<PAGE>


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


                                    FORM 10-Q

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

 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005

( ) TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

                        Commission File Number: 33-62526

                      COMMONWEALTH INCOME & GROWTH FUND IV
             (Exact name of registrant as specified in its charter)

         Pennsylvania                               23- 3080409
(State or other jurisdiction of          (I.R.S. Employer Identification Number)
 incorporation or organization)

                          470 John Young Way Suite 300
                                 Exton, PA 19341
          (Address, including zip code, of principal executive offices)

                                 (610) 594-9600
               (Registrant's telephone number including area code)

         Indicate by check mark whether the registrant (i) 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, and (ii) has been subject to such filing
requirements for the past 90 days: YES [X] NO [ ]

         Indicate by check mark whether the registrant is an accelerated filer
(as defined in Rule 12c-2 of the Act): YES [ ] NO [X]







<PAGE>


                                    FORM 10-Q
                                 MARCH 31, 2005

                                TABLE OF CONTENTS

                                     PART I

<TABLE>
<CAPTION>

<S>                <C>                                                                 <C>
Item 1.     Condensed Financial Statements                                              3
Item 2.     Management's Discussion and Analysis of Financial Condition and
            Results of Operations                                                      12
Item 3.     Quantitative and Qualitative Disclosures About Market Risk                 15
Item 4.     Controls and Procedures                                                    15

                                           PART II
Item 1.     Legal Proceedings                                                          15
Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds.               16
Item 3.     Defaults Upon Senior Securities                                            16
Item 4.     Submission of Matters to a Vote of Securities Holders                      16
Item 5.     Other Information                                                          16
Item 6.     Index to Exhibits

            Signatures

            Certifications

</TABLE>


<PAGE>



                                  COMMONWEALTH INCOME & GROWTH FUND IV
                                        CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                            MARCH 31,             DECEMBER 31,
                                                              2005                   2004
                                                       ---------------------------------------
                                                           (UNAUDITED)
ASSETS

<S>                                                     <C>                      <C>
Cash and cash equivalents                               $       396,307          $    719,161
Lease income receivable                                               -               157,741
Other receivables - affiliated limited partnerships               3,796                     -
Deferred revenue                                                    631                   913
Refundable deposits                                               2,166                 1,130
                                                       ---------------------------------------

                                                                402,900               878,945
                                                       ---------------------------------------



Computer equipment, at cost                                  15,063,073            14,299,155
Accumulated depreciation                                     (5,236,600)           (4,386,199)
                                                       ---------------------------------------
                                                              9,826,473             9,912,956
                                                       ---------------------------------------

Equipment acquisition costs and deferred expenses, net          346,557               369,202
Other receivables - Commonwealth Capital Corp                   252,796               243,435
Prepaid acquisition fees                                        100,138                98,321
                                                       ---------------------------------------
                                                                699,491               710,958
                                                       ---------------------------------------

TOTAL ASSETS                                           $     10,928,864        $   11,502,859
                                                       =======================================


LIABILITIES AND PARTNERS' CAPITAL

LIABILITIES
Accounts payable, primarily for equipment purchases              65,989               118,403
Accounts payable - other affiliated partnerships                      -               376,552
Accounts payable - General Partner                               21,025                53,075
Accounts payable - Commonwealth Capital Corp.                    29,468                     -
Unearned lease income                                            38,067                60,464
Notes payable                                                 2,268,098             2,035,898
                                                       ---------------------------------------
TOTAL LIABILITIES                                             2,422,647             2,644,392
                                                       ---------------------------------------

PARTNERS' CAPITAL

General partner                                                   1,000                 1,000
Limited partners                                              8,505,217             8,857,467
                                                       ---------------------------------------
TOTAL PARTNERS' CAPITAL                                       8,506,217             8,858,467
                                                       ---------------------------------------

