measurements.  SFAS 157 applies to other accounting
pronouncements that require or permit fair value
measurements.  Accordingly, SFAS 157 does not require any new fair
value measurements.  SFAS 157 is effective for fiscal years beginning
after November 15, 2007.  Registrant adopted SFAS 157 effective
March 31, 2008.  On February 6, 2008 the FASB approved the Financial
Staff Position (“FSP”) that defers the effective date of SFAS 157 by one year
for nonfinancial assets and liabilities that are recognized or disclosed at fair
value in the financial statements on a nonrecurring basis.  The
partial adoption of SFAS 157 for financial assets and liabilities did not
have a material impact on Registrant’s financial position, results of operations
or cash flows.





Registrant
adopted SFAS 157 as of March 31, 2008, with the exception of the application of
the statement to nonrecurring nonfinancial assets and nonfinancial
liabilities.  Nonrecurring nonfinancial assets and liabilities for
which Registrant has not applied the provisions of SFAS 157 include investment
in local partnerships, which is accounted for under the equity method of
accounting.





SFAS 157
establishes a three-tier fair value hierarchy, which prioritizes the inputs used
in measuring fair value.  These tiers include: Level 1, defined as
observable inputs such as quoted prices in active markets for identical assets
or liabilities; Level 2, defined as inputs other than quoted prices for similar
assets or liabilities in active markets that are either directly or
indirectly observable; and Level 3, defined as unobservable inputs in which
little or no market data exists, therefore requiring an entity to develop its
own assumptions.





Financial
assets accounted for at fair value on a recurring basis as of March 30, 2009 are
cash and cash equivalents of $946,612 as reflected in the accompanying balance
sheet.  Cash and cash equivalents are carried at fair value based on
quoted market prices for identical securities (Level 1
inputs).





In
February 2007, the FASB issued SFAS No. 159 “The Fair Value Option for Financial
Assets and Financial Liabilities - including an amendment of FASB Statement No.
115” (“SFAS 159”).  SFAS 159 permits entities to choose to measure
many financial instruments and certain other items at fair value.  The
fair value election is designed to improve financial reporting by providing
entities with the opportunity to mitigate volatility in reported earnings caused
by measuring related assets and liabilities differently without having to apply
complex hedge accounting provisions.  SFAS 159 is effective for fiscal
years beginning after November 15, 2007.  On March 31, 2008,
Registrant adopted SFAS 159 and elected not to apply the provisions of
SFAS 159 to its eligible financial assets and financial liabilities on the
date of adoption.  Accordingly, the initial application of SFAS 159
had no effect on Registrant’s financial statements.


18


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





On
December 4, 2007, the FASB issued SFAS No. 141R, “Business Combinations” (“SFAS
141R”).  SFAS 141R changes the accounting for acquisitions
specifically eliminating the step acquisition model, changing the recognition of
contingent consideration from being recognized when it is probable to being
recognized at the time of acquisition, and disallowing the capitalization of
transaction costs and delays when restructurings related to acquisitions can be
recognized.  SFAS 141R is effective for fiscal years ending after
December 15, 2008.  Registrant is currently evaluating the impact of
the adoption of SFAS 141R on its financial statements.  However,
Registrant does not expect SFAS 141R to have a material impact on its financial
position or results of operations.





On
December 4, 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements, an amendment of ARB No. 51” (“SFAS
160”).  SFAS 160 replaces the concept of minority interest with
noncontrolling interests in subsidiaries.  Noncontrolling interests
will now be reported as a component of equity in the consolidated statement of
financial position.  Earnings attributable to noncontrolling interests
will continue to be reported as a part of consolidated earnings; however, SFAS
160 requires that income attributable to both controlling and noncontrolling
interests be presented separately on the face of the consolidated income
statement.  In addition, SFAS 160 provides that when losses
attributable to noncontrolling interests exceed the noncontrolling interest’s
basis, losses continue to be attributed to the noncontrolling interest as
opposed to being absorbed by the consolidating entity.  SFAS 160
requires retroactive adoption of the presentation and disclosure requirements
for existing minority interests.  All other requirements of SFAS 160
shall be applied prospectively.  SFAS 160 is effective for the first
annual reporting period beginning on or after December 15,
2008.  However, Registrant does not expect SFAS 160 to have a material
impact on its financial statements.





In May
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles” (“SFAS 162”).  The current hierarchy of GAAP is
set forth in the American Institute of Certified Public Accountants (“AICPA”)
Statement on Auditing Standards (“SAS”) No. 69, “The Meaning of Present Fairly
in Conformity With Generally Accepted Accounting Principles” (“SAS
69”).  SFAS 162 is intended to improve financial reporting by
identifying a consistent framework, or hierarchy, for selecting accounting
principles to be used in preparing financial statements that are presented in
conformity with U.S. generally accepted accounting principles for
nongovernmental entities.  SFAS 162 is effective 60 days following the
Securities and Exchange Commission's (the “SEC”) approval of the Public Company
Accounting Oversight Board’s proposed amendments to SAS
69.  Registrant is currently evaluating the impact of SFAS 162 on its
financial statements, but does not believe that the adoption of SFAS 162 will
have a material effect on its financial condition or results of operations since
SFAS 162 does not directly impact the accounting principles applied in the
preparation of Registrant’s financial statements.





In
November 2008, the Emerging Issues Task Force (“EITF”) issued EITF
No. 08-6, “Equity Method Investment Accounting Considerations” (“EITF
08-6”), that addresses how the initial carrying value of an equity method
investment should be determined, how an impairment assessment of an underlying
indefinite-lived intangible asset of an equity method investment should be
performed, how an equity method investee’s issuance of shares should be
accounted for, and how to account for a change in an investment from the equity
method to the cost method.  EITF 08-6 shall be effective in
fiscal years beginning on or after December 15, 2008, and interim
periods within those fiscal years.  EITF 08-6 shall be applied
prospectively with early application prohibited.  The impact of
adopting EITF 08-6 is not expected to have a material impact on
Registrant’s financial condition or results of operations.





In
December 2008, the FASB issued FSP FAS 140-4 and FIN 46(R)-8, “Disclosures by
Public Entities (Enterprises) about Transfers of Financial Assets and Interests
in Variable Interest Entities.”  The FSP amends SFAS No. 140 to
require public entities to provide additional disclosures about transferors’
continuing involvements with transferred financial assets.  It also
amends FIN 46(R) to require public enterprises, including sponsors that have a
variable interest in a Variable Interest Entity, to provide additional
disclosures about their involvement with Variable Interest
Entities.  The FSP also requires disclosures by a public enterprise
that is (a) a sponsor of a qualifying special-purpose entity (“SPE”) that holds
a variable interest in the qualifying SPE but was not the transferor of
financial assets to the qualifying SPE and (b) a servicer of a qualifying SPE
that holds a significant variable interest in the qualifying SPE but was not the
transferor of financial assets to the qualifying SPE.  Registrant
adopted the FSP effective December 2008; such adoption has not had an impact on
Registrant’s financial statements.





In April
2009, the FASB issued FSP 107-1 and APB 28-1 “Interim Disclosures about Fair
Value of Financial Instruments.”  The FSP requires disclosure about
the method and significant assumptions used to establish the fair value of
financial instruments for interim reporting periods as well as annual
statements.  The FSP is effective for Registrant as of June 30, 2009
and will not impact Registrant’s financial condition or results of
operations.


19


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





In May
2009, the FASB issued SFAS No. 165, “Subsequent Events” (“SFAS
165”).  SFAS 165 establishes general standards of accounting for and
disclosure of events that occur after the balance sheet date but before
financial statements are issued or are available to be issued.  SFAS
165 is effective for Registrant as of June 30, 2009.  The adoption of
SFAS 165 is not expected to have a material impact on Registrant’s financial
condition or results of operations.





Item
      7a.
            Quantitative and
      Qualitative Disclosure About Market
Risk.





None.


20


AMERICAN
TAX CREDIT PROPERTIES III L.P.





Item
      8.
            Financial Statements
      and Supplementary Data.





Table of
Contents





PageReport
      of Independent Registered Public Accounting Firm
                
                22Balance
      Sheets
                
                23Statements
      of Operations
                
                24Statements
      of Changes in Partners' Equity (Deficit)
                
                25Statements
      of Cash Flows
                
                26Notes
      to Financial Statements
                
                28





No
financial statement schedules are included because of the absence of the
conditions under which they are required or because the information is included
in the financial statements or the notes thereto.


21


REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





To the
Partners


American
Tax Credit Properties III L.P.





We have
audited the accompanying balance sheets of American Tax Credit Properties III
L.P. (the “Partnership”) as of March 30, 2009 and 2008, and the related
statements of operations, changes in partners' equity (deficit) and cash flows
for each of the three years in the period ended March 30, 2009.  These
financial statements are the responsibility of the Partnership's
management.  Our responsibility is to express an opinion on these
financial statements based on our audits.  As of and for the years
ended March 30, 2009, 2008 and 2007, we did not audit the financial statements
of certain investee partnerships, which investments represent $529,970 and
$504,607, respectively, in total assets as of March 30, 2009 and 2008, and
$25,363, $(52,205) and $0, respectively, of total income (losses) for the years
ended March 30, 2009, 2008 and 2007.  Those statements were audited by
other auditors whose reports have been furnished to us, and our opinion, insofar
as it relates to those investee partnerships, is based solely on the reports of
the other auditors.





We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audits to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  The
Partnership has determined that it is not required to have, nor were we engaged
to perform, an audit of its internal control over financial
reporting.  Our audits included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Partnership’s internal control over
financial reporting.  Accordingly, we express no such
opinion.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe
that our audits, and the reports of the other auditors, provide a reasonable
basis for our opinion.





In our
opinion, based on our audits and the reports of the other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of American Tax Credit Properties III L.P. as of March
30, 2009 and 2008, and the results of its operations, changes in partners’
equity (deficit) and its cash flows for each of the three years in the period
ended March 30, 2009, in conformity with accounting principles generally
accepted in the United States of America.





/s/Reznick Group,
      P.C.Bethesda, MarylandJune
      29, 2009


22


AMERICAN
TAX CREDIT PROPERTIES III L.P.


BALANCE
SHEETS


MARCH
30, 2009 AND 2008





Notes
                  
                  2009
                  
                  
                  2008ASSETSCash
      and cash equivalents
                  
                  3,9
                  
                  $
                  946,612
                  
                  
                  $
                  380,660Investments
      in bonds
                  
                  4,9
                  
                  
                  
                  
                  
                  
                  870,596Investment
      in local partnerships
                  
                  5
                  
                  
                  529,970
                  
                  
                  
                  504,607$
                  1,476,582
                  
                  
                  $
                  1,755,863LIABILITIES
      AND PARTNERS' EQUITY (DEFICIT)LiabilitiesAccounts
      payable and accrued expenses
                  
                  8
                  
                  $
                  523,447
                  
                  
                  $
                  538,625Payable
      to general partner and affiliates
                  
                  6,8
                  
                  
                  2,934,719
                  
                  
                  
                  2,721,2953,458,166
                  
                  
                  
                  3,259,920Commitments
      and contingencies
                  
                  8Partners'
      equity (deficit)
                  
                  2,4General
      partner
                  
                  
                  
                  
                  (1,981,584
                  )
                  
                  
                  (1,507,483
                  )Limited
      partners (35,883 units of limited partnership interest
      outstanding)
                  
                  
                  
                  
                  —
                  
                  
                  
                  —Accumulated
      other comprehensive income, net
                  
                  
                  
                  
                  —
                  
                  
                  
                  3,426(1,981,584
                  )
                  
                  
                  (1,504,057
                  )$
                  1,476,582
                  
                  
                  $
                  1,755,863





See Notes
to Financial Statements.


23


AMERICAN
TAX CREDIT PROPERTIES III L.P.


