<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 JUNE 30, 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]





                                                                               1
<PAGE>
                                    FORM 10-Q
                                  JUNE 30, 2005

                                TABLE OF CONTENTS

                                     PART I
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           16
Item 4.  Controls and Procedures                                              16

                                  PART II
Item 1.  Legal Proceedings                                                    16
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.         17
Item 3.  Defaults Upon Senior Securities                                      17
Item 4.  Submission of Matters to a Vote of Securities Holders                17
Item 5.  Other Information                                                    17
Item 6.  Index to Exhibits


         Signatures

         Certifications


                                                                               2
<PAGE>
                      COMMONWEALTH INCOME & GROWTH FUND IV
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                            JUNE 30,             DECEMBER 31,
                                                             2005                   2004
                                                        ---------------         --------------
                                                          (UNAUDITED)
<S>                                                    <C>                      <C>
ASSETS

Cash and cash equivalents                               $     1,468,479         $      719,161
Lease income receivable, net of reserves of $0
       as of June 30, 2005 and  December 31, 2004                55,617                157,741
Other assets                                                      2,516                  2,043
                                                        ---------------         --------------
                                                              1,526,612                878,945
                                                        ---------------         --------------

Computer equipment, at cost                                  14,964,325             14,299,155

Accumulated depreciation                                     (6,060,012)            (4,386,199)
                                                        ---------------         --------------
                                                              8,904,313              9,912,956
                                                        ---------------         --------------

Equipment acquisition costs and deferred expenses, net          295,310                369,202
Other receivables - Commonwealth Capital Corp                   246,605                243,435
Prepaid acquisition fees                                        100,138                 98,321
                                                        ---------------         --------------
                                                                642,053                710,958
                                                        ---------------         --------------

TOTAL ASSETS                                            $    11,072,978         $   11,502,859
                                                        ===============         ==============


LIABILITIES AND PARTNERS' CAPITAL

LIABILITIES
Accounts payable, primarily for equipment purchases     $       338,947          $     118,403
Accounts payable - other affiliated partnerships                445,090                376,552
Accounts payable - General Partner                               54,060                 53,075
Accounts payable - Commonwealth Capital Corp.                    32,451                      -
Unearned lease income                                           104,042                 60,464
Notes payable                                                 2,016,788              2,035,898
                                                        ---------------         --------------
TOTAL LIABILITIES                                             2,991,378              2,644,392
                                                        ---------------         --------------

PARTNERS' CAPITAL

General partner                                                   1,000                  1,000
Limited partners                                              8,080,600              8,857,467
                                                        ---------------         --------------
TOTAL PARTNERS' CAPITAL                                       8,081,600              8,858,467
                                                        ---------------         --------------

TOTAL LIABILITIES AND PARTNERS' CAPITAL                 $    11,072,978         $   11,502,859
                                                        ===============         ==============
</TABLE>

            see accompanying notes to condensed financial statements

                                                                               3
<PAGE>
                      COMMONWEALTH INCOME & GROWTH FUND IV
                       CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                           THREE MONTHS       THREE MONTHS         SIX MONTHS         SIX MONTHS
                                                              ENDED               ENDED              ENDED              ENDED
                                                             JUNE 30,            JUNE 30,           JUNE 30,           JUNE 30,
                                                               2005                2004               2005               2004
                                                           -------------      -------------       -------------      -------------
                                                                     (UNAUDITED)                            (UNAUDITED)
<S>                                                       <C>                <C>                 <C>                <C>
INCOME
Lease                                                      $   1,266,597      $   1,067,397       $   2,519,435      $   2,035,089
Interest and other                                                     5                 60                 557              7,723
                                                           -------------      -------------       -------------      -------------


TOTAL INCOME                                                   1,266,602          1,067,457           2,519,992          2,042,812
                                                           -------------      -------------       -------------      -------------

EXPENSES
Operating, excluding depreciation                                164,863            160,372             322,169            498,742
Equipment management fee - General Partner                        65,985             53,369             125,971            101,754
Interest                                                          29,347             27,660              58,600             55,712
Depreciation                                                     933,251            769,721           1,845,501          1,456,557
Amortization of equipment
  acquisition costs and deferred expenses                         56,320             43,266             109,966             84,450
Loss on sale of computer equipment                                66,778                  -              75,583              2,919
                                                           -------------      -------------       -------------      -------------
TOTAL EXPENSES                                                 1,316,544          1,054,388           2,537,790          2,200,134
                                                           -------------      -------------       -------------      -------------

NET (LOSS) INCOME                                          $     (49,942)     $      13,069       $     (17,798)     $    (157,322)
                                                           =============      =============       =============      =============

