UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC  20549
FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For The Quarterly Period EndedDecember 31, 2005Commission File Number0-21762                     
                    Gateway Tax Credit Fund III Ltd.         (Exact name of Registrant as specified in its charter)Florida                               59-3090386 (State or other jurisdiction of              (IRS Employer No.)
 incorporation or organization)880 Carillon Parkway,   St. Petersburg,  Florida       33716       (Address of principal executive offices)        (Zip Code)
Registrant's Telephone Number, Including Area Code:(727) 567-4830
Indicate by check mark whether the Registrant: (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to 
such filing requirements for the past 90 days.
                                    YESX      NO
                                                       Number of Units
     Title of Each Class                             December 31, 2005Units of Limited Partnership
Interest:  $1,000 per unit                                  33,799

DOCUMENTS INCORPORATED BY REFERENCEParts I and II, 2005 Form 10-K, filed with the
Securities and Exchange Commission on July 13, 2005
Parts III and IV - Form S-11 Registration Statement
and all amendments and supplements thereto
File No. 33-44238

---

PART I - Financial Information
   Item 1.  Financial Statements

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)BALANCE SHEET

|SERIES 7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | DECEMBER 31,
2005  
----------
(Unaudited)                                                                                                                                                                                                 | MARCH 31,
2005  
---------
(Audited)                                                                                                                                                                                                        
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ASSETS
Current Assets:
 Cash and Cash Equivalents
 Investments in Securities
  Total Current Assets
 Investments in Securities
 Investments in Project Partnerships, Net
    Total Assets
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
 Payable to General Partners
  Total Current Liabilities
Long-Term Liabilities:
 Payable to General Partners
Partners' Equity (Deficit):
Limited Partners (10,395 units for Series 7, 9,980 for Series 8, 6,254 for Series 9, 5,043 for Series 10 and 5,127 for Series 11 at December 31, 2005 and March 31, 2005)
General Partners
  Total Partners' Equity
    Total Liabilities and Partners' Equity | $  333,293 
76,505 
-----------
409,798 
148,334 
902,223 
-----------
$1,460,355 
===========
$   54,226 
-----------
54,226 
-----------
622,814 
-----------
866,760 
(83,445)
-----------
783,315 
-----------
$1,460,355 
=========== | $  383,342 
72,445 
-----------
455,787 
140,326 
965,655 
-----------
$1,561,768 
===========
$   53,630 
-----------
53,630 
-----------
557,979 
-----------
1,031,936 
(81,777)
-----------
950,159 
-----------
$1,561,768 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)BALANCE SHEET

|SERIES 8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | DECEMBER 31,
2005  
---------
(Unaudited)                                                                                                                                                                                                          | MARCH 31,
2005  
--------
(Audited)                                                                                                                                                                                                                
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ASSETS
Current Assets:
 Cash and Cash Equivalents
 Investments in Securities
 Accounts Receivable
  Total Current Assets
 Investments in Securities
 Investments in Project Partnerships, Net
    Total Assets
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
 Payable to General Partners
  Total Current Liabilities
Long-Term Liabilities:
 Payable to General Partners
Partners' Equity (Deficit):
Limited Partners (10,395 units for Series 7, 9,980 for Series 8, 6,254 for Series 9, 5,043 for Series 10 and 5,127 for Series 11 at December 31, 2005 and March 31, 2005)
General Partners
  Total Partners' Equity
    Total Liabilities and Partners' Equity | $  258,302 
71,497 
24,220 
-----------
354,019 
142,004 
468,093 
-----------
$  964,116 
===========
$   45,047 
-----------
45,047 
-----------
661,828 
-----------
342,294 
(85,053)
-----------
257,241 
-----------
$  964,116 
=========== | $  325,662 
67,927 
24,220 
-----------
417,809 
134,748 
461,161 
-----------
$1,013,718 
===========
$   45,110 
-----------
45,110 
-----------
594,397 
-----------
458,094 
(83,883)
-----------
374,211 
-----------
$1,013,718 
============



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)BALANCE SHEET

|SERIES 9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | DECEMBER 31,
2005  
---------
(Unaudited)                                                                                                                                                                                                  | MARCH 31,
2005  
--------
(Audited)                                                                                                                                                                                                       
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ASSETS
Current Assets:
 Cash and Cash Equivalents
 Investments in Securities
  Total Current Assets
 Investments in Securities
 Investments in Project Partnerships, Net
    Total Assets
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
 Payable to General Partners
    Total Current Liabilities
Long-Term Liabilities:
 Payable to General Partners
Partners' Equity (Deficit):
Limited Partners (10,395 units for Series 7, 9,980 for Series 8, 6,254 for Series 9, 5,043 for Series 10 and 5,127 for Series 11 at December 31, 2005 and March 31, 2005)
General Partners
  Total Partners' Equity
    Total Liabilities and Partners' Equity | $  193,876 
40,714 
-----------
234,590 
118,011 
717,999 
-----------
$1,070,600 
===========
$   25,719 
-----------
25,719 
-----------
416,270 
-----------
677,161 
(48,550)
-----------
628,611 
-----------
$1,070,600 
=========== | $  229,897 
38,890 
-----------
268,787 
112,579 
798,862 
-----------
$1,180,228 
===========
$   25,407 
-----------
25,407 
-----------
379,140 
-----------
822,760 
(47,079)
-----------
775,681 
-----------
$1,180,228 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)BALANCE SHEET

|SERIES 10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | DECEMBER 31,
2005  
---------
(Unaudited)                                                                                                                                                                                                       | MARCH 31,
2005  
--------
(Audited)                                                                                                                                                                                                            
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ASSETS
Current Assets:
 Cash and Cash Equivalents
 Investments in Securities
  Total Current Assets
 Investments in Securities
 Investments in Project Partnerships, Net
    Total Assets
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
 Payable to General Partners
    Total Current Liabilities
Long-Term Liabilities:
 Payable to General Partners
Partners' Equity (Deficit):
Limited Partners (10,395 units for Series 7, 9,980 for Series 8, 6,254 for Series 9, 5,043 for Series 10 and 5,127 for Series 11 at December 31, 2005 and March 31, 2005)
General Partners
  Total Partners' Equity
    Total Liabilities and Partners' Equity | $  121,009 
31,055 
-----------
152,064 
118,899 
1,570,981 
-----------
$1,841,944 
===========
$   28,777 
-----------
28,777 
-----------
36,669 
-----------
1,802,912 
(26,414)
-----------
1,776,498 
-----------
$1,841,944 
=========== | $  142,638 
29,480 
-----------
172,118 
112,721 
1,661,049 
-----------
$1,945,888 
===========
$   28,777 
-----------
28,777 
-----------
11,305 
-----------
1,930,927 
(25,121)
-----------
1,905,806 
-----------
$1,945,888 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)BALANCE SHEET

|SERIES 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | DECEMBER 31,
2005  
---------
(Unaudited)                                                                                                                                                                                                     | MARCH 31,
2005  
--------
(Audited)                                                                                                                                                                                                         
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ASSETS
Current Assets:
 Cash and Cash Equivalents
 Investments in Securities
 Receivable from General Partner
  Total Current Assets
 Investments in Securities
 Investments in Project Partnerships, Net
    Total Assets
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
 Payable to General Partners
  Total Current Liabilities
Long-Term Liabilities:
 Payable to General Partners
Partners' Equity (Deficit):
Limited Partners (10,395 units for Series 7, 9,980 for Series 8, 6,254 for Series 9, 5,043 for Series 10 and 5,127 for Series 11 at December 31, 2005 and March 31, 2005)
General Partners
  Total Partners' Equity
    Total Liabilities and Partners' Equity | $  184,109 
35,749 
0 
-----------
219,858 
134,696 
2,564,983 
-----------
$2,919,537 
===========
$   12,527 
-----------
12,527 
-----------
0 
-----------
2,923,931 
(16,921)
-----------
2,907,010 
-----------
$2,919,537 
=========== | $  199,931 
33,838 
8,291 
-----------
242,060 
127,336 
2,664,780 
-----------
$3,034,176 
===========
$        0 
-----------
0 
-----------
0 
-----------
3,049,825 
(15,649)
-----------
3,034,176 
-----------
$3,034,176 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)BALANCE SHEET