STATEMENTS
OF OPERATIONS


YEARS
ENDED MARCH 30, 2009, 2008 AND 2007





Notes
                        
                        2009
                        
                        
                        2008
                        
                        
                        2007REVENUEInterest
                        
                        
                        
                        $
                        14,626
                        
                        
                        $
                        56,703
                        
                        
                        $
                        72,044Other
      income from local partnerships
                        
                        
                        
                        
                        46,186
                        
                        
                        
                        26,118
                        
                        
                        
                        23,040TOTAL
      REVENUE
                        
                        
                        
                        
                        60,812
                        
                        
                        
                        82,821
                        
                        
                        
                        95,084EXPENSESAdministration
      fees - affiliate
                        
                        6,8
                        
                        
                        220,825
                        
                        
                        
                        221,540
                        
                        
                        
                        228,313Management
      fees - affiliate
                        
                        6,8
                        
                        
                        220,825
                        
                        
                        
                        221,540
                        
                        
                        
                        228,313Professional
      fees
                        
                        
                        
                        
                        96,342
                        
                        
                        
                        80,084
                        
                        
                        
                        68,965State
      of New Jersey filing fees
                        
                        
                        
                        
                        19,969
                        
                        
                        
                        21,412
                        
                        
                        
                        25,667Printing,
      postage and other
                        
                        
                        
                        
                        5,815
                        
                        
                        
                        22,543
                        
                        
                        
                        28,340TOTAL
      EXPENSES
                        
                        
                        
                        
                        563,776
                        
                        
                        
                        567,119
                        
                        
                        
                        579,598(502,964
                        )
                        
                        
                        (484,298
                        )
                        
                        
                        (484,514
                        )Equity
      in income (loss) of investment in local partnerships
                        
                        5
                        
                        
                        25,363
                        
                        
                        
                        (67,384
                        )
                        
                        
                        (97,326
                        )Loss
      prior to gain on disposal of limited partner interests/local partnership
      properties
                        
                        
                        
                        
                        (477,601
                        )
                        
                        
                        (551,682
                        )
                        
                        
                        (581,840
                        )Gain
      on disposal of limited partner interests/local partnership
      properties
                        
                        5
                        
                        
                        3,500
                        
                        
                        
                        
                        
                        
                        
                        149,895NET
      LOSS
                        
                        
                        
                        
                        (474,101
                        )
                        
                        
                        (551,682
                        )
                        
                        
                        (431,945
                        )Other
      comprehensive income (loss), net
                        
                        4
                        
                        
                        (3,426
                        )
                        
                        
                        5,104
                        
                        
                        
                        (5,270
                        )COMPREHENSIVE
      LOSS
                        
                        
                        
                        $
                        (477,527
                        )
                        
                        $
                        (546,578
                        )
                        
                        $
                        (437,215
                        )NET
      LOSS ATTRIBUTABLE TO
                        
                        2General
      partner
                        
                        
                        
                        $
                        (474,101
                        )
                        
                        $
                        (551,682
                        )
                        
                        $
                        (431,945
                        )Limited
      partners$
                        (474,101
                        )
                        
                        $
                        (551,682
                        )
                        
                        $
                        (431,945
                        )NET LOSSper unit of
      limited partnershipinterest
      (35,883 units of limited partnership interest)
                        
                        
                        
                        $
                        —
                        
                        
                        $
                        —
                        
                        
                        $
                        —





See Notes
to Financial Statements.


24


AMERICAN
TAX CREDIT PROPERTIES III L.P.


STATEMENTS
OF CHANGES IN PARTNERS' EQUITY (DEFICIT)


YEARS
ENDED MARCH 30, 2009, 2008 AND 2007





General
              
              
              Limited
              
              
              Accumulated
      Other
                ComprehensivePartner
              
              
              Partners
              
              
              Income
      (Loss), Net
              
              
              TotalPartners'
      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'
      equity (deficit), March 30, 2007
              
              
              (955,801
              )
              
              
              —
              
              
              
              (1,678
              )
              
              
              (957,479
              )Net
      loss
              
              
              (551,682
              )
              
              
              
              
              
              
              
              
              
              
              (551,682
              )Other
      comprehensive income, net
              
              
              
              
              
              
              
              
              
              
              5,104
              
              
              
              5,104Partners'
      equity (deficit), March 30, 2008
              
              
              (1,507,483
              )
              
              
              —
              
              
              
              3,426
              
              
              
              (1,504,057
              )Net
      loss
              
              
              (474,101
              )
              
              
              
              
              
              
              
              
              
              
              (474,101
              )Other
      comprehensive loss, net
              
              
              
              
              
              
              
              
              
              
              (3,426
              )
              
              
              (3,426
              )Partners'
      deficit, March 30, 2009
              
              $
              (1,981,584
              )
              
              $
              —
              
              
              $
              —
              
              
              $
              (1,981,584
              )





See Notes
to Financial Statements.


25


AMERICAN
TAX CREDIT PROPERTIES III L.P.


STATEMENTS
OF CASH FLOWS


YEARS
ENDED MARCH 30, 2009, 2008 AND 2007





2009
              
              
              2008
              
              
              2007CASH
      FLOWS FROM OPERATING ACTIVITIESInterest
      received
              
              $
              9,796
              
              
              $
              8,385
              
              
              $
              14,109Cash
      paid foradministration
      fees
              
              
              (14,226
              )
              
              
              (15,517
              )
              
              
              (15,553
              )management
      fees
              
              
              (214,000
              )
              
              
              (100,000
              )
              
              
              (159,334
              )professional
      fees
              
              
              (90,178
              )
              
              
              (89,880
              )
              
              
              (51,852
              )State
      of New Jersey filing fees
              
              
              (20,412
              )
              
              
              (22,369
              )
              
              
              (30,000
              )printing,
      postage and other expenses
              
              
              (26,714
              )
              
              
              (3,972
              )
              
              
              (28,340
              )Net
      cash used in operating activities
              
              
              (355,734
              )
              
              
              (223,353
              )
              
              
              (270,970
              )CASH
      FLOWS FROM INVESTING ACTIVITIESProceeds
      in connection with disposal of limited partner interests/local partnership
      properties
              
              
              3,500
              
              
              
              
              
              
              
              149,895Voluntary
      advances to local partnerships
              
              
              
              
              
              
              (15,179
              )
              
              
              (105,311
              )Distributions
      received from local partnerships
              
              
              46,186
              
              
              
              46,118
              
              
              
              33,040Maturities/redemptions
      and sales of bonds
              
              
              872,000
              
              
              
              409,061
              
              
              
              205,989Net
      cash provided by investing activities
              
              
              921,686
              
              
              
              440,000
              
              
              
              283,613Net
      increase in cash and cash equivalents
              
              
              565,952
              
              
              
              216,647
              
              
              
              12,643Cash
      and cash equivalents at beginning of year
              
              
              380,660
              
              
              
              164,013
              
              
              
              151,370CASH
      AND CASH EQUIVALENTS AT END OF YEAR
              
              $
              946,612
              
              
              $
              380,660
              
              
              $
              164,013SIGNIFICANT
      NON-CASH INVESTING ACTIVITIESUnrealized
      gain (loss) on investments in bonds, net
              
              $
              (3,426
              )
              
              $
              5,104
              
              
              $
              (5,270
              )


See
reconciliation of net loss to net cash used in operating activities on page
27.





See Notes
to Financial Statements.


26


AMERICAN
TAX CREDIT PROPERTIES III L.P.


STATEMENTS
OF CASH FLOWS - (Continued)


YEARS
ENDED MARCH 30, 2009, 2008 AND 2007





2009
              
              
              2008
              
              
              2007RECONCILIATION
      OF NET LOSS TO NET CASH USED IN OPERATING ACTIVITIESNet
      loss
              
              $
              (474,101
              )
              
              $
              (551,682
              )
              
              $
              (431,945
              )Adjustments
      to reconcile net loss to net cash used in operating
    activitiesEquity
      in loss (income) of investment in local partnerships
              
              
              (25,363
              )
              
              
              67,384
              
              
              
              97,326Gain
      on disposal of limited partner interests/local partnership
      properties
              
              
              (3,500
              )
              
              
              
              
              
              
              (149,895
              )Distributions
      from local partnerships classified as other income
              
              
              (46,186
              )
              
              
              (26,118
              )
              
              
              (23,040
              )Gain
      on redemptions and sales of bonds
              
              
              
              
              
              
              
              
              
              
              (4,447
              )Amortization
      of net premium on investments in bonds
              
              
              
              
              
              
              
              
              
              
              927Accretion
      of zero coupon bonds
              
              
              (4,830
              )
              
              
              (48,318
              )
              
              
              (56,059
              )Decrease
      in interest receivable
              
              
              
              
              
              
              
              
              
              
              1,644Increase
      in payable to general partner and affiliates
              
              
              213,424
              
              
              
              327,563
              
              
              
              281,739Increase
      (decrease) in accounts payable and accrued expenses
              
              
              (15,178
              )
              
              
              7,818
              
              
              
              12,780NET
      CASH USED IN OPERATING ACTIVITIES
              
              $
              (355,734
              )
              
              $
              (223,353
              )
              
              $
              (270,970
              )





See Notes
to Financial Statements.


27


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS


MARCH
30, 2009, 2008 AND 2007





1.
            Organization,
      Purpose and Summary of Significant Accounting
  Policies





American
Tax Credit Properties III L.P. (the "Partnership") was formed on September 21,
1989 and the Certificate of Limited Partnership of the Partnership was filed
under the Delaware Revised Uniform Limited Partnership Act.  There was
no operating activity until admission of the limited partners (the “Limited
Partners”) on June 13, 1990.  The Partnership was formed to invest
primarily in leveraged low-income multifamily residential complexes (the
“Property” or “Properties”) that qualified for the low-income tax credit in
accordance with Section 42 of the Internal Revenue Code (the “Low-income Tax
Credit”), through the acquisition of limited partner equity interests (the
"Local Partnership Interests") in partnerships (the "Local Partnership" or
"Local Partnerships") that are the owners of the Properties.  Richman
Tax Credit Properties III L.P. (the "General Partner") was formed on September
21, 1989 to act as the General Partner of the Partnership.





Basis of Accounting and
Fiscal Year





The
Partnership's records are maintained on the accrual basis of accounting for both
financial reporting and tax purposes.  For financial reporting
purposes, the Partnership's fiscal year ends March 30 and its quarterly periods
end June 29, September 29 and December 30.  The Local Partnerships
have a calendar year for financial reporting purposes.  The
Partnership and the Local Partnerships each have a calendar year for income tax
purposes.





Investment in Local
Partnerships





The
Partnership accounts for its investment in local partnerships in accordance with
the equity method of accounting, under which the investment is carried at cost
and is adjusted for the Partnership's share of each Local Partnership’s results
of operations and by cash distributions received.  Equity in loss of
each investment in Local Partnership allocated to the Partnership is recognized
to the extent of the Partnership’s investment balance in each Local
Partnership.  Equity in loss in excess of the Partnership’s investment
balance in a Local Partnership is allocated to other partners’ capital in any
such Local Partnership.  Previously unrecognized equity in loss of any
Local Partnership is recognized in the fiscal year in which equity in income is
earned by such Local Partnership or additional investment is made by the
Partnership.  Distributions received subsequent to the elimination of
an investment balance for any such investment in a Local Partnership are
recorded as other income from local partnerships.





The
Partnership assesses the carrying value of its investment in local partnerships
at least annually in the fourth quarter of its fiscal year or whenever there are
indications that a permanent impairment may have occurred.  If the
carrying value of an investment in a Local Partnership exceeds the estimated
value derived by management, the Partnership reduces its investment in any such
Local Partnership and includes such reduction in equity in loss of investment in
local partnerships.  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 estimated residual value of the investment.





The
Partnership does not consolidate the accounts and activities of the Local
Partnerships, which are considered Variable Interest Entities under Financial
Accounting Standards Board (“FASB”) Interpretation (“FIN”) No. 46 - Revised,
“Consolidation of Variable Interest Entities” (“FIN 46(R)”) because the
Partnership is not considered the primary beneficiary.  The
Partnership's balance in investment in local partnerships represents the maximum
exposure to loss in connection with such investments.  The
Partnership'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 (the “Local General
Partners”).





Advances
and additional capital contributions (collectively the “Advances”) that are not
required under the terms of the Local Partnerships’ partnership agreements but
which are made to the Local Partnerships are recorded as investment in local
partnerships.  Certain Advances are considered by the Partnership to
be voluntary loans to the respective Local Partnerships and the Partnership may
be reimbursed at a future date to the extent such Local Partnerships generate
distributable cash flow or receive proceeds from sale or
refinancing.  The Partnership recognizes additional equity in loss of
investment in local partnerships to the extent of such
Advances.