TOTAL LIABILITIES AND PARTNERS' CAPITAL                $     10,928,864        $   11,502,859
                                                       =======================================
</TABLE>

            see accompanying notes to condensed financial statements


<PAGE>




                      COMMONWEALTH INCOME & GROWTH FUND IV
                       CONDENSED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                      THREE MONTHS         THREE MONTHS
                                                          ENDED                 ENDED
                                                        MARCH 31,             MARCH 31,
                                                           2005                 2004
                                                     ------------        -------------
                                                               (UNAUDITED)
<S>                                                    <C>                 <C>
INCOME
Lease                                                  $ 1,252,838         $   967,692
Interest and other                                             551               7,663
                                                      ------------        ------------
TOTAL INCOME                                             1,253,389             975,355
                                                      ------------        ------------

EXPENSES
Operating, excluding depreciation                          157,306             338,370
Equipment management fee - General Partner                  59,986              48,385
Interest                                                    29,253              28,052
Depreciation                                               912,250             686,836
Amortization of equipment
  acquisition costs and deferred expenses                   53,645              41,184
Loss on sale of computer equipment                           8,805               2,919
                                                      ------------        ------------
TOTAL EXPENSES                                           1,221,245           1,145,746
                                                      ------------        ------------



NET INCOME (LOSS)                                      $    32,144          $ (170,391)
                                                       ============        ===========

NET INCOME (LOSS) PER EQUIVALENT LIMITED
  PARTNERSHIP UNIT                                     $      0.04          $    (0.23)
                                                       ============        ===========

WEIGHTED AVERAGE NUMBER OF EQUIVALENT LIMITED
PARTNERSHIP UNITS OUTSTANDING DURING THE PERIOD            749,050             749,950
                                                      ============         ===========
</TABLE>


            see accompanying notes to condensed financial statements


<PAGE>



                      COMMONWEALTH INCOME & GROWTH FUND IV
                    CONDENSED STATEMENTS OF PARTNERS' CAPITAL
<TABLE>
<CAPTION>

                                                                FOR THE THREE MONTHS ENDED MARCH 31, 2005
                                                                               (UNAUDITED)

                                         GENERAL          LIMITED
                                         PARTNER          PARTNER            GENERAL           LIMITED
                                          UNITS            UNITS             PARTNER           PARTNER                   TOTAL
                                       ------------------------------------------------------------------------------------------

<S>                                               <C>         <C>               <C>            <C>                 <C>
PARTNERS' CAPITAL - DECEMBER 31, 2004              50          749,950           $ 1,000        $  8,857,466        $ 8,858,466
                                       -------------------------------------------------  ---------------------------------------
  Net income (loss)                                 -                -             3,748              28,396             32,144
  Redemption                                                                                          (9,617)            (9,617)
  Distributions                                     -                -            (3,748)           (371,028)          (374,776)
                                       -------------------------------------------------- ---------------------------------------
PARTNERS' CAPITAL - MARCH 31, 2005                 50          749,950           $ 1,000        $  8,505,217        $ 8,506,217
                                       ================================  ================ =================== ===================

</TABLE>



            see accompanying notes to condensed financial statements


<PAGE>



                      COMMONWEALTH INCOME & GROWTH FUND IV
                        CONDENSED STATEMENTS OF CASH FLOW
               FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004

<TABLE>
<CAPTION>

                                                                2005                2004
                                                           ----------------------------------
                                                                       (UNAUDITED)

<S>                                                        <C>                 <C>
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES        $   359,990         $  (2,108,215)
                                                           ----------------------------------

INVESTING ACTIVITIES:

Capital expenditures                                          (284,023)             (614,091)
 Acquisition fees                                              (27,132)                    -
Net proceeds from sale of computer equipment                    18,066                55,432

                                                           ----------------------------------
NET CASH (USED IN) INVESTING ACTIVITIES                       (293,089)             (558,659)
                                                           ----------------------------------

FINANCING ACTIVITIES:
Redemptions                                                     (9,617)                    -
Distributions to partners                                     (374,776)             (375,492)
Other receivable, Commonwealth Capital Corp                        324               (83,439)
Debt Placement fee paid to the General Partner                  (5,686)                    -
                                                           ----------------------------------
                                                                                    (458,931)
NET CASH (USED IN)  FINANCING ACTIVITIES                      (389,755)
                                                           ----------------------------------


