----

----

| Gateway                Tax Credit Fund III                Ltd.                                                                                                                                                                                                                                                                                                 |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (Exact                name of Registrant as specified in its charter)                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                           |
|                       Florida                    (State                or other jurisdiction ofincorporation                or organization) |          59-3090386      (IRS                Employer No.) |
|                                                                                                                                                                                                                                                                                                                                                           |   |
|                 880                Carillon                Parkway          (Address                of principal executive offices)                                                                                          | St.                Petersburg,        Florida              33716                                                (Zip Code)  |
|                                                                                                                                                                                                                                                                                                                                                           |   |
| Registrant's                Telephone Number, Including Area Code                                                                                                                                                                                                                                                                                              |                   (727)                567-1000           |

| YES    X      | NO                             |
|------------------------------------------------------------|--------------------------------------------------------------------------------------------|

| Large                accelerated filer [ ] | Accelerated                filer [ ] | Non-accelerated                filer [X] |
|--------------------------------------------|--------------------------------------|------------------------------------------|

| Yes                  [ ] | No                   [X] |
|-----------------------------------------|-----------------------------------------|

----

----

| GATEWAY                TAX CREDIT FUND III                LTD.                                              |   |
|-------------------------------------------------------------------------------------------------------------|--------|
| (A                Florida Limited Partnership)                                                              |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| BALANCE                SHEETS                                                                               |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                        |   | SERIES                7 |   |   | SERIES                8 |   |   | SERIES                9 |   |
|                                                                                                        |   | December                31, |   |   | March                31, |   |   | December                31, |   |   | March                31, |   |   | December                31, |   |   | March                31, |   |
|                                                                                                        |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |
| ASSETS                                                                                                      |   | (Unaudited) |   |   | (Audited) |   |   | (Unaudited) |   |   | (Audited) |   |   | (Unaudited) |   |   | (Audited) |   |
| Current                Assets:                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Cash                and Cash Equivalents                                                  |   | $ | 92,078 |   |   | $ | 179,018 |   |   | $ | 82,957 |   |   | $ | 135,130 |   |   | $ | 32,233 |   |   | $ | 70,044 |   |
|    Investments                in Securities                                                  |   |   | 285,564 |   |   |   | 284,519 |   |   |   | 156,438 |   |   |   | 204,835 |   |   |   | 144,736 |   |   |   | 170,233 |   |
|                 Receivable - Other                                                                |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 24,220 |   |   |   | - |   |   |   | - |   |
|      Total                Current Assets                                           |   |   | 377,642 |   |   |   | 463,537 |   |   |   | 239,395 |   |   |   | 364,185 |   |   |   | 176,969 |   |   |   | 240,277 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Investments                in Securities                                                  |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 43,746 |   |   |   | 41,709 |   |
|    Investments                in Project Partnerships, net                                   |   |   | 409,885 |   |   |   | 442,787 |   |   |   | 362,519 |   |   |   | 377,733 |   |   |   | 345,136 |   |   |   | 412,287 |   |
|          Total                Assets                           |   | $ | 787,527 |   |   | $ | 906,324 |   |   | $ | 601,914 |   |   | $ | 741,918 |   |   | $ | 565,851 |   |   | $ | 694,273 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES                AND PARTNERS' EQUITY                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current                Liabilities:                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Payable                to General Partners                                                |   | $ | 56,677 |   |   | $ | 60,257 |   |   | $ | 47,606 |   |   | $ | 51,149 |   |   | $ | 27,306 |   |   | $ | 29,911 |   |
|      Total                Current Liabilities                                      |   |   | 56,677 |   |   |   | 60,257 |   |   |   | 47,606 |   |   |   | 51,149 |   |   |   | 27,306 |   |   |   | 29,911 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-Term                Liabilities:                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Payable                to General Partners                                                |   |   | 794,549 |   |   |   | 730,352 |   |   |   | 840,441 |   |   |   | 773,676 |   |   |   | 514,691 |   |   |   | 477,891 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Partners'                Equity (Deficit):                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Limited                Partners - 10,395, 9,980, and 6,254                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      units                for Series 7, 8, and 9, respectively,                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      at                December 31, 2007 and March 31, 2007                        |   |   | 28,216 |   |   |   | 205,836 |   |   |   | (195,647 | ) |   |   | 5,547 |   |   |   | 78,451 |   |   |   | 239,442 |   |
|    General                Partners                                                           |   |   | (91,915 | ) |   |   | (90,121 | ) |   |   | (90,486 | ) |   |   | (88,454 | ) |   |   | (54,597 | ) |   |   | (52,971 | ) |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Total                Partners' Equity (Deficit)                               |   |   | (63,699 | ) |   |   | 115,715 |   |   |   | (286,133 | ) |   |   | (82,907 | ) |   |   | 23,854 |   |   |   | 186,471 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|          Total                Liabilities and Partners' Equity |   | $ | 787,527 |   |   | $ | 906,324 |   |   | $ | 601,914 |   |   | $ | 741,918 |   |   | $ | 565,851 |   |   | $ | 694,273 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| See                accompanying notes to financial statements.                                              |   |