28


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





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





Cash and Cash
Equivalents





The
Partnership considers all highly liquid investments purchased with an original
maturity of three months or less at the date of acquisition to be cash
equivalents.  Cash and cash equivalents are stated at cost, which
approximates market value.





Income
Taxes





No
provision or benefit for income taxes has been made because all income and
losses are allocated to the partners for inclusion in their respective tax
returns.  In accordance with Statement of Financial Accounting
Standard (“SFAS”) No. 109, "Accounting for Income Taxes" (“SFAS 109”), the
Partnership has included in Note 7 disclosures related to differences in the
financial and tax bases of accounting.  In June 2006, the FASB issued
FIN No. 48 “Accounting for Uncertainty in Income Taxes” (“FIN 48”), an
interpretation of SFAS 109.  FIN 48 provides guidance for how
uncertain tax positions should be recognized, measured, presented and disclosed
in the financial statements.  FIN 48 requires the evaluation of tax
positions taken or expected to be taken in the course of preparing the
Partnership’s tax returns to determine whether the tax positions are
more-likely-than-not of being sustained upon examination by the applicable tax
authority, based on the tax authority, based on the technical merits of the tax
position, and then recognizing the tax benefit that is more-likely-than-not to
be to be realized.  Tax positions not deemed to meet the
more-likely-than-not threshold would be recorded as a tax expense in the current
reporting period.  As required, the Partnership adopted FIN 48
effective March 31, 2008 and concluded that the effect is not material to its
financial statements.  Accordingly, no cumulative effect adjustment
related to the adoption of FIN 48 was recorded.





Investments in
Bonds





Investments
in bonds are classified as available-for-sale and represent investments that the
Partnership intends to hold for an indefinite period of time but not necessarily
to maturity.  Any decision to sell an investment would be based on
various factors, including significant movements in interest rates and liquidity
needs.  Investments in bonds are carried at estimated fair value and
unrealized gains or losses are included as items of comprehensive income (loss)
and are reported as a separate component of partners' equity
(deficit).





Premiums
and discounts on investments in bonds are amortized (accreted) using the
effective yield method over the life of the investment.  Amortized
premiums offset interest revenue, while the accretion of discounts and zero
coupon bonds are included in interest revenue.  Realized gain (loss)
on redemptions or sales of investments in bonds are included in, or offset
against, interest revenue on the basis of the adjusted cost of each specific
investment redeemed or sold.  All such investments have matured and/or
been redeemed or sold as of March 30, 2009.





Use of
Estimates





The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America (“GAAP”) requires management
to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities as of the date
of the financial statements and the reported amounts of revenue and expenses
during the reporting period.  Actual results could differ from those
estimates.





Reclassifications





Certain
prior year amounts have been reclassified to conform to the current year
presentation.


29


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





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





Recent Accounting
Pronouncements





In
September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements,”
(“SFAS 157”).  SFAS 157 defines fair value, establishes a framework
for measuring fair value in accordance with GAAP and expands disclosures about
fair value measurements.  SFAS 157 applies to other accounting
pronouncements that require or permit fair value
measurements.  Accordingly, SFAS 157 does not require any new fair
value measurements.  SFAS 157 is effective for fiscal years beginning
after November 15, 2007.  The Partnership adopted SFAS 157
effective March 31, 2008.  On February 6, 2008 the FASB approved the
Financial Staff Position (“FSP”) that defers the effective date of SFAS 157 by
one year for nonfinancial assets and liabilities that are recognized or
disclosed at fair value in the financial statements on a nonrecurring
basis.  The partial adoption of SFAS 157 for financial assets and
liabilities did not have a material impact on the Partnership’s financial
position, results of operations or cash flows.





The
Partnership adopted SFAS 157 as of March 31, 2008, with the exception of the
application of the statement to nonrecurring nonfinancial assets and
nonfinancial liabilities.  Nonrecurring nonfinancial assets and
liabilities for which the Partnership has not applied the provisions of SFAS 157
include investment in local partnerships, which is accounted for under the
equity method of accounting.





SFAS 157
establishes a three-tier fair value hierarchy, which prioritizes the inputs used
in measuring fair value.  These tiers include: Level 1, defined as
observable inputs such as quoted prices in active markets for identical assets
or liabilities; Level 2, defined as inputs other than quoted prices for similar
assets or liabilities in active markets that are either directly or
indirectly observable; and Level 3, defined as unobservable inputs in which
little or no market data exists, therefore requiring an entity to develop its
own assumptions.





Financial
assets accounted for at fair value on a recurring basis as of March 30, 2009 are
cash and cash equivalents of $946,612 as reflected in the accompanying balance
sheet.  Cash and cash equivalents are carried at fair value based on
quoted market prices for identical securities (Level 1
inputs).





In May
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles” (“SFAS 162”).  The current hierarchy of GAAP is
set forth in the American Institute of Certified Public Accountants (“AICPA”)
Statement on Auditing Standards (“SAS”) No. 69, “The Meaning of Present Fairly
in Conformity With Generally Accepted Accounting Principles” (“SAS
69”).  SFAS 162 is intended to improve financial reporting by
identifying a consistent framework, or hierarchy, for selecting accounting
principles to be used in preparing financial statements that are presented in
conformity with U.S. generally accepted accounting principles for
nongovernmental entities.  SFAS 162 is effective 60 days following the
Securities and Exchange Commission's (the “SEC”) approval of the Public Company
Accounting Oversight Board’s proposed amendments to SAS 69.  The
Partnership is currently evaluating the impact of SFAS 162 on its financial
statements, but does not believe that the adoption of SFAS 162 will have a
material effect on its financial condition or results of operations since SFAS
162 does not directly impact the accounting principles applied in the
preparation of the Partnership’s financial statements.





In
December 2008, the FASB issued FSP FAS 140-4 and FIN 46(R)-8, “Disclosures by
Public Entities (Enterprises) about Transfers of Financial Assets and Interests
in Variable Interest Entities.”  The FSP amends SFAS No. 140 to
require public entities to provide additional disclosures about transferors’
continuing involvements with transferred financial assets.  It also
amends FIN 46(R) to require public enterprises, including sponsors that have a
variable interest in a Variable Interest Entity, to provide additional
disclosures about their involvement with Variable Interest
Entities.  The FSP also requires disclosures by a public enterprise
that is (a) a sponsor of a qualifying special-purpose entity (“SPE”) that holds
a variable interest in the qualifying SPE but was not the transferor of
financial assets to the qualifying SPE and (b) a servicer of a qualifying SPE
that holds a significant variable interest in the qualifying SPE but was not the
transferor of financial assets to the qualifying SPE.  The Partnership
adopted the FSP effective December 2008; such adoption has not had an impact on
the Partnership’s financial statements.


30




AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007








2.
            Capital
      Contributions





On March
12, 1990, the Partnership commenced the offering of units (the “Units”) through
Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Selling
Agent").  On June 13, 1990, December 27, 1990, December 31, 1991 and
January 23, 1992, under the terms of the Amended and Restated Agreement of
Limited Partnership of the Partnership (the "Partnership Agreement"), the
General Partner admitted the Limited Partners to the Partnership in four
closings.  At these closings, subscriptions for a total of 35,883
Units representing $35,883,000 in Limited Partners' capital contributions were
accepted.  In connection with the offering of Units, the Partnership
incurred organization and offering costs of $4,418,530, of which $75,000 was
capitalized as organization costs and $4,343,530 was charged to the Limited
Partners' equity as syndication costs.  The Partnership received a
capital contribution of $100 from the General Partner.





Net loss
is allocated 99% to the Limited Partners and 1% to the General Partner in
accordance with the Partnership Agreement, until such time as the Limited
Partners' capital reaches zero as a result of loss allocations, after which all
losses are allocated to the General Partner.





3.
            Cash
      and Cash Equivalents





As of
March 30, 2009, the Partnership has $946,612 in cash and cash equivalents held
in interest bearing accounts.  Of such amount, approximately $928,000
is held in a financial institution in which such amount is invested in a
portfolio of securities that are direct obligations of the U.S. Treasury and are
backed by the full faith and credit of the United States of
America.  Approximately $19,000 is held in a financial institution
insured by the Securities Investor Protection Corporation
(“SIPC”).  Such accounts have coverage which is limited to $500,000;
while SIPC provides insurance for funds which are misappropriated, it does not
insure amounts which may be lost as a result of changes in market
conditions.





4.
            Investments
      in Bonds





The
Partnership carried its investments in bonds as available-for-sale because such
investments were used to facilitate and provide flexibility for the
Partnership's obligations, including the providing of Advances from
circumstances that arose in connection with the Local
Partnerships.  Investments in bonds are reflected in the accompanying
balance sheets at estimated fair value.  All such investments have
matured and/or been redeemed or sold as of March 30, 2009.





As of
March 30, 2008, certain information concerning investments in bonds is as
follows:





Description and maturity
                    
                    Amortized
                        cost
                    
                    
                    Gross
                        unrealized
                        gains
                    
                    
                    Gross
                        unrealized
                        losses
                    
                    
                    Estimated
                        fair
                        valueU.S.
      Treasury debt securitiesWithin
      one year
                    
                    $
                    867,170
                    
                    
                    $
                    3,426
                    
                    
                    $
                    —
                    
                    
                    $
                    870,596




31


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships





As of
March 30, 2009, the Partnership owns a Local Partnership Interest in the
following Local Partnerships:





1.
                
                April
      Gardens Apartments II Limited Partnership;2.
                
                Auburn
      Family, L.P.;3.
                
                Batesville
      Family, L.P.;4.
                
                Bay
      Springs Elderly, L.P.;5.
                
                Brisas
      del Mar Apartments Limited Partnership;6.
                
                Bruce
      Housing Associates, L.P.;7.
                
                Chestnut
      Park Associates, L.P.*;8.
                
                Chowan
      Senior Manor Associates Limited Partnership;9.
                
                Christian
      Street Commons Associates;10.
                
                Country
      View Apartments;11.
                
                Desarrollos
      de Belen Limited Partnership;12.
                
                Desarrollos
      de Emaus Limited Partnership;13.
                
                Ellinwood
      Heights Apartments, L.P.;14.
                
                Fulton
      Street Houses Limited Partnership;15.
                
                Hayes
      Run Limited Partnership;16.
                
                Howard
      L. Miller Sallisaw Apartments II, L.P.;17.
                
                Hurlock
      Meadow Limited Partnership;18.
                
                Ivy
      Family, L.P.;19.
                
                Justin
      Associates;20.
                
                LaBelle
      Commons, Ltd.;21.
                
                Lawrence
      Road Properties, Ltd.;22.
                
                Loma
      Del Norte Limited Partnership;23.
                
                Long
      Reach Associates Limited Partnership;24.
                
                Mirador
      del Toa Limited Partnership;25.
                
                Moore
      Haven Commons, Ltd.;26.
                
                NP-89
      Limited Dividend Housing Association Limited Partnership
      (“NP-89”);27.
                
                Nash
      Hill Associates, Limited Partnership;28.
                
                North
      Calhoun City, L.P.;29.
                
                Orange
      City Plaza, Limited Partnership (“Orange City”);30.
                
                Puerta
      del Mar Limited Partnership;31.
                
                Purvis
      Heights Properties, L.P.;32.
                
                Queen
      Lane Investors (“Queen Lane”);33.
                
                Somerset
      Manor, Ltd.;34.
                
                Sugar
      Cane Villas, Ltd.;35.
                
                Summerfield
      Apartments Limited Partnership;36.
                
                Sydney
      Engel Associates L.P. (formerly known as Sydney Engel
      Associates)*;37.
                
                Union
      Valley Associates Limited Partnership;38.
                
                Walnut
      Grove Family, L.P.;39.
                
                Waynesboro
      Apartments Limited Partnership;40.
                
                West
      Calhoun City, L.P.; and41.
                
                Westminster
      Apartments Limited Partnership
(“Westminster”).





*
              An
      affiliate of the General Partner is a general partner or special limited
      partner of and/or provides services to the Local
    Partnership.




32


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment in Local
      Partnerships (continued)





Although
the Partnership generally owns a 98.9%-99% Local Partnership Interest in the
Local Partnerships, the Partnership and American Tax Credit Properties II L.P.
("ATCP II"), a Delaware limited partnership whose general partner is affiliated
with the General Partner, together, in the aggregate, own a 99% interest in the
following Local Partnerships:





The
                    Partnership
                
                
                ATCP IIBatesville
      Family, L.P.
                