|TOTAL SERIES 7 - 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | DECEMBER 31,
2005  
---------
(Unaudited)                                                                                                                                                                                                                               | MARCH 31,
2005  
--------
(Audited)                                                                                                                                                                                                                                      
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ASSETS
Current Assets:
 Cash and Cash Equivalents
 Investments in Securities
 Accounts Receivable
 Receivable from General Partner
  Total Current Assets
 Investments in Securities
 Investments in Project Partnerships, Net
    Total Assets
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
 Payable to General Partners
  Total Current Liabilities
Long-Term Liabilities:
 Payable to General Partners
Partners' Equity (Deficit):
Limited Partners (10,395 units for Series 7, 9,980 for Series 8, 6,254 for Series 9, 5,043 for Series 10 and 5,127 for Series 11 at December 31, 2005 and March 31, 2005)
General Partners
  Total Partners' Equity
    Total Liabilities and Partners' Equity | $ 1,090,589 
255,520 
24,220 
0 
------------
1,370,329 
661,944 
6,224,279 
-----------
$ 8,256,552 
===========
$   166,296 
-----------
166,296 
-----------
1,737,581 
-----------
6,613,058 
(260,383)
-----------
6,352,675 
-----------
$ 8,256,552 
=========== | $ 1,281,470 
242,580 
24,220 
8,291 
-----------
1,556,561 
627,710 
6,551,507 
-----------
$ 8,735,778 
===========
$   152,924 
-----------
152,924 
-----------
1,542,821
-----------
7,293,542 
(253,509)
-----------
7,040,033 
-----------
$ 8,735,778 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 2005
----                                                                                                                                                                                                                                                               | 2004
----                                                                                                                                                                                                                                                              
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited Partnership
Units
Number of Limited Partnership Units
Outstanding | $    3,716 
-----------
3,716 
-----------
21,612 
22,850 
2,635 
1,219 
-----------
48,316 
-----------
(44,600)
(11,330)
6,870 
-----------
$  (49,060)
===========
$  (48,569)
(491)
-----------
$  (49,060)
===========
$    (4.67)
===========
10,395 
=========== | $    3,553 
-----------
3,553 
-----------
21,687 
14,678 
1,796 
1,661 
-----------
39,822 
-----------
(36,269)
(34,994)
6,089 
-----------
$  (65,174)
===========
$  (64,522)
(652)
-----------
$  (65,174)
===========
$    (6.21)
===========
10,395 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 2005
----                                                                                                                                                                                                                                                          | 2004
----                                                                                                                                                                                                                                                           
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
 Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Income (Losses) of   Project Partnerships and Other Income
Equity in Income (Losses) of Project  Partnerships
Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited
Partnership Units
Number of Limited Partnership Units
Outstanding | $    1,895 
-----------
1,895 
-----------
22,477 
25,194 
2,860 
567 
-----------
51,098 
-----------
(49,203)
4,216 
5,870 
-----------
$  (39,117)
===========
$  (38,726)
(391)
-----------
$  (39,117)
===========
$    (3.88)
===========
9,980 
=========== | $    6,701 
-----------
6,701 
-----------
22,578 
16,184 
1,937 
768 
-----------
41,467 
-----------
(34,766)
(17,775)
5,455 
-----------
$  (47,086)
===========
$  (46,615)
(471)
-----------
$  (47,086)
===========
$    (4.67)
===========
9,980 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2005
----                                                                                                                                                                                                                                                          | 2004
----                                                                                                                                                                                                                                                        
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Income (Losses) of Project Partnerships and Other Income
Equity in Income (Losses) of Project Partnerships
 Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited Partnership
Units
Number of Limited Partnership Units
Outstanding | $      795 
-----------
795 
-----------
12,377 
14,062 
1,701 
594 
-----------
28,734 
-----------
(27,939)
(27,875)
4,072 
-----------
$  (51,742)
===========
$  (51,225)
(517)
-----------
$  (51,742)
===========
$    (8.19)
===========
6,254 
=========== | $    2,975 
-----------
2,975 
-----------
12,428 
9,033 
1,224 
771 
-----------
23,456 
-----------
(20,481)
2,395 
3,543 
-----------
$  (14,543)
===========
$  (14,398)
(145)
-----------
$  (14,543)
===========
$    (2.30)
===========
6,254 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 2005
----                                                                                                                                                                                                                                                        | 2004
----                                                                                                                                                                                                                                                       
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
 Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited Partnership
Units
Number of Limited Partnership Units
Outstanding | $        0 
-----------
0 
-----------
8,455 
8,789 
1,593 
1,192 
-----------
20,029 
-----------
(20,029)
(26,023)
3,663 
-----------
$  (42,389)
===========
$  (41,965)
(424)
-----------
$  (42,389)
===========
$    (8.32)
===========
5,043 
=========== | $      750 
-----------
750 
-----------
8,472 
5,646 
884 
1,145 
-----------
16,147 
-----------
(15,397)
(51,815)
3,427 
-----------
$  (63,785)
===========
$  (63,147)
(638)
-----------
$  (63,785)
===========
$   (12.52)
===========
5,043 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 2005
----                                                                                                                                                                                                                                                          | 2004
----                                                                                                                                                                                                                                                     
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
 Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited Partnership
Units
Number of Limited Partnership Units
Outstanding | $      600 
-----------
600 
-----------
7,005 
7,031 
1,302 
1,477 
-----------
16,815 
-----------
(16,215)
(34,536)
4,655 
-----------
$  (46,096)
===========
$  (45,635)
(461)
-----------
$  (46,096)
===========
$    (8.90)
===========
5,127 
=========== | $        0 
-----------
0 
-----------
7,063 
4,517 
921 
1,683 
-----------
14,184 
-----------
(14,184)
(24,973)
3,915 
-----------
$  (35,242)
===========
$  (34,890)
(352)
-----------
$  (35,242)
===========
$    (6.81)
===========
5,127 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31,
(Unaudited)

|TOTAL SERIES 7 - 11                                                                                                                                                                                                                                                                                                                                                                         | 2005
----                                                                                                                                                                                                                         | 2004
----                                                                                                                                                                                                                         
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
 Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners | $    7,006 
-----------
7,006 
-----------
71,926 
77,926 
10,091 
5,049 
-----------
164,992 
-----------
(157,986)
(95,548)
25,130 
-----------
$ (228,404)
===========
$ (226,120)
(2,284)
-----------
$ (228,404)
=========== | $   13,979 
-----------
13,979 
-----------
72,228 
50,058 
6,762 
6,028 
-----------
135,076 
-----------
(121,097)
(127,162)
22,429 
-----------
$ (225,830)
===========
$ (223,572)
(2,258)
-----------
$ (225,830)
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 2005
----                                                                                                                                                                                                                                                                      | 2004
----                                                                                                                                                                                                                                                                      
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited Partnership
Units
Number of Limited Partnership Units
Outstanding | $   16,934 
-----------
16,934 
-----------
64,836 
61,853 
18,331 
4,325 
-----------
149,345 
-----------
(132,411)
(54,069)
19,636 
-----------
$ (166,844)
===========
$ (165,176)
(1,668)
-----------
$ (166,844)
===========
$   (15.89)
===========
10,395 
=========== | $   16,981 
-----------
16,981 
-----------
65,061 
41,794 
13,851 
4,983 
-----------
125,689 
-----------
(108,708)
(101,579)
16,843 
-----------
$ (193,444)
===========
$ (191,510)
(1,934)
-----------
$ (193,444)
===========
$   (18.42)
===========
10,395 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 2005
----                                                                                                                                                                                                                                                                        | 2004
----                                                                                                                                                                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
 Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Income (Losses) of   Project Partnerships and Other Income
Equity in Income (Losses) of Project  Partnerships
Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited
Partnership Units
Number of Limited Partnership Units
Outstanding | $   11,416 
-----------
11,416 
-----------
67,431 
68,198 
19,791 
1,701 
-----------
157,121 
-----------
(145,705)
11,698 
17,037 
-----------
$  (116,970)
===========
$  (115,800)
(1,170)
-----------
$  (116,970)
===========
$    (11.60)
===========
9,980 
=========== | $   13,540 
-----------
13,540 
-----------
67,734 
46,081 
14,690 
2,304 
-----------
130,809 
-----------
(117,269)
(43,185)
15,237 
-----------
$  (145,217)
===========
$  (143,765)
(1,452)
-----------
$  (145,217)
===========
$    (14.41)
===========
9,980 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 2005
----                                                                                                                                                                                                                                                                  | 2004
----                                                                                                                                                                                                                                                               
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
 Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited Partnership
Units
Number of Limited Partnership Units
Outstanding | $    3,837 
-----------
3,837 
-----------
37,131 
38,064 
11,221 
1,782 
-----------
88,198 
-----------
(84,361)
(74,413)
11,704 
-----------
$ (147,070)
===========
$ (145,599)
(1,471)
-----------
$ (147,070)
===========
$   (23.28)
===========
6,254 
=========== | $    5,413 
-----------
5,413 
-----------
37,284 
25,720 
8,472 
2,313 
-----------
73,789 
-----------
(68,376)
(92,103)
9,822 
-----------
$ (150,657)
===========
$ (149,150)
(1,507)
-----------
$ (150,657)
===========
$   (23.85)
===========
6,254 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 2005
----                                                                                                                                                                                                                                                                 | 2004
----                                                                                                                                                                                                                                                                
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
 Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited Partnership
Units
Number of Limited Partnership Units
Outstanding | $    1,380 
-----------
1,380 
-----------
25,365 
23,790 
8,069 
3,575 
-----------
60,799 
-----------
(59,419)
(80,447)
10,558 
-----------
$ (129,308)
===========
$ (128,015)
(1,293)
-----------
$ (129,308)
===========
$   (25.38)
===========
5,043 
=========== | $    2,830 
-----------
2,830 
-----------
25,416 
16,075 
5,975 
3,435 
-----------
50,901 
-----------
(48,071)
(125,938)
9,801 
-----------
$ (164,208)
===========
$ (162,566)
(1,642)
-----------
$ (164,208)
===========
$   (32.24)
===========
5,043 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 2005
----                                                                                                                                                                                                                                                                 | 2004
----                                                                                                                                                                                                                                                                
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
 Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners
Net Loss Per Number of Limited Partnership
Units
Number of Limited Partnership Units
Outstanding | $    2,782 
-----------
2,782 
-----------
21,015 
19,032 
7,681 
4,431 
-----------
52,159 
-----------
(49,377)
(91,094)
13,305 
-----------
$ (127,166)
===========
$ (125,894)
(1,272)
-----------
$ (127,166)
===========
$   (24.56)
===========
5,127 
=========== | $    2,782 
-----------
2,782 
-----------
21,189 
12,860 
5,273 
5,049 
-----------
44,371 
-----------
(41,589)
(73,087)
11,427 
-----------
$ (103,249)
===========
$ (102,217)
(1,032)
-----------
$ (103,249)
===========
$   (19.94)
===========
5,127 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|TOTAL SERIES 7 - 11                                                                                                                                                                                                                                                                                                                                                                         | 2005
----                                                                                                                                                                                                                              | 2004
----                                                                                                                                                                                                                             
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenues:
 Distribution Income
  Total Revenues
Expenses:
 Asset Management Fee-General Partner
 General and Administrative:
  General Partner
  Other
 Amortization
  Total Expenses
Loss Before Equity in Losses of Project
 Partnerships and Other Income
Equity in Losses of Project Partnerships
 Interest Income
Net Loss
Allocation of Net Loss:
 Limited Partners
 General Partners | $   36,349 
-----------
36,349 
-----------
215,778 
210,937 
65,093 
15,814 
-----------
507,622 
-----------
(471,273)
(288,325)
72,240 
-----------
$ (687,358)
===========
$ (680,484)
(6,874)
-----------
$ (687,358)
=========== | $   41,546 
-----------
41,546 
-----------
216,684 
142,530 
48,261 
18,084 
-----------
425,559 
-----------
(384,013)
(435,892)
63,130 
-----------
$ (756,775)
===========
$ (749,208)
(7,567)
-----------
$ (756,775)
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE NINE MONTHS ENDED DECEMBER 31, 2005 AND 2004:

|SERIES 7                                                                                                                        | Limited
Partners
---------                                                                                                  | General
Partners
--------                                                                                         | Total
-----                                                                                                               
|------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------
|Balance at March 31, 2004
Net Loss
Balance at December 31, 2004
Balance at March 31, 2005
Net Loss
Balance at December 31, 2005 | $ 1,290,808 
(191,510)
------------
$ 1,099,298 
============
$ 1,031,936 
(165,176)
------------
$   866,760 
============ | $  (79,162)
(1,934)
-----------
$  (81,096)
===========
$  (81,777)
(1,668)
------------
$  (83,445)
============ | $ 1,211,646 
(193,444)
-----------
$ 1,018,202 
============
$   950,159 
(166,844)
------------
$   783,315 
============



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE NINE MONTHS ENDED DECEMBER 31, 2005 AND 2004:

|SERIES 8                                                                                                                        | Limited
Partners
---------                                                                                                  | General
Partners
--------                                                                                         | Total
-----                                                                                                               
|------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------
|Balance at March 31, 2004
Net Loss
Balance at December 31, 2004
Balance at March 31, 2005
Net Loss
Balance at December 31, 2005 | $   635,468 
(143,765)
------------
$   491,703 
============
$   458,094 
(115,800)
------------
$   342,294 
============ | $  (82,091)
(1,452)
-----------
$  (83,543)
===========
$  (83,883)
(1,170)
------------
$  (85,053)
============ | $   553,377 
(145,217)
-----------
$   408,160 
============
$   374,211 
(116,970)
------------
$   257,241 
============



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE NINE MONTHS ENDED DECEMBER 31, 2005 AND 2004:

|SERIES 9                                                                                                                        | Limited
Partners
---------                                                                                                  | General
Partners
--------                                                                                         | Total
-----                                                                                                            
|------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------
|Balance at March 31, 2004
Net Loss
Balance at December 31, 2004
Balance at March 31, 2005
Net Loss
Balance at December 31, 2005 | $ 1,055,258 
(149,150)
------------
$   906,108 
============
$   822,760 
(145,599)
------------
$   677,161 
============ | $  (44,731)
(1,507)
-----------
$  (46,238)
===========
$  (47,079)
(1,471)
------------
$  (48,550)
============ | $1,010,527 
(150,657)
------------
$  859,870 
============
$  775,681 
(147,070)
------------
$  628,611 
============



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE NINE MONTHS ENDED DECEMBER 31, 2005 AND 2004:

|SERIES 10                                                                                                                       | Limited
Partners
---------                                                                                                  | General
Partners
--------                                                                                         | Total
-----                                                                                                                
|------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------
|Balance at March 31, 2004
Net Loss
Balance at December 31, 2004
Balance at March 31, 2005
Net Loss
Balance at December 31, 2005 | $ 2,115,390 
(162,566)
------------
$ 1,952,824 
============
$ 1,930,927 
(128,015)
------------
$ 1,802,912 
============ | $  (23,258)
(1,642)
-----------
$  (24,900)
===========
$  (25,121)
(1,293)
------------
$  (26,414)
============ | $ 2,092,132 
(164,208)
------------
$ 1,927,924 
============
$ 1,905,806 
(129,308)
------------
$ 1,776,498 
============



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE NINE MONTHS ENDED DECEMBER 31, 2005 AND 2004:

|SERIES 11                                                                                                                       | Limited
Partners
---------                                                                                                  | General
Partners
--------                                                                                         | Total
-----                                                                                                               
|------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------
|Balance at March 31, 2004
Net Loss
Balance at December 31, 2004
Balance at March 31, 2005
Net Loss
Balance at December 31, 2005 | $ 3,202,252 
(102,217)
------------
$ 3,100,035 
============
$ 3,049,825 
(125,894)
------------
$ 2,923,931 
============ | $  (14,109)
(1,032)
-----------
$  (15,141)
===========
$  (15,649)
(1,272)
------------
$  (16,921)
============ | $ 3,188,143 
(103,249)
-----------
$ 3,084,894 
============
$ 3,034,176 
(127,166)
------------
$ 2,907,010 
============



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE NINE MONTHS ENDED DECEMBER 31, 2005 AND 2004:

|TOTAL SERIES 7 - 11                                                                                                             | Limited
Partners
---------                                                                                                  | General
Partners
--------                                                                                         | Total
-----                                                                                                               
|------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------
|Balance at March 31, 2004
Net Loss
Balance at December 31, 2004
Balance at March 31, 2005
Net Loss
Balance at December 31, 2005 | $ 8,299,176 
(749,208)
------------
$ 7,549,968 
============
$ 7,293,542 
(680,484)
------------
$ 6,613,058 
============ | $ (243,351)
(7,567)
-----------
$ (250,918)
===========
$ (253,509)
(6,874)
------------
$ (260,383)
============ | $ 8,055,825 
(756,775)
-----------
$ 7,299,050 
============
$ 7,040,033 
(687,358)
------------
$ 6,352,675 
============