NET (LOSS) INCOME PER EQUIVALENT LIMITED
  PARTNERSHIP UNIT                                         $      (0.07)      $        0.02       $       (0.02)     $       (0.21)
                                                           =============      =============       =============      =============

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

            see accompanying notes to condensed financial statements

                                                                               4
<PAGE>
                      COMMONWEALTH INCOME & GROWTH FUND IV
                    CONDENSED STATEMENTS OF PARTNERS' CAPITAL
<TABLE>
<CAPTION>
                                                                FOR THE SIX MONTHS ENDED JUNE 30, 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)                           -                  -               7,494             (25,293)            (17,798)
  Redemption                                                                                        (9,617)             (9,617)
  Distributions                               -                  -              (7,494)           (741,956)           (749,451)
                                         --------        ---------             -------        ------------         -----------
PARTNERS' CAPITAL - JUNE 30, 2005            50            749,950             $ 1,000        $  8,080,600         $ 8,081,600
                                         ========        =========             =======        ============         ===========
</TABLE>

            see accompanying notes to condensed financial statements

                                                                               5
<PAGE>
                      COMMONWEALTH INCOME & GROWTH FUND IV
                        CONDENSED STATEMENTS OF CASH FLOW
                 FOR THE SIX MONTHS ENDED JUNE 30, 2005 AND 2004
<TABLE>
<CAPTION>
                                                                        2005                   2004
                                                                    -------------          -------------
                                                                                (UNAUDITED)
<S>                                                                 <C>                    <C>
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                 $   1,793,002          $  (1,998,723)
                                                                    -------------          -------------

INVESTING ACTIVITIES:

Capital expenditures                                                     (297,631)            (1,139,223)
Acquisition fees                                                          (31,299)               (31,820)
Net proceeds from sale of computer equipment                               44,392                 55,431
                                                                    -------------          -------------
NET CASH (USED IN) INVESTING ACTIVITIES                                  (284,538)            (1,115,612)
                                                                    -------------          -------------

FINANCING ACTIVITIES:
Redemptions                                                                (9,617)                     -
Distributions to partners                                                (749,451)              (750,468)
Other receivable, Commonwealth Capital Corp                                 6,514                (54,775)
Debt Placement fee paid to the General Partner                             (6,592)                (6,982)
                                                                    -------------          -------------
NET CASH (USED IN)  FINANCING ACTIVITIES                                 (759,146)              (812,225)
                                                                    -------------          -------------

Net increase (decrease) in cash and cash equivalents                      749,318             (3,926,560)
Cash and cash equivalents, beginning of period                            719,161              4,644,293
                                                                    -------------          -------------
CASH AND CASH EQUIVALENTS, END OF PERIOD                            $   1,468,479          $     717,733
                                                                    =============          =============
</TABLE>
            see accompanying notes to condensed financial statements

                                                                               6
<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 date other
    POLICIES          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 six-month period ended June 30, 2005 are
                      not necessarily indicative of financial results that may
                      be expected for the full year ended December 31, 2005.

                                                                               7
<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 six
                      months ended June 30, 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 under operating
    EQUIPMENT         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 June 30, 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.

                      Remarketing fees are paid to the leasing companies from
                      which the Partnership purchases leases. These are fees
                      that are earned by the leasing companies when the initial
                      terms of the lease have been met. The General Partner
                      believes that this strategy adds value since it entices
                      the leasing company to "stay with the lease" for potential
                      extensions, remarketing or sale of equipment. This
                      strategy potentially minimizes any conflicts the leasing
                      company may have with a potential new lease and will
                      potentially assist in maximizing overall portfolio
                      performance. The remarketing fee is tied into lease
                      performance thresholds and is factored in the negotiation
                      of the fee. Remarketing fees incurred in connection with
                      lease extensions are accounted for as operating costs.
                      Remarketing fees incurred in connection with the sale of
                      computer equipment are included in our gain or loss
                      calculations. For the six-month period ended June 30,
                      2005, remarketing fees were paid in the amount of $7,000.
                      No remarketing fees were paid for the period ended June
                      30, 2004.