                
                61.75%
                
                
                
                37.25%Bruce
      Housing Associates, L.P.
                
                
                61.75
                
                
                
                37.25Ivy
      Family, L.P.
                
                
                61.75
                
                
                
                37.25Lawrence
      Road Properties, Ltd.
                
                
                61.75
                
                
                
                37.25Mirador
      del Toa Limited Partnership
                
                
                59.06
                
                
                
                39.94Purvis
      Heights Properties, L.P.
                
                
                61.75
                
                
                
                37.25Queen
      Lane Investors
                
                
                48.50
                
                
                
                50.50





The
Properties are principally comprised of subsidized and leveraged low-income
multifamily residential complexes located throughout the United States and
Puerto Rico.  The required holding period of each Property, in order
to avoid Low-income Tax Credit recapture, is fifteen years from the year in
which the Low-income Tax Credits commence on the last building of the Property
(the "Compliance Period").  The rents of the Properties are controlled
by federal and state agencies pursuant to applicable laws and
regulations.  Under the terms of each of the Local Partnership's
partnership agreements, as of March 30, 2009 the Partnership is committed to
make capital contributions in the aggregate amount of $29,384,966, which
includes Advances made to a certain Local Partnership and all of which has been
paid.  As of December 31, 2008, the Local Partnerships have
outstanding mortgage loans payable totaling approximately $75,985,000 and
accrued interest payable on such loans totaling approximately $6,016,000, which
are secured by security interests and liens common to mortgage loans on the
Local Partnerships' real property and other assets.





Equity in
loss of investment in local partnerships is limited to the Partnership’s
investment balance in each Local Partnership; any such excess is applied to
other partners' capital in any such Local Partnership (see Note
1).  The amount of such excess losses applied to other partners'
capital was $2,292,014, $2,461,655, and $2,668,471 for the years ended December
31, 2008, 2007 and 2006, respectively, as reflected in the combined statements
of operations of the Local Partnerships herein Note 5.





Westminster
has, for several years, been in default under the terms of its first mortgage;
delinquent payments of principal and interest, replacement reserve deposits and
certain fees represent a cumulative arrearage of approximately $876,000 as of
June 2009.  The lender has indicated a willingness to restructure the
debt, whereby payments will be required only to the extent that Westminster
generates available annual cash flow; in addition, the lender would receive all
residual proceeds upon the sale of Westminster.  There can be no
assurance that the issues will be resolved and the mortgage remains in default
without a formal forbearance as of June 2009.  The Partnership’s
investment balance in Westminster, after cumulative equity losses, became zero
during the year ended March 30, 1999.





The Local
General Partner of Queen Lane represents that, as a result of a dispute between
the local housing agency (the “Agency”) and the Local General Partner of Queen
Lane regarding the adequacy of certain unit repairs mandated by the Agency, the
Local General Partner of Queen Lane requested that the Agency cancel the Section
8 voucher contract in connection with the Property.  As a result, the
Property has been vacant since October 2007.  Two of Queen Lane’s
mortgages matured in 2007 but have not been repaid, representing principal and
accrued interest in excess of $1,885,000 as of June 2009.  The Local
General Partner of Queen Lane further represents that the lender has not issued
a notice of default and that real estate taxes are in arrears approximately
$27,000 as of June 2009.  The Local General Partner of Queen Lane is
examining the potential to sell the Property.  The Partnership’s
investment balance in Queen Lane, after cumulative equity losses, became zero
during the year ended March 30, 2001.


33


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships (continued)





The
Partnership made Advances of $15,179 and $105,311 to Orange City for the years
ended March 30, 2008 and 2007, respectively, to fund operating
deficits.  Cumulative Advances as of March 30, 2009 and 2008 are
$120,490.  The Partnership’s investment balance in Orange City, after
cumulative equity losses, became zero during the year ended March 30, 2002 and
Advances made by the Partnership have been recorded as investment in local
partnerships and offset by additional equity in loss of investment in local
partnerships in the accompanying financial statements.





Effective
February 2009, the Partnership withdrew from Ashland Park Apartments, L.P.
(“Ashland Park”), in connection with which the Partnership received
$3,500.  Such amount is reflected as gain on disposal of limited
partner interests/local partnership properties in the accompanying statement of
operations of the Partnership for the year ended March 30, 2009.  The
Partnership’s investment balance in Ashland Park, after cumulative equity
losses, became zero during the year ended March 30, 1999.





Effective
February 2007, the Partnership assigned its Local Partnership Interest in
Carrington Limited Dividend Housing Association Limited Partnership
(“Carrington”) to one of Carrington’s Local General Partners, whereby the
Partnership received $149,895.  Such amount is reflected as gain on
disposal of limited partner interests/local partnership properties in the
accompanying statement of operations of the Partnership for the year ended March
30, 2007.  The Partnership’s investment balance in Carrington, after
cumulative equity losses, became zero during the year ended March 30,
2006.





The
combined balance sheets of the Local Partnerships as of December 31, 2008 and
2007 and the combined statements of operations of the Local Partnerships for the
years ended December 31, 2008, 2007 and 2006 are reflected on pages 35 and 36,
respectively.


34


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships (continued)





The
combined balance sheets of the Local Partnerships as of December 31, 2008 and
2007 are as follows:





2008
                
                
                2007ASSETSCash
      and cash equivalents
                
                $
                1,685,633
                
                
                $
                1,432,375Rents
      receivable
                
                
                485,248
                
                
                
                570,510Escrow
      deposits and reserves
                
                
                5,036,286
                
                
                
                4,735,459Land
                
                
                3,710,215
                
                
                
                3,710,215Buildings
      and improvements (net of accumulated depreciation of $66,823,930 and
      $62,997,117)
                
                
                45,436,519
                
                
                
                48,507,023Intangible
      assets (net of accumulated amortization of$601,103
      and $575,345)
                
                
                263,106
                
                
                
                289,390Other
      assets
                
                
                1,328,980
                
                
                
                1,292,657$
                57,945,987
                
                
                $
                60,537,629LIABILITIES
      AND PARTNERS' EQUITY (DEFICIT)LiabilitiesAccounts
      payable and accrued expenses
                
                $
                1,344,773
                
                
                $
                1,497,839Due
      to related parties
                
                
                5,212,785
                
                
                
                4,792,214Mortgage
      loans
                
                
                75,984,949
                
                
                
                76,602,199Accrued
      interest
                
                
                6,015,631
                
                
                
                5,833,343Other
      liabilities
                
                
                764,520
                
                
                
                807,71389,322,658
                
                
                
                89,533,308Partners'
      equity (deficit)American
      Tax Credit Properties III L.P.Capital
      contributions, net of distributions
                
                
                26,588,807
                
                
                
                26,588,807Cumulative
      loss
                
                
                (24,748,692
                )
                
                
                (24,774,055
                )1,840,115
                
                
                
                1,814,752General
      partners and other limited partnersCapital
      contributions, net of distributions
                
                
                (1,390,117
                )
                
                
                (1,402,781
                )Cumulative
      loss
                
                
                (31,826,669
                )
                
                
                (29,407,650
                )(33,216,786
                )
                
                
                (30,810,431
                )(31,376,671
                )
                
                
                (28,995,679
                )$
                57,945,987
                
                
                $
                60,537,629


35


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships (continued)





The
combined statements of operations of the Local Partnerships for the years ended
December 31, 2008, 2007 and 2006 are as follows:





2008
                
                
                2007
                
                
                2006REVENUERental
                
                $
                12,349,316
                
                
                $
                11,813,515
                
                
                $
                12,260,770Interest
      and other
                
                
                313,636
                
                
                
                384,392
                
                
                
                398,638TOTAL
      REVENUE
                
                
                12,662,952
                
                
                
                12,197,907
                
                
                
                12,659,408EXPENSESAdministrative
                
                
                3,016,090
                
                
                
                2,684,920
                
                
                
                2,831,638Utilities
                
                
                1,784,854
                
                
                
                1,785,113
                
                
                
                1,784,166Operating
      and maintenance
                
                
                3,029,077
                
                
                
                3,009,870
                
                
                
                2,983,376Taxes
      and insurance
                
                
                1,164,195
                
                
                
                1,232,301
                
                
                
                1,283,973Financial
                
                
                2,182,047
                
                
                
                2,260,472
                
                
                
                2,590,917Depreciation
      and amortization
                
                
                3,880,345
                
                
                
                3,937,524
                
                
                
                4,160,276TOTAL
      EXPENSES
                
                
                15,056,608
                
                
                
                14,910,200
                
                
                
                15,634,346NET
      LOSS
                
                $
                (2,393,656
                )
                
                $
                (2,712,293
                )
                
                $
                (2,974,938
                )NET
      INCOME (LOSS) ATTRIBUTABLE TOAmerican
      Tax Credit Properties III L.P.
                
                $
                25,363
                
                
                $
                (67,384
                )
                
                $
                (97,326
                )General
      partners and other limited partners (includes $2,292,014, $2,461,655 and
      $2,668,471 of Partnership loss in excess of investment)
                
                
                (2,419,019
                )
                
                
                (2,644,909
                )
                
                
                (2,877,612
                )$
                (2,393,656
                )
                
                $
                (2,712,293
                )
                
                $
                (2,974,938
                )




36


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships (continued)





Investment
activity with respect to each Local Partnership for the year ended March 30,
2009 is as follows:





Name of Local Partnership
                      
                      Investment
                        inLocal
                        Partnership
                        balance as of
                        March 30,
                        2008
                      
                      
                      Investments
                        (voluntary
                        advances)
                        during the year
                        ended
                        March 30,
                        2009
                      
                      
                      Partnership's
                        equity in
                        income for the
                        year
      ended
                        December
      31,
                        2008
                      
                      
                      Adjustment to
                        carrying value
                        during the
                        year
      ended
                        March
      30,
                        2009
                      
                      
                      Cash
                        distributions
                        received
                        during
      the
                        year
      ended
                        March
      30,
                        2008 (2)
                      
                      
                      Investment
                        in
      Local
                        Partnership
                        balance as of
                        March 30,
                        2009April
      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
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —
                      (1)
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —Bruce
      Housing Associates, L.P.
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —
                      (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
                      
                      
                      504,607
                      
                      
                      
                      —
                      
                      
                      
                      25,363
                      
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      529,970Nash
      Hill Associates, Limited Partnership
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —
                      (1)
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —North
      Calhoun City, L.P.
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —
                      (1)
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —Orange
      City Plaza, Limited Partnership
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —
                      (1)
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —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)
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —$
                      504,607
                      
                      
                      $
                      —
                      
                      
                      $
                      25,363
                      
                      
                      $
                      —
                      
                      
                      $
                      —
                      
                      
                      $
                      529,970





(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
      total excludes $46,186 of distributions received classified as other
      income from local partnerships and $3,500 received in connection with
      disposal of limited partner interests/local partnership
      properties.




37


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships (continued)





Investment
activity with respect to each Local Partnership for the year ended March 30,
2008 is as follows:





Name of Local Partnership
                    
                    Investment
                      in Local
                      Partnership
                      balance as of
                      March 30,
                      2007
                    
                    
                    Investments
                      (voluntary
                      advances)
                      during the year
                      ended
                      March 30,
                      2008
                    
                    
                    Partnership's
                      equity in
                      loss for the
                      year ended
                      December 31,
                      2007
                    
                    
                    Adjustment to
                      carrying value
                      during the
                      year ended
                      March 30,
                      2008
                    
                    
                    Cash
                      distributions
                      received
                      during the
                      year ended
                      March 30,
                      2008 (3)
                    
                    
                    Investment
                      in Local
                      Partnership
                      balance as of
                      March 30,
                      2008April
      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
                    
                    
                    —
                    
                    
                    
                    —
                    
                    
                    
                    —
                    (1)
                    
                    
                    —
                    
                    
                    
                    —
                    
                    
                    
                    —Bruce
      Housing Associates, L.P.
                    