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 7
--------                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 2005
----                                                                                                                                                                      | 2004
----                                                                                                                                                                      
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash Flows from Operating Activities:
  Net Loss
  Adjustments to Reconcile Net Loss to Net
  Cash Used in Operating Activities:
   Amortization
   Accreted Interest Income on Investments
   in Securities
   Equity in Losses of Project Partnerships
   Distribution Income
   Changes in Operating Assets and Liabilities:
    Increase in Payable to General Partners
     Net Cash Used in Operating Activities
Cash Flows from Investing Activities:
 Distributions Received from Project
 Partnerships
     Net Cash Provided by Investing
     Activities
Decrease in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of
Year
Cash and Cash Equivalents at End of Period | $ (166,844)
4,325 
(12,068)
54,069 
(16,934)
65,431 
----------
(72,021)
----------
21,972 
----------
21,972 
----------
(50,049)
383,342 
----------
$  333,293 
=========== | $ (193,444)
4,983 
(14,937)
101,579 
(16,731)
62,290 
----------
(56,260)
----------
23,983 
----------
23,983 
----------
(32,277)
343,873 
----------
$  311,596 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWSFOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 8
--------                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 2005
----                                                                                                                                                                        | 2004
----                                                                                                                                                                       
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash Flows from Operating Activities:
  Net Loss
  Adjustments to Reconcile Net Loss to Net
  Cash Used In Operating Activities:
   Amortization
   Accreted Interest Income on Investments
   in Securities
   Equity in (Income) Losses of Project
   Partnerships
   Distribution Income
   Changes in Operating Assets and Liabilities:
    Increase in Payable to General Partners
     Net Cash Used in Operating Activities
Cash Flows from Investing Activities:
 Distributions Received from Project
 Partnerships
     Net Cash Provided by Investing
     Activities
Decrease in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of
Year
Cash and Cash Equivalents at End of Period | $ (116,970)
1,701 
(10,826)
(11,698)
(11,416)
67,368 
----------
(81,841)
----------
14,481 
----------
14,481 
----------
(67,360)
325,662 
-----------
$  258,302 
=========== | $ (145,217)
2,304 
(13,364)
43,185 
(13,540)
4,271 
----------
(122,361)
----------
13,986 
----------
13,986 
----------
(108,375)
373,899 
-----------
$  265,524 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 9
--------                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2005
----                                                                                                                                                                     | 2004
----                                                                                                                                                                     
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash Flows from Operating Activities:
  Net Loss
  Adjustments to Reconcile Net Loss to Net
  Cash Used in Operating Activities:
   Amortization
   Accreted Interest Income on Investments
   in Securities
   Equity in Losses of Project Partnerships
   Distribution Income
   Changes in Operating Assets and Liabilities:
    Decrease in Accounts Receivable
    Increase in Payable to General Partners
     Net Cash Used in Operating Activities
Cash Flows from Investing Activities:
  Distributions Received from Project
  Partnerships
     Net Cash Provided by Investing
     Activities
Decrease in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of
Year
Cash and Cash Equivalents at End of Period | $ (147,070)
1,782 
(7,256)
74,413 
(3,837)
0 
37,442 
----------
(44,526)
----------
8,505 
----------
8,505 
----------
(36,021)
229,897 
----------
$  193,876 
=========== | $ (150,657)
2,313 
(8,532)
92,103 
(5,413)
600 
5,610 
----------
(63,976)
----------
8,918 
----------
8,918 
----------
(55,058)
248,902 
----------
$  193,844 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 10
--------                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 2005
----                                                                                                                                                                  | 2004
----                                                                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash Flows from Operating Activities:
  Net Loss
  Adjustments to Reconcile Net Loss to Net
  Cash Used in Operating Activities:
   Amortization
   Accreted Interest Income on Investments
   in Securities
   Equity in Losses of Project Partnerships
   Distribution Income
   Changes in Operating Assets and Liabilities:
    Increase (Decrease) in Payable to General     Partners
     Net Cash Used in Operating Activities
Cash Flows from Investing Activities:
  Distributions Received from Project
  Partnerships
     Net Cash Provided by Investing
     Activities
Decrease in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of
Year
Cash and Cash Equivalents at End of Period | $ (129,308)
3,575 
(7,753)
80,447 
(1,380)
25,364 
----------
(29,055)
----------
7,426 
----------
7,426 
----------
(21,629)
142,638 
----------
$  121,009 
=========== | $ (164,208)
3,435 
(8,678)
125,938 
(2,830)
(100,749)
----------
(147,092)
----------
13,979 
----------
13,979 
----------
(133,113)
247,847 
----------
$  114,734 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|SERIES 11
--------                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 2005
----                                                                                                                                                                         | 2004
----                                                                                                                                                                                
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash Flows from Operating Activities:
  Net Loss
  Adjustments to Reconcile Net Loss to Net
  Cash Used in Operating Activities:
   Amortization
   Accreted Interest Income on Investments
   in Securities
   Equity in Losses of Project Partnerships
   Distribution Income
   Changes in Operating Assets and Liabilities:
    Decrease (Increase) in Accounts Receivable
    Increase (Decrease) in Payable to General     Partners
     Net Cash Used in Operating Activities
Cash Flows from Investing Activities:
   Distributions Received from Project
   Partnerships
     Net Cash Provided by Investing
     Activities
Decrease in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of
Year
Cash and Cash Equivalents at End of Period | $ (127,166)
4,431 
(9,271)
91,094 
(2,782)
8,291 
12,527 
----------
(22,876)
----------
7,054 
----------
7,054 
----------
(15,822)
199,931 
----------
$  184,109 
=========== | $ (103,249)
5,049 
(10,391)
73,087 
(2,782)
(136,000)
(7,927)
----------
(182,213)
----------
15,066 
----------
15,066 
----------
(167,147)
247,638 
----------
$   80,491 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED DECEMBER 31,
(Unaudited)

|TOTAL SERIES 7 - 11
-------------------                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 2005
----                                                                                                                                                                                     | 2004
----                                                                                                                                                                                       
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash Flows from Operating Activities:
  Net Loss
  Adjustments to Reconcile Net Loss to Net
  Cash Used in Operating Activities:
   Amortization
   Accreted Interest Income on Investments
   in Securities
   Equity in Losses of Project Partnerships
   Distribution Income
   Changes in Operating Assets and Liabilities:
    Decrease (Increase) in Accounts Receivable
    Increase (Decrease) in Payable to General     Partners
     Net Cash Used in Operating Activities
Cash Flows from Investing Activities:
   Distributions Received from Project
   Partnerships
     Net Cash Provided by Investing
     Activities
Decrease in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of
Year
Cash and Cash Equivalents at End of Period | $  (687,358)
15,814 
(47,174)
288,325 
(36,349)
8,291 
208,132 
----------
(250,319)
----------
59,438 
----------
59,438 
----------
(190,881)
1,281,470 
----------
$1,090,589 
=========== | $  (756,775)
18,084 
(55,902)
435,892 
(41,296)
(135,400)
(36,505)
----------
(571,902)
----------
75,932 
----------
75,932 
----------
(495,970)
1,462,159 
----------
$  966,189 
===========



See accompanying notes to financial statements.

---

GATEWAY TAX CREDIT FUND III LTD.(A Florida Limited Partnership)NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2005

NOTE 1 - ORGANIZATION:   Gateway Tax Credit Fund III Ltd. ("Gateway"), a Florida Limited Partnership, was formed October 17, 1991 under the laws of Florida.  Gateway offered its limited partnership interests in Series.  The first Series for Gateway is Series 7.  Operations commenced on July 16, 1992 for Series 7, January 4, 1993 for Series 8, September 30, 1993 for Series 9, January 21, 1994 for Series 10 and April 29, 1994 for Series 11.  Each Series invests, as a limited partner, in other limited partnerships ("Project Partnerships"), each of which owns and operates apartment complexes eligible for Low-Income Housing Tax Credits ("Tax Credits"), provided for in Section 42 of the Internal Revenue Code of 1986.  Gateway will terminate on December 31, 2040 or sooner, in accordance with the terms of the Limited Partnership Agreement.  As of December 31, 2005, Gateway had received capital contributions of $1,000 from the General Partners and $36,799,000 from the investor Limited Partners.
   Raymond James Partners, Inc. and Raymond James Tax Credit Funds, Inc., wholly-owned subsidiaries of Raymond James Financial, Inc., are the General Partner and Managing General Partner, respectively.
   Gateway received capital contributions of $10,395,000, $9,980,000, $6,254,000, $5,043,000 and $5,127,000 from the investor Limited Partners in Series 7, 8, 9, 10 and 11, respectively.  Each Series will be treated as though it were a separate partnership, investing in a separate and distinct pool of Project Partnerships.  Income or loss and all tax items from the Project Partnerships acquired by each Series will be specifically allocated among the limited partners of such Series.
   Operating profits and losses, cash distributions from operations and Tax Credits from each Series are generally allocated 99% to the Limited Partners in that Series and 1% to the General Partners.  Profit or loss and cash distributions from sales of property by each Series are allocated as formulated in the Limited Partnership Agreement.NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting   Gateway utilizes an accrual basis of accounting whereby revenues are recognized as earned and expenses are recognized as obligations are incurred.
   Gateway accounts for its investments as the limited partner in Project Partnerships ("Investments in Project Partnerships"), using the equity method of accounting, because management believes that Gateway does not have a majority control of the major operating and financial policies of the Project Partnerships in which it invests, and reports the equity in losses of the Project Partnerships on a 3-month lag in the Statement of Operations.  Under the equity method, the Investments in Project Partnerships initially include:
   1)  Gateway's capital contribution,
   2)  Acquisition fees paid to the General Partner for services rendered
       selecting properties for acquisition, and
   3)  Acquisition expenses including legal fees, travel and other
       miscellaneous costs relating to acquiring properties.Quarterly the Investments in Project Partnerships are increased or decreased as follows:
   1)  Increased for equity in income or decreased for equity in losses of
       the Project Partnerships,
   2)  Decreased for cash distributions received from the Project
       Partnerships, and
   3)  Decreased for the amortization of the acquisition fees and expenses.
   Amortization is calculated on a straight-line basis over 35 years, as this is the average estimated useful life of the underlying assets.  The amortization is shown as amortization expense on the Statements of Operations.
   Pursuant to the limited partnership agreements for the Project Partnerships, cash losses generated by the Project Partnerships are allocated to the general partners of those partnerships.  In subsequent years, cash profits, if any, are first allocated to the general partners to the extent of the allocation of prior years' cash losses.
   Since Gateway invests as a limited partner, and therefore is not obligated to fund losses or make additional capital contributions, it does not recognize losses from individual Project Partnerships to the extent that these losses would reduce the investment in those Project Partnerships below zero.  The suspended losses will be used to offset future income from the individual Project Partnerships.
   Gateway reviews its investments in Project Partnerships to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable.  If the sum of the expected future cash flows is less than the carrying amount of the investment, Gateway recognizes an impairment loss.  No impairment loss has been recognized in the accompanying financial statements.
   Gateway, as a limited partner in the Project Partnerships, is subject to risks inherent in the ownership of property which are beyond its control, such as fluctuations in occupancy rates and operating expenses, variations in rental schedules, proper maintenance and continued eligibility of tax credits.  If the cost of operating a property exceeds the rental income earned thereon, Gateway may deem it in its best interest to voluntarily provide funds in order to protect its investment.  Gateway does not guarantee any of the mortgages or other debt of the Project Partnerships.Cash and Cash Equivalents   It is Gateway's policy to include short-term investments with an original maturity of three months or less in Cash and Cash Equivalents.  Short-term investments are comprised of money market mutual funds.