Net (decrease) increase in cash and cash equivalents          (322,854)           (3,125,805)
Cash and cash equivalents, beginning of period                 719,161             4,644,293
                                                           ----------------------------------
CASH AND CASH EQUIVALENTS, END OF PERIOD                   $   396,307         $   1,518,488
                                                           ==================================

</TABLE>

            see accompanying notes to condensed financial statements




<PAGE>



                     NOTES TO CONDENSED FINANCIAL STATEMENTS

1.      BUSINESS                   Commonwealth Income & Growth Fund IV (the
                                   "Partnership") is a limited partnership
                                   organized in the Commonwealth of Pennsylvania
                                   on May 15, 2001. The Partnership was offering
                                   for sale up to 750,000 units of the limited
                                   partnership at the purchase price of $20 per
                                   unit (the "Offering"). The Partnership
                                   reached the minimum amount in escrow and
                                   commenced operations on July 8, 2002 and was
                                   fully subscribed on September 15, 2003.

                                   The Partnership uses the proceeds of the
                                   Offering to acquire, own and lease various
                                   types of computer peripheral equipment and
                                   other similar capital equipment, which will
                                   be leased primarily to U.S. corporations and
                                   institutions. Commonwealth Capital Corp
                                   ("CCC"), on behalf of the Partnership and
                                   other affiliated partnerships, will acquire
                                   computer equipment subject to associated debt
                                   obligations and lease agreements and allocate
                                   a participation in the cost, debt and lease
                                   revenue to the various partnerships based on
                                   certain risk factors.

                                   The Partnership's General Partner is
                                   Commonwealth Income & Growth Fund, Inc. (the
                                   "General Partner"), a Pennsylvania
                                   corporation which is an indirect wholly owned
                                   subsidiary of CCC. CCC is a member of the
                                   Investment Program Association (IPA),
                                   Financial Planning Association (FPA), and the
                                   Equipment Leasing Association (ELA).
                                   Approximately ten years after the
                                   commencement of operations, the Partnership
                                   intends to sell or otherwise dispose of all
                                   of its computer equipment, make final
                                   distributions to partners, and to dissolve.
                                   Unless sooner terminated, the Partnership
                                   will continue until December 31, 2012.

2.      SUMMARY OF                 BASIS OF PRESENTATION
        SIGNIFICANT
        ACCOUNTING                 The financial information presented as of any
        POLICIES                   date other than December 31 has been prepared
                                   from the books and records without audit.
                                   Financial information as of December 31 has
                                   been derived from the audited financial
                                   statements of the Partnership, but does not
                                   include all disclosures required by generally
                                   accepted accounting principles. In the
                                   opinion of management, all adjustments,
                                   consisting only of normal recurring
                                   adjustments, necessary for a fair
                                   presentation of the financial information for
                                   the periods indicated have been included. For
                                   further information regarding the
                                   Partnership's accounting policies, refer to
                                   the financial statements and related notes
                                   included in the Partnership's annual report
                                   on Form 10-K for the year ended December 31,
                                   2004. Operating results for the three-month
                                   period ended March 31, 2005 are not
                                   necessarily indicative of financial results
                                   that may be expected for the full year ended
                                   December 31, 2005.

<PAGE>

                                   LONG-LIVED ASSETS

                                   The Partnership evaluates its long-lived
                                   assets when events or circumstances indicate
                                   that the value of the asset may not be
                                   recoverable. The Partnership determines
                                   whether an impairment exists by estimating
                                   the undiscounted cash flows to be generated
                                   by each asset. If the estimated undiscounted
                                   cash flows are less than the carrying value
                                   of the asset then an impairment exists. The
                                   amount of the impairment is determined based
                                   on the difference between the carrying value
                                   and the fair value. The fair value is
                                   determined based on estimated discounted cash
                                   flows to be generated by the asset. The
                                   partnership determined that no impairment had
                                   occurred during the three months ended March
                                   31, 2005.