                    
                    —
                    
                    
                    
                    —
                    
                    
                    
                    —
                    (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
                    
                    
                    576,812
                    
                    
                    
                    —
                    
                    
                    
                    (52,205
                    )
                    
                    
                    —
                    
                    
                    
                    (20,000
                    )
                    
                    
                    504,607Nash
      Hill Associates, Limited Partnership
                    
                    
                    —
                    
                    
                    
                    —
                    
                    
                    
                    —
                    (1)
                    
                    
                    —
                    
                    
                    
                    —
                    
                    
                    
                    —North
      Calhoun City, L.P.
                    
                    
                    —
                    
                    
                    
                    —
                    
                    
                    
                    —
                    (1)
                    
                    
                    —
                    
                    
                    
                    —
                    
                    
                    
                    —Orange
      City Plaza, Limited Partnership
                    
                    
                    —
                    
                    
                    
                    15,179
                    
                    
                    
                    (15,179
                    ) (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)
                    
                    
                    —
                    
                    
                    
                    —
                    
                    
                    
                    —$
                    576,812
                    
                    
                    $
                    15,179
                    
                    
                    $
                    (67,384
                    )
                    
                    $
                    —
                    
                    
                    $
                    (20,000
                    )
                    
                    $
                    504,607





(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 $26,118 of distributions received classified as other
      income from local partnerships.




38


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships (continued)





Property
information for each Local Partnership as of December 31, 2008 is as
follows:





Name of Local Partnership
                      
                      Mortgage
                        loans payable
                      
                      
                      Land
                      
                      
                      Buildings and
                        improvements
                      
                      
                      Accumulated
                        depreciationApril
      Gardens Apartments II Limited Partnership
                      
                      $
                      1,930,431
                      
                      
                      $
                      39,984
                      
                      
                      $
                      2,565,230
                      
                      
                      $
                      (1,812,522
                      )Ashland
      Park Apartments, L.P.
                      
                      
                      1,001,691
                      
                      
                      
                      50,160
                      
                      
                      
                      1,293,736
                      
                      
                      
                      (837,252
                      )Auburn
      Family, L.P.
                      
                      
                      439,806
                      
                      
                      
                      20,000
                      
                      
                      
                      670,068
                      
                      
                      
                      (323,057
                      )Batesville
      Family, L.P.
                      
                      
                      1,396,285
                      
                      
                      
                      52,000
                      
                      
                      
                      1,892,764
                      
                      
                      
                      (989,,635
                      )Bay
      Springs Elderly, L.P.
                      
                      
                      654,239
                      
                      
                      
                      38,000
                      
                      
                      
                      938,296
                      
                      
                      
                      (475,388
                      )Brisas
      del Mar Apartments Limited Partnership
                      
                      
                      2,556,919
                      
                      
                      
                      100,280
                      
                      
                      
                      3,505,988
                      
                      
                      
                      (2,457,550
                      )Bruce
      Housing Associates, L.P.
                      
                      
                      1,064,826
                      
                      
                      
                      16,000
                      
                      
                      
                      1,643,636
                      
                      
                      
                      (972,130
                      )Chestnut
      Park Associates, L.P.
                      
                      
                      4,337,275
                      
                      
                      
                      781,700
                      
                      
                      
                      8,715,836
                      
                      
                      
                      (5,568,980
                      )Chowan
      Senior Manor Associates Limited Partnership
                      
                      
                      1,194,083
                      
                      
                      
                      86,101
                      
                      
                      
                      1,611,708
                      
                      
                      
                      (1,023,552
                      )Christian
      Street Commons Associates
                      
                      
                      521,832
                      
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —Country
      View Apartments
                      
                      
                      905,761
                      
                      
                      
                      35,698
                      
                      
                      
                      1,314,750
                      
                      
                      
                      (559,551
                      )Desarrollos
      de Belen Limited Partnership
                      
                      
                      1,817,596
                      
                      
                      
                      96,190
                      
                      
                      
                      2,519,166
                      
                      
                      
                      (1,373,000
                      )Desarrollos
      de Emaus Limited Partnership
                      
                      
                      3,089,078
                      
                      
                      
                      214,000
                      
                      
                      
                      4,115,793
                      
                      
                      
                      (2,126,711
                      )Ellinwood
      Heights Apartments, L.P.
                      
                      
                      664,920
                      
                      
                      
                      10,000
                      
                      
                      
                      1,036,661
                      
                      
                      
                      (456,326
                      )Fulton
      Street Houses Limited Partnership
                      
                      
                      3,869,930
                      
                      
                      
                      2
                      
                      
                      
                      5,983,089
                      
                      
                      
                      (3,679,123
                      )Hayes
      Run Limited Partnership
                      
                      
                      1,378,596
                      
                      
                      
                      85,060
                      
                      
                      
                      1,703,131
                      
                      
                      
                      (796,891
                      )Howard
      L. Miller Sallisaw Apartments II, L.P.
                      
                      
                      596,258
                      
                      
                      
                      39,000
                      
                      
                      
                      823,657
                      
                      
                      
                      (327,881
                      )Hurlock
      Meadow Limited Partnership
                      
                      
                      1,225,472
                      
                      
                      
                      49,525
                      
                      
                      
                      1,647,845
                      
                      
                      
                      (1,038,310
                      )Ivy
      Family, L.P.
                      
                      
                      731,946
                      
                      
                      
                      11,000
                      
                      
                      
                      1,238,287
                      
                      
                      
                      (718,876
                      )Justin
      Associates
                      
                      
                      2,084,848
                      
                      
                      
                      27,472
                      
                      
                      
                      4,378,882
                      
                      
                      
                      (2,707,691
                      )LaBelle
      Commons, Ltd.
                      
                      
                      978,339
                      
                      
                      
                      98,947
                      
                      
                      
                      1,263,737
                      
                      
                      
                      (732,820
                      )Lawrence
      Road Properties, Ltd.
                      
                      
                      733,946
                      
                      
                      
                      50,000
                      
                      
                      
                      982,221
                      
                      
                      
                      (510,645
                      )Loma
      Del Norte Limited Partnership
                      
                      
                      1,391,814
                      
                      
                      
                      84,874
                      
                      
                      
                      2,031,383
                      
                      
                      
                      (894,984
                      )Long
      Reach Associates Limited Partnership
                      
                      
                      1,431,058
                      
                      
                      
                      118,446
                      
                      
                      
                      1,940,133
                      
                      
                      
                      (917,195
                      )Mirador
      del Toa Limited Partnership
                      
                      
                      1,811,472
                      
                      
                      
                      105,000
                      
                      
                      
                      2,393,997
                      
                      
                      
                      (1,687,038
                      )Moore
      Haven Commons, Ltd.
                      
                      
                      896,963
                      
                      
                      
                      73,645
                      
                      
                      
                      1,199,226
                      
                      
                      
                      (792,337
                      )NP-89
      Limited Dividend Housing Association Limited Partnership
                      
                      
                      2,895,016
                      
                      
                      
                      150,000
                      
                      
                      
                      7,987,623
                      
                      
                      
                      (4,949,362
                      )Nash
      Hill Associates, Limited Partnership
                      
                      
                      1,419,789
                      
                      
                      
                      123,876
                      
                      
                      
                      1,797,040
                      
                      
                      
                      (832,089
                      )North
      Calhoun City, L.P.
                      
                      
                      448,576
                      
                      
                      
                      12,000
                      
                      
                      
                      676,338
                      
                      
                      
                      (358,639
                      )Orange
      City Plaza, Limited Partnership
                      
                      
                      372,119
                      
                      
                      
                      53,904
                      
                      
                      
                      1,051,852
                      
                      
                      
                      (526,427
                      )Puerta
      del Mar Limited Partnership
                      
                      
                      2,433,052
                      
                      
                      
                      115,000
                      
                      
                      
                      3,273,573
                      
                      
                      
                      (2,261,005
                      )Purvis
      Heights Properties, L.P.
                      
                      
                      1,110,322
                      
                      
                      
                      47,000
                      
                      
                      
                      1,602,756
                      
                      
                      
                      (757,323
                      )Queen
      Lane Investors
                      
                      
                      1,884,424
                      
                      
                      
                      60,301
                      
                      
                      
                      2,841,369
                      
                      
                      
                      (1,729,552
                      )Somerset
      Manor, Ltd.
                      
                      
                      868,979
                      
                      
                      
                      53,383
                      
                      
                      
                      1,132,970
                      
                      
                      
                      (736,473
                      )Sugar
      Cane Villas, Ltd.
                      
                      
                      3,200,620
                      
                      
                      
                      58,500
                      
                      
                      
                      4,093,772
                      
                      
                      
                      (2,694,248
                      )Summerfield
      Apartments Limited Partnership
                      
                      
                      1,441,951
                      
                      
                      
                      195,411
                      
                      
                      
                      2,829,678
                      
                      
                      
                      (1,184,884
                      )Sydney
      Engel Associates L.P.
                      
                      
                      15,270,199
                      
                      
                      
                      284,305
                      
                      
                      
                      20,403,211
                      
                      
                      
                      (13,008,966
                      )Union
      Valley Associates Limited Partnership
                      
                      
                      1,400,527
                      
                      
                      
                      97,800
                      
                      
                      
                      1,758,877
                      
                      
                      
                      (799,753
                      )Walnut
      Grove Family, L.P.
                      
                      
                      821,643
                      
                      
                      
                      30,000
                      
                      
                      
                      1,128,222
                      
                      
                      
                      (612,532
                      )Waynesboro
      Apartments Limited Partnership
                      
                      
                      1,431,989
                      
                      
                      
                      76,000
                      
                      
                      
                      1,794,917
                      
                      
                      
                      (839,441
                      )West
      Calhoun City, L.P.
                      
                      
                      672,387
                      
                      
                      
                      18,000
                      
                      
                      
                      1,197,295
                      
                      
                      
                      (599,851
                      )Westminster
      Apartments Limited Partnership
                      
                      
                      1,607,972
                      
                      
                      
                      51,651
                      
                      
                      
                      1,281,736
                      
                      
                      
                      (1,152,440
                      )$
                      75,984,949
                      
                      
                      $
                      3,710,215
                      
                      
                      $
                      112,260,449
                      
                      
                      $
                      (66,823,930
                      )




39


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships (continued)





Property
information for each Local Partnership as of December 31, 2007 is as
follows:





Name of Local Partnership
                      
                      Mortgage
                        loans payable
                      
                      
                      Land
                      
                      
                      Buildings and
                        improvements
                      
                      
                      Accumulated
                        depreciationApril
      Gardens Apartments II Limited Partnership
                      
                      $
                      1,940,817
                      
                      
                      $
                      39,984
                      
                      
                      $
                      2,554,215
                      
                      
                      $
                      (1,710,647
                      )Ashland
      Park Apartments, L.P.
                      
                      
                      1,007,252
                      
                      
                      
                      50,160
                      
                      
                      
                      1,276,935
                      
                      
                      
                      (785,001
                      )Auburn
      Family, L.P.
                      
                      
                      444,579
                      
                      
                      
                      20,000
                      
                      
                      
                      666,684
                      
                      
                      
                      (306,420
                      )Batesville
      Family, L.P.
                      
                      
                      1,402,915
                      
                      
                      
                      52,000
                      
                      
                      
                      1,882,647
                      
                      
                      
                      (941,357
                      )Bay
      Springs Elderly, L.P.
                      
                      
                      657,811
                      
                      
                      
                      38,000
                      
                      
                      
                      933,986
                      
                      
                      
                      (451,636
                      )Brisas
      del Mar Apartments Limited Partnership
                      
                      
                      2,571,899
                      
                      
                      
                      100,280
                      
                      
                      
                      3,488,197
                      
                      
                      
                      (2,306,527
                      )Bruce
      Housing Associates, L.P.
                      
                      
                      1,071,790
                      
                      
                      
                      16,000
                      
                      
                      
                      1,630,448
                      
                      
                      
                      (915,851
                      )Chestnut
      Park Associates, L.P.
                      