---

NOTE 3 - INVESTMENT IN SECURITIES:   The December 31, 2005 Balance Sheets include Investment in Securities consisting of U.S. Treasury Security Strips which represents their cost, plus accreted interest income of $140,513 for Series 7, $125,941 for Series 8, $84,332 for Series 9, $84,823 for Series 10 and $98,916 for Series 11.

|          | Estimated  Market
Value
---------- | Cost Plus 
Accreted 
Interest
-------------- | Gross Unrealized
Gains and 
(Losses)
--------------
|--------- | ---------------------------------- | -------------------------------------------- | ---------------------------------------------------
|Series 7  | $  232,281                         | $  224,839                                   | $   7,442                                          
|Series 8  | 219,844                            | 213,501                                      | 6,343                                              
|Series 9  | 163,869                            | 158,725                                      | 5,144                                              
|Series 10 | 157,297                            | 149,954                                      | 7,343                                              
|Series 11 | 182,054                            | 170,445                                      | 11,609                                             

As of December 31, 2005, the cost and accreted interest of debt securities by contractual maturities is as follows:

|                                        | Series 7
--------   | Series 8
--------   | Series 9
--------  
|--------------------------------------- | ------------------- | ------------------- | -------------------
|Due within 1 year                       | $  76,505           | $  71,497           | $  40,714          
|After 1 year through 5 years            | 148,334             | 142,004             | 118,011            
|                                        | ---------           | ---------           | ---------          
|Total Amount Carried on
  Balance Sheet | $ 224,839
========= | $ 213,501
========= | $ 158,725
=========



|                                        | Series 10
--------  | Series 11
--------  | Total
--------       
|--------------------------------------- | ------------------- | ------------------- | ---------------------
|Due within 1 year                       | $  31,055           | $  35,749           | $  255,520           
|After 1 year through 5 years            | 118,899             | 134,696             | 661,944              
|                                        | ---------           | ---------           | ---------            
|Total Amount Carried on
  Balance Sheet | $ 149,954
========= | $ 170,445
========= | $  917,464
==========

---

NOTE 4 - RELATED PARTY TRANSACTIONS:   The Payable to General Partners primarily represents the asset management fees owed to the General Partners at the end of the period.  It is unsecured, due on demand and, in accordance with the limited partnership agreement, non-interest bearing.  Within the next 12 months, the Managing General Partner does not intend to demand payment on the portion of Asset Management Fees payable classified as long-term on the Balance Sheet.
   Value Partners, Inc., an affiliate of Gateway, acquired the general partner interest in Logan Heights, one of the Project Partnerships in Series 8, in 2003.
   For the nine months ended December 31, 2005 and 2004, the General Partners and affiliates are entitled to compensation and reimbursement for costs and expenses incurred by Gateway as follows:   Asset Management Fee - The Managing General Partner is entitled to receive an annual asset management fee equal to the greater of (i) $2,000 for each limited partnership in which Gateway invests, or (ii) 0.275% of Gateway's gross proceeds from the sale of limited partnership interests.  In either event (i) or (ii), the maximum amount may not exceed 0.2% of the aggregate cost (Gateway's capital contribution plus Gateway's share of the Properties' mortgage) of Gateway's interest in properties owned by the Project Partnerships.  The asset management fee will be paid only after all other expenses of Gateway have been paid.  These fees are included in the Statement of Operations. 
                           2005             2004
                          -----	            -----
  Series 7              $ 64,836         $ 65,061
  Series 8                67,431           67,734
  Series 9                37,131           37,284
  Series 10               25,365           25,416
  Series 11               21,015	           21,189
                        --------         --------
  Total                 $215,778         $216,684
                        ========	         ========
   General and Administrative Expenses - The Managing General Partner is reimbursed for general and administrative expenses of Gateway on an accountable basis.  This expense is included in the Statement of Operations.
  Series 7             $  61,853        $  41,794
  Series 8                68,198           46,081
  Series 9                38,064           25,720
  Series 10               23,790           16,075
  Series 11               19,032           12,860
                        --------         --------
  Total                 $210,937	         $142,530
                        ========         ========

---



|SERIES 7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | DECEMBER 31,
2005
-------------                                                                                  | MARCH 31,
2005
------------                                                                                    
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------
|Capital Contributions to Project Partnerships and purchase price paid for limited partner interests in Project Partnerships
Cumulative equity in losses of Project Partnerships (1)
Cumulative distributions received from Project Partnerships
Investment in Project Partnerships before adjustment
Excess of investment cost over the underlying assets acquired:
 Acquisition fees and expenses
 Accumulated amortization of acquisition
 fees and expenses
Investments in Project Partnerships | $ 7,732,089 
(7,186,188)
(239,053)
-----------
306,848 
793,335 
(197,960)
-----------
$   902,223 
============ | $ 7,732,089 
(7,132,119)
(234,015)
-----------
365,955 
793,335 
(193,635)
-----------
$   965,655 
===========

(1) In accordance with the Partnership's accounting policy to not carry Investments in Project Partnerships below zero, cumulative suspended losses of $4,575,379 for the period ended December 31, 2005 and cumulative suspended losses of $4,140,409 for the year ended March 31, 2005 are not included.

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   As of December 31, 2005, the Partnership had acquired a 99% interest in the profits, losses and tax credits as a limited partner in 43 Project Partnerships which own and operate government assisted multi-family housing complexes.  Cash flows from operations are allocated according to each Partnership agreement.  Upon dissolution proceeds will be distributed according to each Partnership agreement.
   The following is a summary of Investments in Project Partnerships as of:

|SERIES 8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | DECEMBER 31,
2005
------------                                                                                 | MARCH 31,
2005
-------------                                                                                  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------
|Capital Contributions to Project Partnerships and purchase price paid for limited partner interests in Project Partnerships
Cumulative equity in losses of Project Partnerships (1)
Cumulative distributions received from Project Partnerships
Investment in Project Partnerships before adjustment
Excess of investment cost over the underlying assets acquired:
 Acquisition fees and expenses
 Accumulated amortization of acquisition
 fees and expenses
Investments in Project Partnerships | $ 7,586,105 
(7,373,057)
(174,578)
-----------
38,470 
549,773 
(120,150)
-----------
$   468,093 
=========== | $ 7,586,105 
(7,384,755)
(171,513)
-----------
29,837 
549,773 
(118,449)
-----------
$   461,161 
===========

(1) In accordance with the Partnership's accounting policy to not carry Investments in Project Partnerships below zero, cumulative suspended losses of $5,320,529 for the period ended December 31, 2005 and cumulative suspended losses of $4,846,424 for the year ended March 31, 2005 are not included.

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   As of December 31, 2005, the Partnership had acquired a 99% interest in the profits, losses and tax credits as a limited partner in 24 Project Partnerships which own and operate government assisted multi-family housing complexes.  Cash flows from operations are allocated according to each Partnership agreement.  Upon dissolution proceeds will be distributed according to each Partnership agreement.
   The following is a summary of Investments in Project Partnerships as of:

|SERIES 9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | DECEMBER 31,
2005
------------                                                                                  | MARCH 31,
2005
-------------                                                                                   
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------
|Capital Contributions to Project Partnerships and purchase price paid for limited partner interests in Project Partnerships
Cumulative equity in losses of Project Partnerships (1)
Cumulative distributions received from Project Partnerships
Investment in Project Partnerships before adjustment
Excess of investment cost over the underlying assets acquired:
 Acquisition fees and expenses
 Accumulated amortization of acquisition
 fees and expenses
Investments in Project Partnerships | $ 4,914,116 
(4,232,785)
(146,461)
-----------
534,870 
244,087 
(60,958)
-----------
$   717,999 
============ | $ 4,914,116 
(4,158,372)
(141,793)
-----------
613,951 
244,087 
(59,176)
-----------
$   798,862 
============

(1) In accordance with the Partnership's accounting policy to not carry Investments in Project Partnerships below zero, cumulative suspended losses of $1,718,019 for the period ended December 31, 2005 and cumulative suspended losses of $1,528,748 for the year ended March 31, 2005 are not included.