                                   Depreciation on computer equipment for
                                   financial statement purposes is based on the
                                   straight-line method over estimated useful
                                   lives of four years.

                                   NET INCOME (LOSS) PER EQUIVALENT LIMITED
                                   PARTNERSHIP UNIT

                                   The net income (loss) per equivalent limited
                                   partnership unit is computed based upon net
                                   income (loss) allocated to the limited
                                   partners and the weighted average number of
                                   equivalent units outstanding during the
                                   period.

3.      COMPUTER                   The Partnership is the lessor of equipment
        EQUIPMENT                  under operating leases with periods ranging
                                   from 16 to 36 months. In general, the lessee
                                   pays associated costs such as repairs and
                                   maintenance, insurance and property taxes.

                                   Through March 31, 2005, the Partnership has
                                   only entered into operating leases. Lease
                                   revenue is recognized on a monthly basis in
                                   accordance with the terms of the operating
                                   lease agreements.

                                   The Partnership's share of the computer
                                   equipment in which they participate at March
                                   31, 2005 and December 31, 2004 was
                                   approximately $909,000 for both period ends,
                                   which is included in the Partnership's fixed
                                   assets on their balance sheet, and the total
                                   cost of the equipment shared by the
                                   Partnership with other partnerships at March
                                   31, 2005 and December 31, 2004 was
                                   approximately $1,798,000 for both period
                                   ends.

                                   The following is a schedule of future minimum
                                   rentals on noncancellable operating leases at
                                   March 31, 2005:
<TABLE>
<CAPTION>
                                       <S>                                                         <C>

                                                                                                 Amount
                                  -------------------------------------------------------------------------
                                  Nine  Months ended December 31, 2005                        $  3,180,000
                                  Year Ended December 31, 2006                                   3,325,000
                                  Year Ended December 31, 2007                                     693,000
                                  Year Ended December 31, 2008                                      29,000
                                                                                               -----------
                                                                                              $  7,227,000
                                  -------------------------------------------------------------------------

</TABLE>

<PAGE>




4.      RELATED PARTY
        TRANSACTIONS
                               OTHER RECEIVABLES

                               As of March 31, 2005, the Partnership has an
                               unsecured, non-interest bearing receivable from
                               CCC, a related party to the Partnership, in the
                               amount of approximately $253,000, which primarily
                               originated in 2003. CCC, through its indirect
                               subsidiaries, including the General Partner of
                               the Partnership, earns fees based on revenues and
                               new lease purchases from this fund. CCC intends
                               to repay these receivables, through acquisition
                               fees, debt placement fees and reimbursement of
                               expenses, with a minimum amount of $12,500 per
                               quarter, which commenced in the quarter ending
                               March, 2004.

                               REIMBURSABLE EXPENSES

                               The General Partner and its affiliates are
                               entitled to reimbursement by the Partnership for
                               the cost of supplies and services obtained and
                               used by the General Partner in connection with
                               the administration and operation of the
                               Partnership from third parties unaffiliated with
                               the General Partner. In addition, the General
                               Partner and its affiliates are entitled to
                               reimbursement for certain expenses incurred by
                               the General Partner and its affiliates in
                               connection with the administration and operation
                               of the Partnership. During the three months ended
                               March 31, 2005 and 2004, the Partnership recorded
                               $66,000 and $277,000, respectively, for
                               reimbursement of expenses to the General Partner.

                               EQUIPMENT ACQUISITION FEE

                               The General Partner is entitled to be paid an
                               equipment acquisition fee of 4% of the purchase
                               price of each item of equipment purchased as
                               compensation for the negotiation of the
                               acquisition of the equipment and lease thereof or
                               sale under a conditional sales contract. During
                               the three months ended March 31, 2005 and 2004,
                               equipment acquisition fees of approximately
                               $34,000 and $70,000, respectively, were earned by
                               the General Partner.