                      
                      4,461,175
                      
                      
                      
                      781,700
                      
                      
                      
                      8,693,011
                      
                      
                      
                      (5,264,153
                      )Chowan
      Senior Manor Associates Limited Partnership
                      
                      
                      1,203,845
                      
                      
                      
                      86,101
                      
                      
                      
                      1,578,917
                      
                      
                      
                      (971,012
                      )Christian
      Street Commons Associates
                      
                      
                      536,317
                      
                      
                      
                      —
                      
                      
                      
                      7,545
                      
                      
                      
                      (2,455
                      )Country
      View Apartments
                      
                      
                      910,551
                      
                      
                      
                      35,698
                      
                      
                      
                      1,289,750
                      
                      
                      
                      (522,313
                      )Desarrollos
      de Belen Limited Partnership
                      
                      
                      1,827,079
                      
                      
                      
                      96,190
                      
                      
                      
                      2,519,166
                      
                      
                      
                      (1,290,216
                      )Desarrollos
      de Emaus Limited Partnership
                      
                      
                      3,105,194
                      
                      
                      
                      214,000
                      
                      
                      
                      4,046,102
                      
                      
                      
                      (1,992,899
                      )Ellinwood
      Heights Apartments, L.P.
                      
                      
                      668,470
                      
                      
                      
                      10,000
                      
                      
                      
                      1,009,768
                      
                      
                      
                      (421,737
                      )Fulton
      Street Houses Limited Partnership
                      
                      
                      3,869,930
                      
                      
                      
                      2
                      
                      
                      
                      5,983,089
                      
                      
                      
                      (3,454,435
                      )Hayes
      Run Limited Partnership
                      
                      
                      1,385,839
                      
                      
                      
                      85,060
                      
                      
                      
                      1,694,620
                      
                      
                      
                      (731,324
                      )Howard
      L. Miller Sallisaw Apartments II, L.P.
                      
                      
                      599,282
                      
                      
                      
                      39,000
                      
                      
                      
                      802,984
                      
                      
                      
                      (307,250
                      )Hurlock
      Meadow Limited Partnership
                      
                      
                      1,232,292
                      
                      
                      
                      49,525
                      
                      
                      
                      1,639,842
                      
                      
                      
                      (976,382
                      )Ivy
      Family, L.P.
                      
                      
                      742,126
                      
                      
                      
                      11,000
                      
                      
                      
                      1,229,842
                      
                      
                      
                      (675,888
                      )Justin
      Associates
                      
                      
                      2,098,457
                      
                      
                      
                      27,472
                      
                      
                      
                      4,372,042
                      
                      
                      
                      (2,548,404
                      )LaBelle
      Commons, Ltd.
                      
                      
                      983,627
                      
                      
                      
                      98,947
                      
                      
                      
                      1,263,737
                      
                      
                      
                      (684,544
                      )Lawrence
      Road Properties, Ltd.
                      
                      
                      737,825
                      
                      
                      
                      50,000
                      
                      
                      
                      982,221
                      
                      
                      
                      (485,093
                      )Loma
      Del Norte Limited Partnership
                      
                      
                      1,398,854
                      
                      
                      
                      84,874
                      
                      
                      
                      1,956,291
                      
                      
                      
                      (833,781
                      )Long
      Reach Associates Limited Partnership
                      
                      
                      1,438,440
                      
                      
                      
                      118,446
                      
                      
                      
                      1,939,212
                      
                      
                      
                      (867,365
                      )Mirador
      del Toa Limited Partnership
                      
                      
                      1,822,423
                      
                      
                      
                      105,000
                      
                      
                      
                      2,374,461
                      
                      
                      
                      (1,587,968
                      )Moore
      Haven Commons, Ltd.
                      
                      
                      901,752
                      
                      
                      
                      73,645
                      
                      
                      
                      1,199,226
                      
                      
                      
                      (750,140
                      )NP-89
      Limited Dividend Housing Association Limited Partnership
                      
                      
                      3,096,140
                      
                      
                      
                      150,000
                      
                      
                      
                      7,897,442
                      
                      
                      
                      (4,639,591
                      )Nash
      Hill Associates, Limited Partnership
                      
                      
                      1,427,370
                      
                      
                      
                      123,876
                      
                      
                      
                      1,781,667
                      
                      
                      
                      (780,485
                      )North
      Calhoun City, L.P.
                      
                      
                      455,102
                      
                      
                      
                      12,000
                      
                      
                      
                      670,388
                      
                      
                      
                      (343,399
                      )Orange
      City Plaza, Limited Partnership
                      
                      
                      382,467
                      
                      
                      
                      53,904
                      
                      
                      
                      1,051,852
                      
                      
                      
                      (501,977
                      )Puerta
      del Mar Limited Partnership
                      
                      
                      2,447,306
                      
                      
                      
                      115,000
                      
                      
                      
                      3,247,655
                      
                      
                      
                      (2,119,365
                      )Purvis
      Heights Properties, L.P.
                      
                      
                      1,116,418
                      
                      
                      
                      47,000
                      
                      
                      
                      1,589,723
                      
                      
                      
                      (722,590
                      )Queen
      Lane Investors
                      
                      
                      1,647,041
                      
                      
                      
                      60,301
                      
                      
                      
                      2,841,369
                      
                      
                      
                      (1,729,552
                      )Somerset
      Manor, Ltd.
                      
                      
                      873,408
                      
                      
                      
                      53,383
                      
                      
                      
                      1,130,381
                      
                      
                      
                      (694,719
                      )Sugar
      Cane Villas, Ltd.
                      
                      
                      3,217,284
                      
                      
                      
                      58,500
                      
                      
                      
                      4,093,772
                      
                      
                      
                      (2,548,464
                      )Summerfield
      Apartments Limited Partnership
                      
                      
                      1,488,833
                      
                      
                      
                      195,411
                      
                      
                      
                      2,790,670
                      
                      
                      
                      (1,113,291
                      )Sydney
      Engel Associates L.P.
                      
                      
                      15,460,803
                      
                      
                      
                      284,305
                      
                      
                      
                      20,286,434
                      
                      
                      
                      (12,240,962
                      )Union
      Valley Associates Limited Partnership
                      
                      
                      1,407,722
                      
                      
                      
                      97,800
                      
                      
                      
                      1,758,877
                      
                      
                      
                      (756,799
                      )Walnut
      Grove Family, L.P.
                      
                      
                      825,870
                      
                      
                      
                      30,000
                      
                      
                      
                      1,117,674
                      
                      
                      
                      (582,642
                      )Waynesboro
      Apartments Limited Partnership
                      
                      
                      1,439,826
                      
                      
                      
                      76,000
                      
                      
                      
                      1,794,917
                      
                      
                      
                      (795,610
                      )West
      Calhoun City, L.P.
                      
                      
                      688,096
                      
                      
                      
                      18,000
                      
                      
                      
                      1,182,875
                      
                      
                      
                      (568,170
                      )Westminster
      Apartments Limited Partnership
                      
                      
                      1,607,972
                      
                      
                      
                      51,651
                      
                      
                      
                      1,253,506
                      
                      
                      
                      (1,074,703
                      )$
                      76,602,199
                      
                      
                      $
                      3,710,215
                      
                      
                      $
                      111,504,140
                      
                      
                      $
                      (62,997,117
                      )


40


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





5.
            Investment
      in Local Partnerships (continued)





The
summary of property activity during the year ended December 31, 2008 is as
follows:





Balance as of
                    December 31, 2007
                
                
                Net change
                    during the year
                    ended
                    December 31, 2008
                
                
                Balance as of
                    December 31, 2008Land
                
                $
                3,710,215
                
                
                $
                —
                
                
                $
                3,710,215Buildings
      and improvements
                
                
                111,504,140
                
                
                
                756,309
                
                
                
                112,260,449115,214,355
                
                
                
                756,309
                
                
                
                115,970,664Accumulated
      depreciation
                
                
                (62,997,117
                )
                
                
                3,826,813
                
                
                
                (66,823,930
                )$
                52,217,238
                
                
                $
                (3,070,504
                )
                
                $
                49,146,734





The
Partnership’s investment in NP-89 represents more then 20% of the Partnership’s
total assets as of March 30, 2009 and 2008.  The following financial
information represents certain balance sheet and operating statement data of
NP-89 as of and for the years ended December 31, 2008 and 2007:





2008
                
                
                2007Total
      assets
                
                $
                3,587,024
                
                
                $
                3,750,242Total
      liabilities
                
                $
                2,988,368
                
                
                $
                3,177,205Revenue
                
                $
                1,291,259
                
                
                $
                1,261,636Net
      income (loss)
                
                $
                25,619
                
                
                $
                (52,735
                )





6.
            Transactions
      with General Partner and Affiliates





For the
years ended March 30, 2009, 2008 and 2007, the Partnership paid and/or incurred
the following amounts to the General Partner and/or affiliates in connection
with services provided to the Partnership:





2009
                
                
                2008
                
                
                2007Paid
                
                
                Incurred
                
                
                Paid
                
                
                Incurred
                
                
                Paid
                
                
                IncurredManagement
      fees (see Note 8)
                
                $
                214,000
                
                
                $
                220,825
                
                
                $
                100,000
                
                
                $
                221,540
                
                
                $
                159,334
                
                
                $
                228,313Administration
      fees (see Note 8)
                
                
                14,226
                
                
                
                220,825
                
                
                
                15,517
                
                
                
                221,540
                
                
                
                15,553
                
                
                
                228,313





For the
years ended December 31, 2008, 2007 and 2006, certain Local Partnerships paid
and/or incurred the following amounts to the General Partner and/or affiliates
in connection with services provided to such Local Partnerships:





2008
                
                
                2007
                
                
                2006Paid
                
                
                Incurred
                
                
                Paid
                
                
                Incurred
                
                
                Paid
                
                
                IncurredProperty
      management fees
                
                $
                44,607
                
                
                $
                45,598
                
                
                $
                42,128
                
                
                $
                40,010
                
                
                $
                42,371
                
                
                $
                40,010




41





AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





7.
            Taxable
      Loss





A
reconciliation of the financial statement net loss of the Partnership for the
years ended March 30, 2009, 2008 and 2007 to the tax return loss for the years
ended December 31, 2008, 2007 and 2006 is as follows:





2009
                
                
                2008
                
                
                2007Financial
      statement net loss for the years ended March 30, 2009, 2008 and
      2007
                
                $
                (474,101
                )
                
                $
                (551,682
                )
                
                $
                (431,945
                )Add
      (less) net transactions occurring betweenJanuary
      1, 2006 and March 30, 2006
                
                
                —
                
                
                
                —
                
                
                
                (124,512
                )January
      1, 2007 and March 30, 2007
                
                
                —
                
                
                
                17,889
                
                
                
                (17,889
                )January
      1, 2008 and March 30, 2008
                
                
                (125,165
                )
                
                
                125,165
                
                
                
                —January
      1, 2009 and March 30, 2009
                
                
                120,348
                
                
                
                —
                
                
                
                —Adjusted
      financial statement net loss for the years ended December 31, 2008, 2007
      and 2006
                
                
                (478,918
                )
                
                
                (408,628
                )
                
                
                (574,346
                )Adjustment
      to management and administration fees pursuant to Internal Revenue Code
      Section 267
                
                
                327,562
                
                
                
                327,560
                
                
                
                145,148Differences
      arising from equity in loss of investment in local
      partnerships
                
                
                (1,850,619
                )
                
                
                (2,617,547
                )
                
                
                (2,538,962
                )Differences
      in gain on disposal of limited partner interests/local partnership
      properties
                
                
                —
                
                
                
                248,246
                
                
                
                —Other
      income from local partnerships
                
                
                (36,063
                )
                
                
                (15,698
                )
                
                
                (30,847
                )Nondeductible
      flow through expenses
                
                
                39
                
                
                
                —
                
                
                
                —Other
      differences
                
                
                1,988
                
                
                
                (748
                )
                
                
                (238
                )Tax
      return loss for the years ended December 31, 2008, 2007 and
      2006
                
                $
                (2,036,011
                )
                
                $
                (2,466,815
                )
                
                $
                (2,999,245
                )





The
differences between the investment in local partnerships for tax and financial
reporting purposes as of December 31, 2008 and 2007 are as follows:





2008
                
                
                2007Investment
      in local partnerships - financial reporting
                
                $
                529,970
                
                
                $
                504,607Investment
      in local partnerships - tax
                
                
                (25,445,556
                )
                
                
                (23,584,237
                )$
                25,975,526
                
                
                $
                24,088,844





Payable
to general partner and affiliates in the accompanying balance sheets represents
accrued management and administrative fees not deductible for tax purposes
pursuant to Internal Revenue Code Section 267.