                                                                               8
<PAGE>

                      The Partnership's share of the computer equipment in which
                      they participate at June 30, 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 June 30,
                      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 June 30, 2005:

                                                                       Amount
                      ----------------------------------------------------------
                      Six  Months ended December 31, 2005          $   2,343,000
                      Year Ended December 31, 2006                     3,325,000
                      Year Ended December 31, 2007                       843,000
                      Year Ended December 31, 2008                        29,000
                                                                   -------------
                                                                   $   6,540,000
                      ==========================================================

4.  RELATED PARTY
    TRANSACTIONS      OTHER RECEIVABLES

                      As of June 30, 2005, the Partnership has an unsecured,
                      non-interest bearing receivable from CCC, a related party
                      to the Partnership, in the amount of approximately
                      $246,000, 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 six months ended
                      June 30, 2005 and 2004, the Partnership recorded $150,000
                      and $425,000, 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 six
                      months ended June 30, 2005 and 2004, equipment acquisition
                      fees of approximately $38,000 and $74,000, respectively,
                      were earned by the General Partner.

                                                                               9
<PAGE>
                      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 six months ended June 30, 2005 and
                      2004, debt placement fees of approximately $7,000 for both
                      periods, were earned by the General Partner.

                      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 six months ended June 30, 2005 and
                      2004, equipment management fees of approximately $126,000
                      and $102,000, 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 six months ended June 30,
                      2005 and 2004, equipment liquidation fees of approximately
                      $1,000 and $2,000, respectively, were earned by the
                      General Partner.


                                                                              10
<PAGE>

5.  NOTES PAYABLE     Notes payable consisted of the following:

                                                         JUNE 30,   DECEMBER 31,
                                                          2005         2004
                      ----------------------------------------------------------
                      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.                           $    36,467    $   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.                487,070        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.            1,256,833      1,030,262

                      Installment notes payable to
                      banks; interest ranging from
                      5.36% to 6.06%, due in
                      monthly installments ranging
                      from $162 to $6,973 including
                      interest, with final payment
                      due in January through
                      February 2008.                      236,408              -
                                                      -----------    -----------
                                                      $ 2,016,778    $ 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 June 30, 2005 are as follows:

                                                                       Amount
                                                                    ------------
                      Six months ended December 31, 2005            $    660,348
                      Year ended December 31, 2006                       886,323
                      Year ended December 31, 2007                       455,461
                      Year ended December 31, 2008                        14,646
                                                                    ------------
                                                                    $  2,016,778
                                                                    ------------

                                                                              11
<PAGE>
6.  SUPPLEMENTAL      Other noncash activities included in the determination of
    CASH FLOW         net loss are as follows:
    INFORMATION

Six Months Ended June 30,                                  2005          2004
------------------------------------------------------------------    ----------

Lease income, net of interest expense on
  notes payable realized as a result of
  direct payment of principal by lessee to
  bank                                                  $  678,312    $  518,004

                      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:

Six Months Ended June 30,                                  2005          2004
------------------------------------------------------------------    ----------
Debt assumed in connection with
  purchase of computer equipment                        $  663,906    $  698,178
=====================================                   ==========    ==========
Equipment acquisition fees earned by
  General Partner upon purchase of
  equipment from prepaid acquisition
  fees                                                  $        -    $   41,676
================================================================================

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.

                                                                              12
<PAGE>
REVENUE RECOGNITION

Through June 30, 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.

LIQUIDITY AND CAPITAL RESOURCES

The Partnership's primary source of capital for the six months ended June 30,
2005 and 2004 was from net proceeds received from sale of equipment of
approximately $44,000 and $55,000, respectively. The primary uses of cash for
the six months ended June 30, 2005 and 2004 were for capital expenditures for
new equipment of approximately $298,000 and $1,139,000, respectively, and the
payment of preferred distributions to partners of approximately $750,000 for
both periods. The Partnership also made an advance to CCC, a related party to
the Partnership, in the amount of approximately $55,000 for the six months ended
June 30, 2004.

For the six month period ended June 30, 2005, the Partnership generated cash
flows from operating activities of approximately $1,793,000, which includes a
net loss of approximately $18,000, payment of accounts payable, which was
primarily for the purchase of equipment of approximately $221,000, a loss on
sale of equipment of approximately $76,000, and depreciation and amortization
expenses of approximately $1,955,000. Other non-cash activities included in the
determination of net income include direct payments of lease income by lessees
to banks of approximately $678,000.

For the six month period ended June 30, 2004, the Partnership used cash flows
from operating activities of approximately $1,999,000, which includes a net loss
of approximately $157,000, payment of accounts payable, which was primarily for
the purchase of equipment of approximately $2,248,000, a loss on sale of
equipment of approximately $3,000, and depreciation and amortization expenses of
approximately $1,541,000. Other non-cash activities included in the
determination of net income include direct payments of lease income by lessees
to banks of approximately $518,000.

                                                                              13
<PAGE>
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 June 30, 2005 and 2004, the Partnership had $8,000 and $50,000,
respectively, invested in these money market accounts.