                               DEBT PLACEMENT FEE

                               As compensation for arranging term debt to
                               finance the acquisition of equipment by the
                               Partnership, the General Partner is paid a fee
                               equal to 1% of such indebtedness; provided,
                               however, that such fee shall be reduced to the
                               extent the Partnership incurs such fees to third
                               parties, unaffiliated with the General Partner or
                               the lender, with respect to such indebtedness and
                               no such fee will be paid with respect to
                               borrowings from the General Partner or its
                               affiliates. During the three months ended March
                               31, 2005, debt placement fees of approximately
                               $6,000 were earned by the General Partner. There
                               were no debt placement fees earned by the General
                               Partner during the three months ended March 31,
                               2004.
<PAGE>

                               EQUIPMENT MANAGEMENT FEE

                               The General Partner is entitled to be paid a
                               monthly fee equal to the lesser of (i) the fees
                               which would be charged by an independent third
                               party for similar services for similar equipment
                               or (ii) the sum of (a) two percent of (1) the
                               gross lease revenues attributable to equipment
                               which is subject to full payout net leases which
                               contain net lease provisions plus (2) the
                               purchase price paid on conditional sales
                               contracts as received by the Partnership and (b)
                               5% of the gross lease revenues attributable to
                               equipment which is subject to operating and
                               capital leases. During the three months ended
                               March 31, 2005 and 2004, equipment management
                               fees of approximately $60,000 and $48,000,
                               respectively, were earned by the General Partner.

                               EQUIPMENT LIQUIDATION FEE

                               With respect to each item of equipment sold by
                               the General Partner (other than in connection
                               with a conditional sales contract), a fee equal
                               to the lesser of (i) 50% of the competitive
                               equipment sale commission or (ii) three percent
                               of the sales price for such equipment is payable
                               to the General Partner. The payment of such fee
                               is subordinated to the receipt by the limited
                               partners of the net disposition proceeds from
                               such sale in accordance with the Partnership
                               Agreement. Such fee will be reduced to the extent
                               any liquidation or resale fees are paid to
                               unaffiliated parties. During the three months
                               ended March 31, 2004, equipment liquidation fees
                               of approximately $2,000 were earned by the
                               General Partner. There were no equipment
                               liquidation fees earned by the General Partner
                               during the three months ended March 31, 2005.



<PAGE>

5. NOTES PAYABLE               Notes payable consisted of the following:
<TABLE>
<CAPTION>

                                                                                   MARCH 31,         DECEMBER 31,
                                                                                     2005                2004
                               ----------------------------------------------------------------------------------

                              <S>                                                         <C>              <C>
                               Installment notes payable to banks; interest
                               ranging from 5.00% to 6.75%, due in monthly
                               installments ranging from $151 to $4,212,
                               including interest, with final payments due from
                               January through December 2005.                          76,709           139,927

                               Installment notes payable to banks; interest
                               ranging from 4.85% to 6.00%, due in monthly
                               installments ranging from $155 to $22,902,
                               including interest, with final payments due in
                               January through August 2006.                           617,153           865,709

                               Installment notes payable to banks;
                               interest ranging from 4.29% to
                               6.35%, due in monthly installments
                               ranging from $3,746 to $13,488,
                               including interest, with final
                               payments due in January through
                               December 2007.                                       1,332,078         1,030,262

                               Installment notes payable to banks;
                               interest ranging from 5.36% to
                               5.90%, due in monthly installments
                               ranging from $675 to $6,973
                               including interest, with final
                               payment due in January through
                               February 2008.                                         242,158                 -
                                                                               ----------------------------------
                                                                                $   2,268,098       $ 2,035,898
                               ----------------------------------------------------------------------------------

                                    These notes are secured by specific computer
                                    equipment and are nonrecourse liabilities of
                                    the Partnership. Aggregate maturities of
                                    notes payable for each of the periods
                                    subsequent to March 31, 2005 are as follows:

                                                                                                         Amount
                                                                                                     -------------