42


AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





8.
            Commitments
      and Contingencies





Pursuant
to the Partnership Agreement, the Partnership incurs an annual management fee
(the “Management Fee”) and an annual additional management fee (the “Additional
Management Fee”) payable to the General Partner for its services in connection
with the management of the affairs of the Partnership.  The annual
Management Fee is equal to .14% of all proceeds as of December 31 of any year,
invested or committed for investment in Local Partnerships plus all debts of the
Local Partnerships related to the Properties ("Invested Assets").  The
Partnership incurred a Management Fee of $154,578, $155,078, and $159,819 for
the years ended March 30, 2009, 2008 and 2007, respectively.  The
annual Additional Management Fee is equal to .06% of Invested
Assets.  The Partnership incurred an Additional Management Fee of
$66,247, $66,462 and $68,494 for the years ended March 30, 2009, 2008 and 2007,
respectively.  Such amounts are aggregated and reflected under the
caption management fees - affiliate in the accompanying statements of
operations.  Unpaid Management Fees and Additional Management Fees in
the cumulative amount of $1,362,803 and $1,355,978 are included in payable to
general partner and affiliates in the accompanying balance sheets as of March
30, 2009 and 2008, respectively.





In
addition, pursuant to the Partnership Agreement, the Partnership is authorized
to contract for administrative services provided to the
Partnership.  From the inception of the Partnership through November
23, 1999, such administrative services were provided by ML Fund Administrators
Inc. (“MLFA”), an affiliate of the Selling Agent, pursuant to an Administrative
Services Agreement.  MLFA resigned the performance of its basic
services under the Administrative Services Agreement effective November 23,
1999, with certain transitional services continued through April 30,
2000.  The General Partner transitioned the administrative services to
an affiliate of the General Partner without any changes to the terms of the
Administrative Services Agreement.  Pursuant to such agreement, the
Partnership incurs an annual administration fee (the “Administration Fee”) and
an annual additional administration fee (the “Additional Administration Fee”)
for administrative services provided to the Partnership.  The
Partnership incurred an Administration Fee of $154,578, $155,078, and $159,819
for the years ended March 30, 2009, 2008 and 2007,
respectively.    The annual Additional Administration Fee is
equal to .06% of Invested Assets.  The Partnership incurred an
Additional Administration Fee of $66,247, $66,462 and $68,494 for the years
ended March 30, 2009, 2008 and 2007, respectively.  Such amounts are
aggregated and reflected under the caption administration fees - affiliate in
the accompanying statements of operations.  Unpaid Administration Fees
and Additional Administration Fees due to MLFA in the cumulative amount of
$440,673 are included in accounts payable and accrued expenses in the
accompanying balance sheets as of March 30, 2009 and 2008.  Unpaid
Administration Fees and Additional Administration Fees due to an affiliate of
the General Partner in the cumulative amount of $1,571,916 and $1,365,317 are
included in due to general partner and affiliates in the accompanying balance
sheets as of March 30, 2009 and 2008, respectively.





The
amount reflected above as due to MLFA and certain amounts due to the General
Partner and affiliates are payable pursuant to the terms of an agreement between
the Partnership, the General Partner and MLFA (the “Deferred Fee
Agreement”).  Such amounts are payable to the extent proceeds from the
sales of limited partner interests/local partnership properties become
available, as described in the Deferred Fee Agreement.





9.
            Fair
      Value of Financial Instruments





The
following disclosure of the estimated fair value of financial instruments is
made in accordance with the requirements of SFAS No. 107, "Disclosures about
Fair Value of Financial Instruments."  The estimated fair value
amounts have been determined using available market information, assumptions,
estimates and valuation methodologies.





Cash andCashEquivalents





The
carrying amount approximates fair value.





Investments inBonds





Fair
value is estimated based on market quotes provided by an independent service as
of the balance sheet dates.





The
estimated fair value of the Partnership's financial instruments as of March 30,
2009 and 2008 are disclosed elsewhere in the financial statements.


43




AMERICAN
TAX CREDIT PROPERTIES III L.P.


NOTES
TO FINANCIAL STATEMENTS - (Continued)


MARCH
30, 2009, 2008 AND 2007





10.
            Quarterly
      Financial Information - Unaudited





The
following is a summary of results of operations for each of the four quarters
for the years indicated:





First
                      
                      
                      Second
                      
                      
                      Third
                      
                      
                      FourthQuarter
                      
                      
                      Quarter
                      
                      
                      Quarter
                      
                      
                      Quarter2009Total
      revenue
                      
                      $
                      30,060
                      
                      
                      $
                      6,863
                      
                      
                      $
                      3,209
                      
                      
                      $
                      20,680Total
      expenses
                      
                      
                      (146,869
                      )
                      
                      
                      (134,401
                      )
                      
                      
                      (137,978
                      )
                      
                      
                      (144,528
                      )Equity
      in income (loss) of investment in local partnerships
                      
                      
                      (13,614
                      )
                      
                      
                      (1,661
                      )
                      
                      
                      52,895
                      
                      
                      
                      (12,257
                      )Gain
      on disposal of limited partner interests/local partnership
      properties
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      3,500Net
      loss
                      
                      
                      (130,423
                      )
                      
                      
                      (129,199
                      )
                      
                      
                      (81,874
                      )
                      
                      
                      (132,605
                      )Net
      loss per unit of limited partnership interest
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —2008Total
      revenue
                      
                      $
                      26,521
                      
                      
                      $
                      17,450
                      
                      
                      $
                      16,344
                      
                      
                      $
                      22,506Total
      expenses
                      
                      
                      (142,623
                      )
                      
                      
                      (133,311
                      )
                      
                      
                      (143,514
                      )
                      
                      
                      (147,671
                      )Equity
      in income (loss) of investment in local partnerships
                      
                      
                      1,563
                      
                      
                      
                      23,786
                      
                      
                      
                      5,841
                      
                      
                      
                      (98,574
                      )Net
      loss
                      
                      
                      (114,539
                      )
                      
                      
                      (92,075
                      )
                      
                      
                      (121,329
                      )
                      
                      
                      (223,739
                      )Net
      loss per unit of limited partnership interest
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —
                      
                      
                      
                      —




44


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





None.





Item
9A.  Controls and
Procedures.





Disclosure
controls and procedures are controls and procedures that are designed to ensure
that information required to be disclosed by Registrant in reports that
Registrant files or submits under the Exchange Act is recorded, processed,
summarized and timely reported as provided in SEC rules and
forms.  Registrant periodically reviews the design and effectiveness
of its disclosure controls and procedures, including compliance with various
laws and regulations that apply to its operations.  Registrant makes
modifications to improve the design and effectiveness of its disclosure controls
and procedures, and may take other corrective action, if its reviews identify a
need for such modifications or actions.  In designing and evaluating
the disclosure controls and procedures, Registrant recognizes that any controls
and procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving the desired control objectives.




Registrant
has carried out an evaluation, under the supervision and the participation of
its management, including the Chief Executive Officer and Chief Financial
Officer of Richman Housing, of the effectiveness of the design and operation of
its disclosure controls and procedures (as defined in
Rule 13a-15(e) and 15d-15(e) under the Exchange Act), as of the
year ended March 30, 2009.  Based upon that evaluation, the Chief
Executive Officer and Chief Financial Officer of Richman Housing concluded that
Registrant’s disclosure controls and procedures were effective as of
March 30, 2009.





Item
9A(T).  Management’s Annual Report
on Internal Control over Financial Reporting.





Management’s Annual Report
on Internal Control Over Financial Reporting





Registrant
is responsible for establishing and maintaining adequate internal control over
financial reporting, as such term is defined in Exchange Act
Rule 13a-15(f).  Under the supervision and with the participation
of its management, including the Chief Executive Officer and Chief Financial
Officer of Richman Housing, Registrant conducted an evaluation of the
effectiveness of its internal control over financial reporting based on the
framework set forth in Internal Control - Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission.  Based on its evaluation, management has
concluded that Registrant’s internal control over financial reporting was
effective as of March 30, 2009.




This
Annual Report does not include an attestation report of Registrant’s independent
registered public accounting firm regarding internal control over financial
reporting.  Management’s report was not subject to attestation by
Registrant’s independent registered public accounting firm pursuant to temporary
rules of the SEC that permit Registrant to provide only management’s report
in this Annual Report.





Changes in Internal Control
Over Financial Reporting





There
were no changes in Registrant’s internal control over financial reporting during
the three months ended March 30, 2009 that have materially affected, or are
reasonably likely to materially affect, Registrant’s internal control over
financial reporting.





Item
9B.   Other
Information.





None.


45


PART
III





Item
10. Directors and Executive
Officers of the Registrant.





Registrant
has no officers or directors.  The General Partner manages
Registrant's affairs and has general responsibility and authority in all matters
affecting its business.  The responsibilities of the General Partner
are currently carried out by Richman Housing.  The executive officers
and director of Richman Housing are:





Served in presentName
                
                capacity since1
                
                Position heldRichard
      Paul Richman
                
                September
      21, 1989
                
                DirectorDavid
      A. Salzman
                
                February
      1, 2001
                
                PresidentJames
      Hussey
                
                January
      20, 2009
                
                Vice
      President and TreasurerGina
      K. Dodge
                
                September
      21, 1989
                
                SecretaryCharles
      L. Krafnick
                
                February
      1, 2001
                
                Assistant
      Treasurer





1Director
holds office until his successor is elected and qualified.  All
officers serve at the pleasure of the Director.





Richard Paul Richman, age 61,
is the sole Director of Richman Housing.  Mr. Richman is the Chairman
and a stockholder of Richman Group.  Mr. Richman is involved in the
syndication, development and management of residential property.  Mr.
Richman is also a director of Wilder Richman Resources Corp., an affiliate of
Richman Housing and the general partner of Secured Income L.P., a director of
Wilder Richman Historic Corporation, an affiliate of Richman Housing and the
general partner of Wilder Richman Historic Properties II, L.P., a director of
Richman Tax Credit Properties Inc., an affiliate of Richman Housing and the
general partner of the general partner of American Tax Credit Properties L.P., a
director of Richman Tax Credits Inc., an affiliate of Richman Housing and the
general partner of the general partner of American Tax Credit Properties II L.P.
and a director of Richman American Credit Corp., an affiliate of Richman Housing
and the manager of American Tax Credit Trust, a Delaware statutory business
trust.





David A. Salzman,age 48, is
the President of Richman Housing and is a stockholder and the President of
Richman Group.  Mr. Salzman has been employed by Richman Group or an
affiliate since 1986 and is responsible for the acquisition of residential real
estate for syndication for Richman Group.





James Hussey, age 48, is a
Vice President and Treasurer of Richman Housing.  Mr. Hussey, the
Treasurer of Richman Group, is engaged primarily in the syndication and finance
operations of Richman Group.  In addition, Mr. Hussey is a Vice
President and the Treasurer of Richman Asset Management, Inc. (“RAM”), an
affiliate of Richman Housing.  Mr. Hussey’s is engaged primarily in
the partnership management and finance operations of RAM.  Prior to
joining RAM, Mr. Hussey, a Certified Public Accountant, was the Chief Financial
Officer of WCI Communities Inc. NE Region and Spectrum Communities,
LLC.  From 1989 to 1998, Mr. Hussey held various positions with Center
Development Corp, a developer of affordable housing in the New York metropolitan
area.





Gina K. Dodge, age 53, is the
Secretary of Richman Housing and is a Vice President and the Secretary of
Richman Group.  Ms. Dodge has been employed by Richman Group or an
affiliate since 1988 and, as the Director of Investor Services, is responsible
for communications with investors.





Charles L. Krafnick, age 47,
is the Assistant Treasurer of Richman Housing and is the Assistant Treasurer of
Richman Group.  Mr. Krafnick has been employed by Richman Group or an
affiliate since 1994 and is engaged primarily in the finance operations of
Richman Group.  In addition, Mr. Krafnick is the Assistant Treasurer of
RAM.  Mr. Krafnick's responsibilities in connection with RAM include
various finance and partnership management functions.





Effective
January 14, 2009, Neal Ludeke resigned his positions as Vice President and
Treasurer of Richman Housing.





Registrant
is not aware of any family relationship between the director and executive
officers listed in this Item 10.





Registrant
is not aware of the involvement in certain legal proceedings with respect to the
director and executive officers listed in this Item 10.