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   As of December 31, 2005, the Partnership had acquired a 99% interest in the profits, losses and tax credits as a limited partner in 15 Project Partnerships which own and operate government assisted multi-family housing complexes.  Cash flows from operations are allocated according to each Partnership agreement.  Upon dissolution proceeds will be distributed according to each Partnership agreement.
   The following is a summary of Investments in Project Partnerships as of:

|SERIES 10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | DECEMBER 31,
2005
--------------                                                                                  | MARCH 31,
2005
-------------                                                                                     
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------
|Capital Contributions to Project Partnerships and purchase price paid for limited partner interests in Project Partnerships
Cumulative equity in losses of Project Partnerships (1)
Cumulative distributions received from Project Partnerships
Investment in Project Partnerships before adjustment
Excess of investment cost over the underlying assets acquired:
 Acquisition fees and expenses
 Accumulated amortization of acquisition
 fees and expenses
Investments in Project Partnerships | $ 3,914,672 
(2,287,814)
(190,438)
-----------
1,436,420 
196,738 
(62,177)
-----------
$ 1,570,981 
============ | $ 3,914,672 
(2,207,367)
(184,392)
-----------
1,522,913 
196,738 
(58,602)
-----------
$ 1,661,049 
============

(1) In accordance with the Partnership's accounting policy to not carry Investments in Project Partnerships below zero, cumulative suspended losses of $226,277 for the period ended December 31, 2005 and cumulative suspended losses of $205,788 for the year ended March 31, 2005 are not included.

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   As of December 31, 2005, the Partnership had acquired a 99% interest in the profits, losses and tax credits as a limited partner in 12 Project Partnerships which own and operate government assisted multi-family housing complexes.  Cash flows from operations are allocated according to each Partnership agreement.  Upon dissolution proceeds will be distributed according to each Partnership agreement.
   The following is a summary of Investments in Project Partnerships as of:

|SERIES 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | DECEMBER 31,
2005
-------------                                                                                   | MARCH 31,
2005
-------------                                                                                     
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------
|Capital Contributions to Project Partnerships and purchase price paid for limited partner interests in Project Partnerships
Cumulative equity in losses of Project Partnerships (1)
Cumulative distributions received from Project Partnerships
Investment in Project Partnerships before adjustment
Excess of investment cost over the underlying assets acquired:
 Acquisition fees and expenses
 Accumulated amortization of acquisition
 fees and expenses
Investments in Project Partnerships | $ 4,128,042 
(1,598,695)
(169,265)
-----------
2,360,082 
290,335 
(85,434)
-----------
$ 2,564,983 
============ | $ 4,128,042 
(1,507,601)
(164,993)
-----------
2,455,448 
290,335 
(81,003)
-----------
$ 2,664,780 
============

(1) In accordance with the Partnership's accounting policy to not carry Investments in Project Partnerships below zero, cumulative suspended losses of $503,412 for the period December 31, 2005 and cumulative suspended losses of $372,590 for the year ended March 31, 2005 are not included.

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   The following is a summary of Investments in Project Partnerships as of:

|TOTAL SERIES 7 - 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | DECEMBER 31,
2005
-------------                                                                                        | MARCH 31,
2005
------------                                                                                               
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------
|Capital Contributions to Project Partnerships and purchase price paid for limited partner interests in Project Partnerships
Cumulative equity in losses of Project Partnerships (1)
Cumulative distributions received from Project Partnerships
Investment in Project Partnerships before adjustment
Excess of investment cost over the underlying assets acquired:
 Acquisition fees and expenses
 Accumulated amortization of acquisition
 fees and expenses
Investments in Project Partnerships | $ 28,275,024 
(22,678,539)
(919,795)
-----------
4,676,690 
2,074,268 
(526,679)
-----------
$ 6,224,279 
============ | $ 28,275,024 
(22,390,214)
(896,706)
------------
4,988,104 
2,074,268 
(510,865)
------------
$  6,551,507 
=============

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   In accordance with the Partnership's policy of presenting the financial information of the Project Partnerships on a three-month lag, below is the summarized financial information for the Series' Project Partnerships as of September 30, of each year:

|SERIES 7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 2005
----                                                                                                                                                                                                                                                                                                                                                                                                                                   | 2004
----                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|SUMMARIZED BALANCE SHEETS
Assets:
  Current assets
  Investment properties, net
  Other assets
    Total assets
Liabilities and Partners' Equity:
  Current liabilities
  Long-term debt
    Total liabilities
Partners' equity (deficit)
  Limited Partner
  General Partners
    Total Partners' equity (deficit)
    Total liabilities and partners' equity
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income
Expenses:
  Operating expenses
  Interest expense
  Depreciation and amortization
    Total expenses
      Net loss
Other partners' share of net loss
Partnerships' share of net loss
Suspended losses
Equity in Losses of Project Partnerships | $ 4,200,963 
27,508,934 
22,941 
------------
$31,732,838 
============
$   612,063 
35,849,766 
------------
36,461,829 
------------
(4,418,046)
(310,945)
------------
(4,728,991)
------------
$31,732,838 
============
$ 3,728,754 
------------
2,526,726 
574,218 
1,121,789 
------------
4,222,733 
------------
$  (493,979)
============
$    (4,940)
============
$  (489,039)
434,970 
------------
$   (54,069)
============ | $ 3,935,960 
28,828,646 
19,448 
------------
$32,784,054 
============
$   625,720 
36,002,235 
------------
36,627,955 
------------
(3,583,727)
(260,174)
------------
(3,843,901)
------------
$32,784,054 
============
$ 3,632,467 
------------
2,437,225 
606,192 
1,099,942 
------------
4,143,359 
------------
$  (510,892)
============
$    (5,109)
============
$  (505,783)
404,204 
------------
$  (101,579)
============

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   In accordance with the Partnership's policy of presenting the financial information of the Project Partnerships on a three-month lag, below is the summarized financial information for the Series' Project Partnerships as of September 30, of each year:

|SERIES 8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 2005
----                                                                                                                                                                                                                                                                                                                                                                                                                                   | 2004
----                                                                                                                                                                                                                                                                                                                                                                                                                                  
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|SUMMARIZED BALANCE SHEETS
Assets:
  Current assets
  Investment properties, net
  Other assets
    Total assets
Liabilities and Partners' Equity:
  Current liabilities
  Long-term debt
    Total liabilities
Partners' equity (deficit)
  Limited Partner
  General Partners
    Total Partners' equity (deficit)
    Total liabilities and partners' equity
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income
Expenses:
  Operating expenses
  Interest expense
  Depreciation and amortization
    Total expenses
      Net loss
Other partners' share of net loss
Partnerships' share of net loss
Suspended losses
Equity in Income (Losses) of Project Partnerships | $ 4,122,380 
28,765,104 
88,332 
------------
$32,975,816 
============
$ 1,002,600 
37,745,148 
------------
38,747,748 
------------
(5,127,331)
(644,601)
------------
(5,771,932)
------------
$32,975,816 
============
$ 3,706,048 
------------
2,410,381 
630,611 
1,133,873 
------------
4,174,865 
------------
$  (468,817)
============
$    (6,410)
============
$  (462,407)
474,105 
------------
$    11,698 
============ | $ 3,780,670 
30,149,404 
49,357 
------------
$33,979,431 
============
$   991,808 
37,949,865 
------------
38,941,673 
------------
(4,307,429)
(654,813)
------------
(4,962,242)
------------
$33,979,431 
============
$ 3,618,208 
------------
2,338,094 
648,733 
1,183,519 
------------
4,170,346 
------------
$  (552,138)
============
$    (6,975)
============
$  (545,163)
501,978 
------------
$   (43,185)
============

(1)  An affiliate of the General Partner is the operating general partner in one of the Project Partnerships included above.  The Project Partnership's financial information for the periods ending September 2005 and September 2004 is as follows:

|                       | September 2005 | September 2004
|---------------------- | -------------- | --------------
|Total Assets           | $ 555,351      | $ 586,496     
|Total Liabilities      | 821,619        | 822,874       
|Gateway Equity         | (149,776)      | (120,185)     
|Other Partner's Equity | (116,492)      | (116,193)     
|Total Revenue          | 71,774         | 62,959        
|Net Loss               | $ (21,349)     | $ (15,064)    