                                       Nine months ended December 31, 2005                           $     981,985
                                       Year ended December 31, 2006                                        852,105
                                       Year ended December 31, 2007                                        419,623
                                       Year ended December 31, 2008                                         14,385
                                                                                                     -------------
                                                                                                     $   2,268,098
                                                                                                     -------------
</TABLE>

<PAGE>

6.      SUPPLEMENTAL               Other noncash activities included in the
        CASH FLOW                  determination of net loss are as follows:
        INFORMATION

<TABLE>
<CAPTION>

Three Months Ended March 31,                                    2005                2004
--------------------------------------------------------------------------     ---------------

<S>                                                             <C>                   <C>
Lease income, net of interest expense on
 notes payable realized as a result of
 direct payment of principal by lessee to bank             $   336,417          $    249,879
</TABLE>

           No interest or principal on notes payable was paid by the Partnership
           because direct payment was made by lessee to the bank in lieu of
           collection of lease income and payment of interest and principal by
           the Partnership.

           Noncash investing and financing  activities include the following:

<TABLE>
<CAPTION>

Three Months Ended March 31,                                    2005                    2004
--------------------------------------------------------------------------        ---------------
<S>                                                             <C>                   <C>
   Debt assumed in connection with purchase of
     computer equipment                                    $   569,000          $     816,000
--------------------------------------------------------------------------        ---------------
   Equipment acquisition fees earned by General
    Partner upon purchase of equipment from prepaid
    acquisition fees                                       $         -          $      24,564
--------------------------------------------------------------------------------------------------
</TABLE>



<PAGE>

ITEM 2:   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS

CRITICAL ACCOUNTING POLICIES

The Partnership's discussion and analysis of its financial condition and results
of operations are based upon its financial statements which have been prepared
in accordance with accounting principles generally accepted in the United
States. The preparation of these financial statements requires the Partnership
to make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses. The Partnership bases its estimates on
historical experience and on various other assumptions that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates under different assumptions or conditions.

The Partnership believes that its critical accounting policies affect its more
significant judgments and estimates used in the preparation of its financial
statements.

COMPUTER EQUIPMENT

Commonwealth Capital Corp, on behalf of the Partnership and other affiliated
partnerships, acquires computer equipment subject to associated debt obligations
and lease revenue and allocates a participation in the cost, debt and lease
revenue to the various partnerships based on certain risk factors. The
Partnership will acquire equipment with no associated debt obligations with the
original contributions. The Partnership plans on acquiring equipment leases with
associated debt obligations from the monthly rental payments associated with the
equipment acquired with its original capital contributions. Depreciation on
computer equipment for financial statement purposes is based on the
straight-line method over estimated useful lives of four years.

REVENUE RECOGNITION

Through March 31, 2005, the Partnership has only entered into operating leases.
Lease revenue is recognized on a monthly basis in accordance with the terms of
the operating lease agreements.

The Partnership reviews a customer's credit history extending credit and
establishes provisions for uncollectible accounts based upon the credit risk of
specific customers, historical trends and other information.

LONG-LIVED ASSETS

The Partnership evaluates its long-lived assets when events or circumstances
indicate that the value of the asset may not be recoverable. The Partnership
determines whether an impairment exists by estimating the undiscounted cash
flows to be generated by each asset. If the estimated undiscounted cash flows
are less than the carrying value of the asset then an impairment exists. The
amount of the impairment is determined based on the difference between the
carrying value and the fair value. Fair value is determined based on estimated
discounted cash flows to be generated by the asset.


<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

The Partnership's primary source of capital for the three months ended March 31,
2005 and 2004 was from net proceeds received from sale of equipment of
approximately $18,000 and $55,000, respectively. The primary uses of cash for
the three months ended March 31, 2005 and 2004 were for capital expenditures for
new equipment of approximately $284,000 and $614,000, respectively, and the
payment of preferred distributions to partners of approximately $375,000 and
$375,000, respectively. The Partnership also made an advance to CCC, a related
party to the Partnership, in the amount of approximately $83,000 for the three
months ended March 31, 2004.