46





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





The Board
of Director of Richman Housing has adopted a code of ethics for senior financial
officers of the Registrant, applicable to Registrant's principal executive
officer, principal financial officer and comptroller or principal accounting
officer, or persons performing similar functions.  Registrant will
provide to any person without charge a copy of such code of ethics upon written
request to the General Partner at 340 Pemberwick Road, Greenwich, Connecticut
06831, Attention: Secretary.





Item
11.  Executive
Compensation.





Registrant
has no officers or directors.  Registrant does not pay or accrue any
fees, salaries or other forms of compensation to the officers or director of
Richman Housing and did not pay any such compensation during the year ended
March 30, 2009 or during the prior two fiscal years.  During the year
ended March 30, 2009 and during the prior two fiscal years, Richman Housing did
not pay any compensation to any of its officers or its director.  The
director and certain officers of Richman Housing receive compensation from
certain affiliates of Richman Housing for services performed for various
affiliated entities which may include services performed for
Registrant.





Under the
terms of the Partnership Agreement, Registrant has entered into certain
arrangements with the General Partner and certain of its affiliates which
provide for compensation to be paid to the General Partner and certain of its
affiliates.  See Notes 6 and 8 to the audited financial statements
included in Item 8 - “Financial Statements and Supplementary Data” of this
Annual Report.





Tabular
information concerning salaries, bonuses and other types of compensation payable
to executive officers has not been included in this Annual Report.  As
noted above, Registrant has no executive officers.  The levels of
compensation payable to the General Partner and/or its affiliates is limited by
the terms of the Partnership Agreement and may not be increased therefrom on a
discretionary basis.





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





JJJ Fund,
LLC and an affiliate, having the mailing address 7463 E. Beryl, Scottsdale,
Arizona 85258 are the owners of 2,788 Units, representing approximately 7.8% of
all such Units.  Prizm Investments and certain affiliates thereof,
having the mailing address P.O. Box 47638, Phoenix, Arizona 85068 are the owners
of 2,619 Units, representing approximately 7.3% of all such Units.  As
of December 31, 2008, no person or entity, other than the entities and
affiliates identified above herein Item 12, was known by Registrant to be the
beneficial owner of more than five percent of the Units.





Neither
the General Partner, Richman Housing nor the director or any officer of Richman
Housing own any Units.  Richman Housing is wholly owned by Richard
Paul Richman.





Item
13.  Certain
Relationships and Related Transactions and Director
Independence.





Transactions with Related
Persons





The
General Partner and certain of its affiliates are entitled to receive certain
fees and reimbursement of expenses and have received/earned fees for services
provided to Registrant as described in Notes 6 and 8 to the audited financial
statements included in Item 8 - "Financial Statements and Supplementary Data"
herein.  Such fees continue to be incurred by Registrant during the
fiscal year ending March 30, 2010.





The
taxable loss generated by Registrant during the years ended December 31, 2008
and 2007 allocated to the General Partner was $20,361 and $24,668,
respectively.  The taxable loss generated by the General Partner
during the years ended December 31, 2008 and 2007 (from the allocation of
Registrant discussed above) and allocated to Richman Housing was $16,461 and
$19,939, respectively.





Review, Approval or
Ratification of Transactions with Related Parties





Pursuant
to the terms of the Partnership Agreement, Registrant has specific
rights and limitations in conducting business with the General Partner and
affiliates.  To date, Registrant has followed such provisions of
the Partnership Agreement.  Registrant's unwritten
policies for transacting business with related parties are
to first refer to the Partnership Agreement in connection
with conducting such business or making payments and then,
if circumstances arise for which a new related party
transaction is contemplated, present the proposed
transaction to certain officers of Richman Housing for review and
approval.  If any matter in connection with such transaction might be
unclear under the terms of the Partnership Agreement, such matter is
presented to general or outside counsel for review prior
to any such transaction being entered into by
Registrant.


47


Item
13.  Certain
Relationships and Related Transactions and Director Independence
(continued).





Indebtedness of
Management.





No
officer or director of Richman Housing or any affiliate of the foregoing was
indebted to Registrant at any time during the years ended March 30, 2009 and
2008.





Item
14.  Principal Accountant Fees
and Services.





Registrant’s
independent registered public accounting firm billed Registrant the following
fees for professional services rendered in the years ended March 30, 2009 and
2008:





2009
                    
                    
                    2008Audit
      Fees
                    
                    $
                    45,000
                    
                    
                    $
                    50,250Audit-Related
      Fees
                    
                    
                    —
                    
                    
                    
                    —Tax
      Fees
                    
                    $
                    15,000
                    
                    
                    $
                    10,500All
      Other Fees
                    
                    
                    —
                    
                    
                    
                    —





Audit
fees consist of fees for the annual audit and review of Registrant’s financial
statements and assistance with and review of documents filed with the
SEC.  Tax fees generally represent fees for annual tax return
preparation.  There were no other accounting fees incurred by
Registrant in fiscal 2009 and 2008.





The Audit
Committee has adopted a set of pre-approval policies and procedures under which,
pursuant to the requirements of the Sarbanes-Oxley Act of 2002, all audit and
permitted non-audit services to be performed by the independent registered
public accounting firm require pre-approval by the Audit Committee.





The Audit
Committee approved all fiscal 2009 and 2008 principal accountant fees and
services.





48




PART
IV





Item
15. Exhibits and Financial
Statement Schedules.





(a)
Financial Statements,
Financial Statement Schedules and Exhibits





(1)  Financial
Statements





See Item
8 - "Financial Statements and Supplementary Data."





(2)  Financial Statement
Schedules





No
financial statement schedules are included because of the absence of the
conditions under which they are required or because the information is included
in the financial statements or the notes thereto.





(3)  Exhibits





Incorporated byExhibit
                                      
                                      Reference to4.1
                                      
                                      Amended
      and Restated Agreement of Limited Partnership of
Registrant
                                      
                                      Exhibit
      A to Registrant’s Prospectus filed February 15, 1990(File
      No. 33-31390)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 forthe
      period ended 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 for the year ended 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 forthe
      period ended December 30, 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 forthe
      period ended 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 forthe
      period ended December 30, 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 forthe
      period ended 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 for the period ended 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 Reportfor
      the year ended March 30, 1992(File
      No. 33-31390)


49




Incorporated byExhibit
                                          
                                          Reference to10.9
                                          
                                          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 for the period ended 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 for the period ended December 30, 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 for the period ended 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 for the period ended 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 for the period ended 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 for the period ended 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 for the year ended 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 for the year ended 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 for the year ended 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 for the year ended 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 for the year ended 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 for the period ended June 29, 1991(File No.
      0-19217)
 
 50
 
 Incorporated byExhibit
                                            
                                            Reference to10.21
                                            
                                            Fulton
      Street Houses Limited Partnership Amended and Restated Agreement of
      Limited Partnership
                                            
                                            Exhibit
      10.21 to Form 10-K Report for the year ended 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 for the period ended 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 for the year ended 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 for the year ended 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 for the period ended 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 for the period ended December 30, 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 for the period ended 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 for the year ended 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 for the year ended 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 for the period ended 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 for the period ended December 30, 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 for the period ended 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 for the year ended March 30, 1991(File No.
      33-31390)
  51
 
 Incorporated byExhibit
                                            
                                            Reference to10.34
                                            
                                            Mirador
      del Toa Limited Partnership Amended and Restated Agreement of Limited
      Partnership
                                            
                                            Exhibit
      10.16 to Form 10-K Report for the year ended 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 for the year ended 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 for the period ended 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 for the period ended 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 for the year ended 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 for the period ended 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 for the year ended 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 for the period ended 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 for the period ended 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 for the period ended December 30, 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 for the period ended 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 for the period ended 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 for the year ended March 30, 1991(File No.
      33-31390)
  52
 
 Incorporated byExhibit
                                          
                                          Reference to10.47
                                          
                                          Summerfield
      Apartments Limited Partnership Amended and Restated Agreement of Limited
      Partnership
                                          
                                          Exhibit
      10.47 to Form 10-K Report for the year ended 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 for the year ended 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 for the period ended 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 for the year ended 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 for the year ended 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 for the year ended 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 for the year ended 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 for the period ended 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 for the period ended 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 for the period ended 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 for the period ended 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 for the year ended March 30, 1992(File No.
      33-31390)
  53
 
 Incorporated byExhibit
                                            
                                            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 of Prospectus dated February 7, 1990 filed pursuant to Rule
      424(b)(3) under Securities Act of 1933*99.2
                                            
                                            Pages
      44 through 71 of Prospectus dated February 7, 1990 filed pursuant to Rule
      424(b)(3) under Securities Act of 1933*99.3
                                            
                                            Pages
      78 through 80 of Prospectus dated February 7, 1990 filed pursuant to Rule
      424(b)(3) under Securities Act of 1933*99.4
                                            
                                            Pages
      14 through 19 of Prospectus dated February 7, 1990 filed pursuant to Rule
      424(b)(3) under Securities Act of 1933*99.5
                                            
                                            Supplement
      No. 1 dated June 6, 1990 to Prospectus dated February 7, 1990 filed
      pursuant to Rule 424(b)(3) under Securities Act of 1933*99.6
                                            
                                            Supplement
      No. 2 dated November 21, 1990 to Prospectus dated February 7, 1990 filed
      pursuant to Rule 424(b)(3) under Securities Act of 1933*99.7
                                            
                                            Supplement
      No. 3 dated December 20, 1990 to Prospectus dated February 7, 1990 filed
      pursuant to Rule 424(b)(3) under Securities Act of 1933*99.8
                                            
                                            Supplement
      No. 4 dated October 30, 1991 to Prospectus dated February 7, 1990 filed
      pursuant to Rule 424(b)(3) under Securities Act of 1933*99.9
                                            
                                            Supplement
      No. 5 dated December 26, 1991 to Prospectus dated February 7, 1990 filed
      pursuant to Rule 424(b)(3) under Securities Act of 1933
  54
 
 Incorporated byExhibit
                                      
                                      Reference to*99.10
                                      
                                      Supplement
      No. 6 dated January 15, 1992 to Prospectus dated February 7, 1990 filed
      pursuant to Rule 424(b)(3) under Securities Act of 193399.11
                                      
                                      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 for the year ended March 30, 2005(File No.
      0-19217)99.12
                                      
                                      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 for the year ended March 30, 2005(File No.
      0-19217)99.13
                                      
                                      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 Report for the year ended March 30, 2005(File No.
      0-19217)99.14
                                      
                                      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 Report for the year ended March 30, 2006(File No.
      0-19217)99.15
                                      
                                      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 Report for the year ended March 30, 2006(File No.
      0-19217)99.16
                                      
                                      Audited
      Financial Statements of NP-89 Limited Dividend Housing Association Limited
      Partnership as of and for the year ended December 31, 2006
                                      
                                      Exhibit
      99.14 to Form 10-K Report for the year ended March 30, 2007(File No.
      0-19217)99.17
                                      
                                      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, 2007
                                      
                                      Exhibit
      99.15 to Form 10-K Report for the year ended March 30, 2008(File No.
      0-19217)*99.18
                                      
                                      Deferred
      Fee Agreement between Registrant, the General Partner and ML Fund
      Administrators Inc.*99.19
                                      
                                      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, 2008




*Filed
herewith.





(b)
Exhibits





See
(a)(3) above.





(c)
Financial Statement
Schedules





See
(a)(2) above.


55


SIGNATURES





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





AMERICAN
      TAX CREDIT PROPERTIES III L.P.(a
      Delaware limited partnership)By:
                              Richman
      Tax Credit Properties III L.P.,General
      PartnerBy:
                              Richman
      Housing Credits Inc.,general
      partnerDated:  June 29,
      2009
                              /s/David SalzmanDavid
      SalzmanChief
      Executive OfficerDated:  June 29,
      2009
                              /s/James HusseyJames
      HusseyChief
      Financial
Officer





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





Signature
                                          
                                          Title
                                          
                                          Date/s/David Salzman
                                          
                                          Chief
      Executive Officer of  the general
                                          
                                          June 29, 2009(David
      Salzman)
                                          
                                          partner
      of the General Partner/s/James Hussey
                                          
                                          Chief
      Financial Officer of the general
                                          
                                          June 29, 2009(James
      Hussey)
                                          
                                          partner
      of the General Partner/s/Richard Paul Richman
                                          
                                          Director
      of the general partner of the
                                          
                                          June 29, 2009(Richard
      Paul Richman)
                                          
                                          General
      Partner




56