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 June 30, 2005, the Partnership had future minimum rentals on non-cancelable
operating leases of $2,343,000 for the balance of the year ending December 31,
2005 and $4,197,000 thereafter. At June 30, 2005, the outstanding debt was
$2,017,000, with interest rates ranging from 4.29% to 6.75%, and will be payable
through February 2008.

As of June 30, 2005, the Partnership has an unsecured, non-interest bearing
receivable from CCC, a related party to the Partnership, in the amount of
approximately $247,000, 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 intends to invest $2,900,000 in additional equipment for the
remainder of 2005. The acquisition of this equipment will be funded by debt
financing, and the debt service will be funded from cash flows from lease rental
payments.

The Partnership's share of the computer equipment in which they participate at
June 30, 2005 and June 30, 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 June 30, 2005 and June 30, 2004 was approximately $1,798,000 for
both period ends.

RESULTS OF OPERATIONS

  Three Months Ended June 30, 2005 compared to Three Months Ended June 30, 2004

For the three months ended June 30, 2005, the Partnership recognized income of
approximately $1,267,000, and expenses of approximately $1,317,000, resulting in
a net loss of approximately $50,000. For the three months ended June 30, 2004,
the Partnership recognized income of approximately $1,067,000 and expenses of
approximately $1,054,000 resulting in net income of approximately $13,000.

                                                                              14
<PAGE>
Lease income increased by 19% to $1,267,000 for the quarter ended June 30, 2005,
from $1,067,000 for the quarter ended June 30, 2004, primarily due to the fact
that more lease agreements were entered into since the quarter ended June 30,
2004.

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 expenses
increased 3% to approximately $165,000 for the quarter ended June 30, 2005, from
$160,000 for the quarter ended June 30, 2004.

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 24% to approximately $66,000 for the quarter ended June
30, 2005, from $53,000 for the quarter ended June 30, 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
22% to approximately $990,000 for the quarter ended June 30, 2005, from $813,000
for the quarter ended June 30, 2004 due to additional equipment being purchased
and the associated acquisition and finance fees being recorded by the
Partnership since the quarter ended June 30, 2004.

The Partnership sold computer equipment with a net book value of approximately
$93,000 for the quarter ended June 30, 2005, for a net loss of approximately
$67,000.

    Six Months Ended June 30, 2005 compared to Six Months Ended June 30, 2004

For the six months ended June 30, 2005, the Partnership recognized income of
approximately $2,520,000, and expenses of approximately $2,538,000, resulting in
a net loss of approximately $18,000. For the six months ended June 30, 2004, the
Partnership recognized income of approximately $2,043,000, and expenses of
approximately $2,200,000, resulting in a net loss of approximately $157,000.

Lease income increased by 24% to $2,519,000 for the six months ended June 30,
2005, from $2,035,000 for the six months ended June 30, 2004, primarily due to
the fact that more lease agreements were entered into since the six months ended
June 30, 2004.

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 expenses
decreased 35% to approximately $322,000 for the quarter ended June 30, 2005,
from $499,000 for the quarter ended June 30, 2004, primarily due to a decrease
in the amount charged by CCC, a related party, to the Partnership for its
administration and operation of approximately $100,000, a decrease in due
diligence costs or approximately $34,000, and a decrease in accounting fees of
approximately $15,000.

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 24% to approximately $126,000 for the six months ended
June 30, 2005, from $102,000 for the six months ended June 30, 2004, which is
consistent with the increase in lease income.

                                                                              15
<PAGE>
Depreciation and amortization expenses consist of depreciation on computer
equipment and amortization of equipment acquisition fees. The expenses increased
27% to approximately $1,955,000 for the six months ended June 30, 2005, from
$1,541,000 for the six months ended June 30, 2004 due to additional equipment
being purchased and the associated acquisition and finance fees being recorded
by the Partnership since the six months ended June 30, 2004.

The Partnership sold computer equipment with a net book value of approximately
$120,000 for the six months ended June 30, 2005, for a net loss of approximately
$76,000. The Partnership sold computer equipment with a net book value of
approximately $58,000 for the six months ended June 30, 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.

ITEM 4. CONTROLS AND PROCEDURES

The Chief Executive Officer and a Financial Officer of the General Partner have
conducted a review of the Partnership's disclosure controls and procedures as of
June 30, 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 General Partner'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 June 30, 2005, that have materially affected or
are reasonably likely to materially affect the General Partner's internal
controls over financial reporting.


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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


                                                                              17
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                                    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

August 11, 2005                     By: /s/ Kimberly A. Springsteen
---------------                        ----------------------------
Date                                   Kimberly A. Springsteen
                                       President