For the three month period ended March 31, 2005, the Partnership generated cash
flows from operating activities of approximately $360,000, which includes net
income of approximately $32,000, payment of accounts payable, which was
primarily for the purchase of equipment of approximately $52,000, a loss on sale
of equipment of approximately $9,000, and depreciation and amortization expenses
of approximately $966,000. Other non-cash activities included in the
determination of net income include direct payments of lease income by lessees
to banks of approximately $336,000.

For the three month period ended March 31, 2004, the Partnership used cash flows
from operating activities of approximately $2,108,000, which includes a net loss
of approximately $170,000, payment of accounts payable, which was primarily for
the purchase of equipment of approximately $2,260,000, a loss on sale of
equipment of approximately $3,000, and depreciation and amortization expenses of
approximately $728,000. Other non-cash activities included in the determination
of net income include direct payments of lease income by lessees to banks of
approximately $250,000.

Cash is invested in money market accounts that invest directly in treasury
obligations pending the Partnership's use of such funds to purchase additional
computer equipment, to pay Partnership expenses or to make distributions to the
Partners. At March 31, 2005, the Partnership did not have any cash invested in
these money market accounts due to a change in banks used by the Partnership.

The Partnership's investment strategy of acquiring computer equipment and
generally leasing it under "triple-net leases" to operators who generally meet
specified financial standards minimizes the Partnership's operating expenses. As
of March 31, 2005, the Partnership had future minimum rentals on non-cancelable
operating leases of $3,180,000 for the balance of the year ending December 31,
2005 and $4,047,000 thereafter. At March 31, 2005, the outstanding debt was
$2,268,000, with interest rates ranging from 4.29% to 6.75%, and will be payable
through February 2008.

As of March 31, 2005, the Partnership has an unsecured, non-interest bearing
receivable from CCC, a related party to the Partnership, in the amount of
approximately 253,000, which primarily originated in 2003. CCC, through its
indirect subsidiaries, including the General Partner of the Partnership, earns
fees based on revenues and new lease purchases from this fund. CCC intends to
repay these receivables, through acquisition fees, debt placement fees and
reimbursement of expenses, with a minimum amount of $12,500 per quarter, which
commenced in the quarter ending March, 2004.

The Partnership's cash from operations is expected to continue to be adequate to
cover all operating expenses, liabilities, and preferred distributions to
Partners during the next 12-month period. If available Cash Flow or Net
Disposition Proceeds are insufficient to cover the Partnership expenses and
liabilities on a short and long term basis, the Partnership will attempt to
obtain additional funds by disposing of or refinancing Equipment, or by
borrowing within its permissible limits. The Partnership may, from time to time,
reduce the distributions to its Partners if it deems necessary. Since the
Partnership's leases are on a "triple-net" basis, no reserve for maintenance and
repairs are deemed necessary.

The Partnership's share of the computer equipment in which they participate at
March 31, 2005 and March 31, 2004 was approximately $909,000 for both period
ends, which is included in the Partnership's fixed assets on their balance
sheet, and the total cost of the equipment shared by the Partnership with other
partnerships at March 31, 2005 and March 31, 2004 was approximately $1,798,000
for both period ends.


<PAGE>

RESULTS OF OPERATIONS

Three Months Ended March 31, 2005 compared to Three Months Ended March 31, 2004

For the three months ended March 31, 2005, the Partnership recognized income of
approximately $1,253,000, and expenses of approximately $1,221,000, resulting in
net income of approximately $32,000. For the three months ended March 31, 2004,
the Partnership recognized income of approximately $975,000 and expenses of
approximately $1,146,000 resulting in a net loss of approximately $170,000.

Lease income increased by 29% to $1,253,000 for the quarter ended March 31,
2005, from $968,000 for the quarter ended March 31, 2004, primarily due to the
fact that more lease agreements were entered into since the quarter ended March
31, 2005.