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   In accordance with the Partnership's policy of presenting the financial information of the Project Partnerships on a three-month lag, below is the summarized financial information for the Series' Project Partnerships as of September 30, of each year:

|SERIES 9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 2005
----                                                                                                                                                                                                                                                                                                                                                                                                                                | 2004
----                                                                                                                                                                                                                                                                                                                                                                                                                             
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|SUMMARIZED BALANCE SHEETS
Assets:
  Current assets
  Investment properties, net
  Other assets
    Total assets
Liabilities and Partners' Equity:
  Current liabilities
  Long-term debt
    Total liabilities
Partners' equity (deficit)
  Limited Partner
  General Partners
    Total Partners' equity (deficit)
    Total liabilities and partners' equity
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income
Expenses:
  Operating expenses
  Interest expense
  Depreciation and amortization
    Total expenses
      Net loss
Other partners' share of net loss
Partnerships' share of net loss
Suspended losses
Equity in Losses of Project Partnerships | $ 2,150,867 
16,575,045 
4,254 
------------
$18,730,166 
============
$   221,997 
20,040,773 
------------
20,262,770 
------------
(1,224,161)
(308,443)
------------
(1,532,604)
------------
$18,730,166 
============
$ 1,886,526 
------------
1,239,414 
323,936 
589,523 
------------
2,152,873 
------------
$  (266,347)
============
$    (2,663)
============
$  (263,684)
189,271 
------------
$   (74,413)
============ | $ 1,993,172 
17,307,966 
3,774 
------------
$19,304,912 
============
$   193,710 
20,142,793 
------------
20,336,503 
------------
(754,990)
(276,601)
------------
(1,031,591)
------------
$19,304,912 
============
$ 1,896,337 
------------
1,201,257 
343,166 
624,399 
------------
2,168,822 
------------
$  (272,485)
============
$    (2,725)
============
$  (269,760)
177,657 
------------
$   (92,103)
============

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   In accordance with the Partnership's policy of presenting the financial information of the Project Partnerships on a three-month lag, below is the summarized financial information for the Series' Project Partnerships as of September 30, of each year:

|SERIES 10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 2005
----                                                                                                                                                                                                                                                                                                                                                                                                                         | 2004
----                                                                                                                                                                                                                                                                                                                                                                                                                          
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|SUMMARIZED BALANCE SHEETS
Assets:
  Current assets
  Investment properties, net
  Other assets
    Total assets
Liabilities and Partners' Equity:
  Current liabilities
  Long-term debt
    Total liabilities
Partners' equity (deficit)
  Limited Partner
  General Partners
    Total Partners' equity
    Total liabilities and partners' equity
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income
Expenses:
  Operating expenses
  Interest expense
  Depreciation and amortization
    Total expenses
      Net loss
Other partners' share of net loss
Partnerships' share of net loss
Suspended losses
Equity in Losses of Project Partnerships | $ 1,869,885 
12,300,953 
3,124 
------------
$14,173,962 
============
$   217,342 
13,126,101 
------------
13,343,443 
------------
1,210,659 
(380,140)
------------
830,519 
------------
$14,173,962 
============
$ 1,264,543 
------------
830,943 
184,065 
352,236 
------------
1,367,244 
------------
$  (102,701)
============
$    (1,765)
============
$  (100,936)
20,489 
------------
$   (80,447)
============ | $ 1,760,688 
12,664,446 
1,938 
------------
$14,427,072 
============
$   217,644 
13,161,837 
------------
13,379,481 
------------
1,386,151 
(338,560)
------------
1,047,591 
------------
$14,427,072 
============
$ 1,232,023 
------------
824,003 
190,350 
372,455 
------------
1,386,808 
------------
$  (154,785)
============
$    (2,878)
============
$  (151,907)
25,969 
------------
$  (125,938)
============

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   In accordance with the Partnership's policy of presenting the financial information of the Project Partnerships on a three-month lag, below is the summarized financial information for the Series' Project Partnerships as of September 30, of each year:

|SERIES 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 2005
----                                                                                                                                                                                                                                                                                                                                                                                                                             | 2004
----                                                                                                                                                                                                                                                                                                                                                                                                                            
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|SUMMARIZED BALANCE SHEETS
Assets:
  Current assets
  Investment properties, net
  Other assets
    Total assets
Liabilities and Partners' Equity:
  Current liabilities
  Long-term debt
    Total liabilities
Partners' equity (deficit)
  Limited Partner
  General Partners
    Total Partners' equity
    Total liabilities and partners' equity
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income
Expenses:
  Operating expenses
  Interest expense
  Depreciation and amortization
    Total expenses
      Net loss
Other partners' share of net loss
Partnerships' share of net loss
Suspended losses
Equity in Losses of Project Partnerships | $   954,838 
10,411,436 
325,945 
------------
$11,692,219 
============
$   129,904 
9,982,493 
------------
10,112,397 
------------
1,868,739 
(288,917)
------------
1,579,822 
------------
$11,692,219 
============
$ 1,166,090 
------------
857,233 
163,328 
382,935 
------------
1,403,496 
------------
$  (237,406)
============
$   (15,490)
============
$  (221,916)
130,822 
------------
$   (91,094)
============ | $ 1,180,607 
10,883,001 
190,875 
------------
$12,254,483 
============
$   173,542 
10,099,725 
------------
10,273,267 
------------
2,219,290 
(238,074)
------------
1,981,216 
------------
$12,254,483 
============
$ 1,160,682 
------------
777,941 
173,350 
386,514 
------------
1,337,805 
------------
$  (177,123)
============
$   (11,428)
============
$  (165,695)
92,608 
------------
$   (73,087)
============

---

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):   In accordance with the Partnership's policy of presenting the financial information of the Project Partnerships on a three-month lag, below is the summarized financial information for the Series' Project Partnerships as of September 30, of each year:

|TOTAL SERIES 7 - 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 2005
----                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2004
----                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|SUMMARIZED BALANCE SHEETS
Assets:
  Current assets
  Investment properties, net
  Other assets
    Total assets
Liabilities and Partners' Equity:
  Current liabilities
  Long-term debt
    Total liabilities
Partners' equity (deficit)
  Limited Partner
  General Partners
    Total Partners' equity (deficit)
    Total liabilities and partners' equity
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income
Expenses:
  Operating expenses
  Interest expense
  Depreciation and amortization
    Total expenses
      Net loss
Other partners' share of net loss
Partnerships' share of net loss
Suspended losses
Equity in Losses of Project Partnerships | $ 13,298,933 
95,561,472 
444,596 
------------
$109,305,001 
============
$  2,183,906 
116,744,281 
------------
118,928,187 
------------
(7,690,140)
(1,933,046)
------------
(9,623,186)
------------
$109,305,001 
============
$ 11,751,961 
------------
7,864,697 
1,876,158 
3,580,356 
------------
13,321,211 
------------
$ (1,569,250)
============
$    (31,268)
============
$ (1,537,982)
1,249,657 
------------
$   (288,325)
============ | $ 12,651,097 
99,833,463 
265,392 
------------
$112,749,952 
============
$  2,202,424 
117,356,455 
------------
119,558,879 
------------
(5,040,705)
(1,768,222)
------------
(6,808,927)
------------
$112,749,952 
============
$ 11,539,717 
------------
7,578,520 
1,961,791 
3,666,829 
------------
13,207,140 
------------
$ (1,667,423)
============
$    (29,115)
============
$ (1,638,308)
1,202,416 
------------
$   (435,892)
============

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Item 4.  Controls and Procedures:
   Within 90 days prior to the filing of this report, under the supervision and with the participation of the Partnership's management, including the Partnership's chief executive and chief financial officers, an evaluation of the effectiveness of the Partnership's disclosure controls and procedures (as defined in Rule 13a-14(c) under the Securities Exchange Act of 1934) was performed.  Based on this evaluation, such officers have concluded that the Partnership's disclosure controls and procedures were effective as of the date of that evaluation in alerting them in a timely manner to material information relating to the Partnership required to be included in this report and the Partnership's other reports that it files or submits under the Securities Exchange Act of 1934.  There were no significant changes in the Partnership's internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation.
Item 7.  Management's Discussion and Analysis of Financial Condition and Results of Operations 
Results of Operations, Liquidity and Capital Resources   The proceeds from Limited Partner investors' capital contributions available for investment are used to acquire interests in Project Partnerships.
   As disclosed on the statement of operations for each Series, interest income increased slightly from the nine and three months ended December 31, 2004 to the nine and three months ended December 31, 2005 due to an increase in interest rates throughout 2005.  Equity in Losses of Project Partnerships for the nine months ended December 31, 2005 decreased from $435,892 for the nine months ended December 31, 2004 to $288,325 as a result of a greater increase in rental and other income when compared with the corresponding increase in total expenses, combined with an increase in suspended losses for the period.  The General and Administrative Expenses - Other increased from $48,261 for the nine months ended December 31, 2004 to $65,093 as a result of timing differences of recording various expenses.  However, for the three months ended December 31, 2005 and 2004, these expenses were more comparable.  General and Administrative Expenses - General Partner was significantly higher due to increased administrative costs. Except as described above, there were no unusual variations in the operating results between these two periods.
   The capital resources of each Series are used to pay General and Administrative operating costs including personnel, supplies, data processing, travel and legal and accounting associated with the administration and monitoring of Gateway and the Project Partnerships.  The capital resources are also used to pay the Asset Management Fee due the Managing General Partner, but only to the extent that Gateway's remaining resources are sufficient to fund Gateway's ongoing needs.  (Payment of any Asset Management Fee unpaid at the time Gateway sells its interests in the Project Partnerships is subordinated to the investors' return of their original capital contribution.)
   The sources of funds to pay the operating costs of each Series are short-term investments and interest earned thereon, the maturity of U.S. Treasury Security Strips ("Zero Coupon Treasuries") which were purchased with funds set aside for this purpose, and cash distributed to the Series from the operations of the Project Partnerships.
   Series 7 - Gateway closed this series on October 16, 1992 after receiving $10,395,000 from 635 Limited Partner investors.  Equity in Losses of Project Partnerships for the nine months ended December 31, 2005 decreased from $101,579 for the nine months ended December 31, 2004 to $54,069 due to a higher increase in rental revenue than related total costs combined with an increase in suspended losses.  In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization.  (These Project Partnerships reported depreciation and amortization of $1,099,942 and $1,121,789 for the nine months ended September 30, 2004 and 2005, respectively.)  As a result, management expects that this Series, as well as those described below, will report its equity in Project Partnerships as a loss for tax and financial reporting purposes.  Overall, management believes the Project Partnerships are operating as expected and are generating tax credits which meet projections.
   At December 31, 2005, the Series had $333,293 of short-term investments (Cash and Cash Equivalents).  It also had $224,839 in Zero Coupon Treasuries with annual maturities providing $77,000 in fiscal year 2006 increasing to $86,000 in fiscal year 2008.  Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future and to pay part of the Asset Management Fee.
   As disclosed on the statement of cash flows, the Series had a net loss of $166,844 for the nine months ended December 31, 2005.  However, after adjusting for Equity in Losses of Project Partnerships of $54,069 and the changes in operating assets and liabilities, net cash used in operating activities was $72,021.  Cash provided by investing activities totaled $21,972, consisting of cash distributions from the Project Partnerships.  There were no unusual events or trends to describe.   Series 8 - Gateway closed this Series on September 28, 1993 after receiving $9,980,000 from 664 Limited Partner investors.  Equity in Losses of Project Partnerships for the nine months ended December 31, 2005 decreased from $43,185 for the nine months ended December 31, 2004 to income of $11,698 as a result of an increase in rental revenue.  (These Project Partnerships reported depreciation and amortization of $1,183,519 and $1,133,873 for the nine months ended September 30, 2004 and 2005, respectively.)  Overall, management believes the Project Partnerships are operating as expected and are generating tax credits which meet projections.
   At December 31, 2005, the Series had $258,302 of short-term investments (Cash and Cash Equivalents).  It also had $213,501 in Zero Coupon Treasuries with annual maturities providing $72,000 in fiscal year 2006 increasing to $82,000 in fiscal year 2008.  Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future and to pay part of the Asset Management Fee.
   As disclosed on the statement of cash flows, the Series had a net loss of $116,970 for the nine months ended December 31, 2005.  However, after adjusting for Equity in Income of Project Partnerships of $11,698 and the changes in operating assets and liabilities, net cash used in operating activities was $81,841.  Cash provided by investing activities totaled $14,481, consisting of cash distributions from the Project Partnerships.  There were no unusual events or trends to describe.   Series 9 - Gateway closed this Series on December 31, 1993 after receiving $6,254,000 from 406 Limited Partner investors.  Equity in Losses of Project Partnerships for the nine months ended December 31, 2005 decreased from $92,103 for the nine months ended December 31, 2004 to $74,413 as a result of an increase in suspended losses.  (These Project Partnerships reported depreciation and amortization of $624,399 and $589,523 for the nine months ended September 30, 2004 and 2005, respectively.)  Overall, management believes the Project Partnerships are operating as expected and are generating tax credits which meet projections.
   At December 31, 2005, the Series had $193,876 of short-term investments (Cash and Cash Equivalents).  It also had $158,725 in Zero Coupon Treasuries with annual maturities providing $41,000 in fiscal year 2006 increasing to $47,000 in fiscal year 2009.  Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future and to pay part of the Asset Management Fee.
   As disclosed on the statement of cash flows, the Series had a net loss of $147,070 for the nine months ended December 31, 2005.  However, after adjusting for Equity in Losses of Project Partnerships of $74,413 and the changes in operating assets and liabilities, net cash used in operating activities was $44,526.  Cash provided by investing activities totaled $8,505, consisting of cash distributions from the Project Partnerships.  There were no unusual events or trends to describe.
   Series 10 - Gateway closed this Series on January 21, 1994 after receiving $5,043,000 from 325 Limited Partner investors.  Equity in Losses of Project Partnerships for the nine months ended December 31, 2005 decreased from $125,938 for the nine months ended December 31, 2004 to $80,447 as a result of an increase in rental revenue combined with a decrease in total costs.  (These Project Partnerships reported depreciation and amortization of $372,455 and $352,236 for the nine months ended September 30, 2004 and 2005, respectively.) Overall, management believes the Project Partnerships are operating as expected and are generating tax credits which meet projections.
   At December 31, 2005, the Series had $121,009 of short-term investments (Cash and Cash Equivalents).  It also had $149,954 in Zero Coupon Treasuries with annual maturities providing $31,000 in fiscal year 2006 increasing to $40,000 in fiscal year 2010.  Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future and to pay part of the Asset Management Fee.
   As disclosed on the statement of cash flows, the Series had a net loss of $129,308 for the nine months ended December 31, 2005.  However, after adjusting for Equity in Losses of Project Partnerships of $80,447 and the changes in operating assets and liabilities, net cash used in operating activities was $29,055.  Cash provided by investing activities totaled $7,426, consisting of cash distributions from the Project Partnerships.  There were no unusual events or trends to describe.
   Series 11 - Gateway closed this Series on April 29, 1994 after receiving $5,127,000 from 330 Limited investors.  Equity in Losses of Project Partnerships for the nine months ended December 31, 2005 increased from $73,087 for the nine months ended December 31, 2004 to $91,094 as a result of an increase in operating expenses of the Project Partnerships, partially offset by an increase in suspended losses.  (These Project Partnerships reported depreciation and amortization of $386,514 and $382,935 for the nine months ended September 30, 2004 and 2005, respectively.)  Overall, management believes the Project Partnerships are operating as expected and are generating tax credits which meet projections.
   At December 31, 2005, the Series had $184,109 of short-term investments (Cash and Cash Equivalents).  It also had $170,445 in Zero Coupon Treasuries with annual maturities providing $36,000 in fiscal year 2006 increasing to $44,000 in fiscal year 2010.  Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future and to pay part of the Asset Management Fee.
   As disclosed on the statement of cash flows, the Series had a net loss of $127,166 for the nine months ended December 31, 2005.  However, after adjusting for Equity in Losses of Project Partnerships of $91,094 and the changes in operating assets and liabilities, net cash used in operating activities was $22,876.  Cash provided by investing activities totaled $7,054, consisting of cash distributions from Project Partnerships.  There were no unusual events or trends to describe.

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Exit Strategy
   The IRS compliance period for low-income housing tax credit properties is generally 15 years from occupancy following construction or rehabilitation completion.  With that in mind, the Partnership is continuing to review the Partnership's holdings, with special emphasis on the properties that are at or very near the satisfaction of the IRS compliance period requirements.  The Partnership's review considers many factors including extended use low-income housing regulation requirements on the property (such as those due to mortgage restrictions or state compliance agreements), the condition of the property, and the tax consequences to the investors from the sale of the property.
   Upon identifying those properties with the highest potential for a successful sale, refinancing or syndication, the Partnership expects to proceed with efforts to liquidate those properties.  The Partnership's objective is to maximize the investors' return wherever possible and, ultimately, to wind down those project partnerships that no longer provide tax benefits to investors.
   Gateway has no direct employees.  The General Partners have full and exclusive discretion in management and control of Gateway.

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SIGNATURES

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

GATEWAY TAX CREDIT FUND III, LTD.
                 (A Florida Limited Partnership)
                          By: Raymond James Tax Credit Funds, Inc.

Date: February 14, 2006           By:/s/ Ronald M. Diner                                  Ronald M. Diner
                                  President
Date: February 14, 2006           By:/s/ Jonathan Oorlog
                                  Jonathan Oorlog
                                  Vice President and Chief Financial Officer
Date: February 14, 2006           By:/s/ Sandra Humphreys
                                  Sandra Humphreys
                                  Secretary and Treasurer

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EXHIBIT 31.1
CERTIFICATIONS*

I, Ron Diner, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Gateway Tax Credit Fund III, Ltd.;
2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial information include in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
Date: February 14, 2006           By:/s/ Ronald M. Diner                                  Ronald M. Diner
                                  President

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EXHIBIT 31.2
CERTIFICATIONS*

I, Jonathan Oorlog, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Gateway Tax Credit Fund III, Ltd.;
2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial information include in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
Date: February 14, 2006           By:/s/ Jonathan Oorlog
                                  Jonathan Oorlog
                                  Vice President and Chief Financial Officer