Operating expenses, excluding depreciation, primarily consist of accounting,
legal, outside service fees and reimbursement of expenses to CCC, a related
party, for administration and operation of the Partnership. The expense
decreased 54% to approximately $157,000 for the quarter ended March 31, 2005,
from $338,000 for the quarter ended March 31, 2004, which is primarily
attributable to an decrease in the amount charged by CCC of approximately
$201,000 to the Partnership for the administration and operation of the
partnership. There was a decrease in due diligence expenses of approximately
$39,000.


The equipment management fee is approximately 5% of the gross lease revenue
attributable to equipment that is subject to operating leases. The equipment
management fee increased 50% to approximately $60,000 for the quarter ended
March 31, 2005, from $48,000 for the quarter ended March 31, 2004, which is
consistent with the increase in lease income.

Depreciation and amortization expenses consist of depreciation on computer
equipment and amortization of equipment acquisition fees. The expenses increased
33% to approximately $969,000 for the quarter ended March 31, 2005, from
$728,000 for the quarter ended March 31, 2004 due to additional equipment being
purchased and the associated acquisition and finance fees being recorded by the
Partnership since the quarter ended March 31, 2004.

The Partnership sold computer equipment with a net book value of approximately
$27,000 for the quarter ended March 31, 2005, for a net loss of approximately
$9,000. The Partnership sold computer equipment with a net book value of
approximately $58,000 for the quarter ended March 31, 2004, for a net loss of
approximately $3,000

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Partnership believes its exposure to market risk is not material due to the
fixed interest rate of its long-term debt.


<PAGE>

ITEM 4.  CONTROLS AND PROCEDURES

The Chief Executive Officer and a Financial Officer of the Partnership have
conducted a review of the Partnership's disclosure controls and procedures as of
March 31, 2005.

The Partnership's disclosure controls and procedures include the Partnership's
controls and other procedures designed to ensure that information required to be
disclosed in this and other reports filed under the Securities Exchange Act of
1934, as amended (the " Exchange Act") is accumulated and communicated to the
Partnership's management, including its chief executive officer and a financial
officer, to allow timely decisions regarding required disclosure and to ensure
that such information is recorded, processed, summarized and reported with the
required time quarters.

Based upon this review, the Partnership's Chief Executive Officer and a
Financial Officer have concluded that the Partnership's disclosure controls (as
defined in pursuant to Rule 13a-14 c promulgated under the Exchange Act) are
sufficiently effective to ensure that the information required to be disclosed
by the Partnership in the reports it files under the Exchange Act is recorded,
processed, summarized and reported with adequate timeliness.

There have been no changes in the General Partner's internal controls or in
other factors that could materially affect our disclosure controls and
procedures in the quarter ended March 31, 2005, that have materially affected or
are reasonably likely to materially affect the General Partner's internal
controls over financial reporting.


PART II:   OTHER INFORMATION

                      COMMONWEALTH INCOME & GROWTH FUND IV

         Item 1.          LEGAL PROCEEDINGS.

                           Inapplicable

         Item 2.          CHANGES IN SECURITIES.

                          Inapplicable

         Item 3.          DEFAULTS UPON SENIOR SECURITIES.

                          Inapplicable

         Item 4.          SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS.

                          Inapplicable

         Item 5.          OTHER INFORMATION.

                          Inapplicable

         Item 6.          EXHIBITS AND REPORTS ON FORM 8-K.

                          a) Exhibits:

                                   31.1 THE RULE 15D-14(A)
                                   31.2  THE RULE 15D-14(A)
                                   32.1 SECTION 1350 CERTIFICATION OF CEO
                                   32.2 SECTION 1350 CERTIFICATION OF CFO

                          b) Report on Form 8-K: None



<PAGE>

                                    SIGNATURE

Pursuant to the requirements 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.



                                 COMMONWEALTH INCOME & GROWTH FUND IV

                                 BY: COMMONWEALTH INCOME & GROWTH FUND, INC.
                                     General Partner


May 16, 2005                     By: /s/ George S. Springsteen
------------                        ------------------------------
Date                             George S. Springsteen
                                 President