----

| GATEWAY                TAX CREDIT FUND                III LTD.                                              |   |
|-------------------------------------------------------------------------------------------------------------|--------|
| (A                Florida Limited Partnership)                                                              |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| BALANCE                SHEETS                                                                               |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                        |   | SERIES                10 |   |   | SERIES                11 |   |   | TOTAL                SERIES 7 - 11 |   |
|                                                                                                        |   | December                31, |   |   | March                31, |   |   | December                31, |   |   | March                31, |   |   | December                31, |   |   | March                31, |   |
|                                                                                                        |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |
| ASSETS                                                                                                      |   | (Unaudited) |   |   | (Audited) |   |   | (Unaudited) |   |   | (Audited) |   |   | (Unaudited) |   |   | (Audited) |   |
| Current                Assets:                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Cash                and Cash Equivalents                                                  |   | $ | 54,375 |   |   | $ | 40,351 |   |   | $ | 47,779 |   |   | $ | 53,170 |   |   | $ | 309,422 |   |   | $ | 477,713 |   |
|    Investments                in Securities                                                  |   |   | 84,164 |   |   |   | 133,864 |   |   |   | 164,798 |   |   |   | 190,291 |   |   |   | 835,700 |   |   |   | 983,742 |   |
|                 Receivable - Other                                                                |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 24,220 |   |
|      Total                Current Assets                                           |   |   | 138,539 |   |   |   | 174,215 |   |   |   | 212,577 |   |   |   | 243,461 |   |   |   | 1,145,122 |   |   |   | 1,485,675 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Investments                in Securities                                                  |   |   | 68,506 |   |   |   | 64,917 |   |   |   | 76,162 |   |   |   | 71,973 |   |   |   | 188,414 |   |   |   | 178,599 |   |
|    Investments                in Project Partnerships, net                                   |   |   | 1,090,974 |   |   |   | 1,159,544 |   |   |   | 1,416,898 |   |   |   | 1,505,978 |   |   |   | 3,625,412 |   |   |   | 3,898,329 |   |
|          Total                Assets                           |   | $ | 1,298,019 |   |   | $ | 1,398,676 |   |   | $ | 1,705,637 |   |   | $ | 1,821,412 |   |   | $ | 4,958,948 |   |   | $ | 5,562,603 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES                AND PARTNERS' EQUITY                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current                Liabilities:                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Payable                to General Partners                                                |   | $ | 29,869 |   |   | $ | 31,747 |   |   | $ | 53,559 |   |   | $ | 34,115 |   |   | $ | 215,017 |   |   | $ | 207,179 |   |
|      Total                Current Liabilities                                      |   |   | 29,869 |   |   |   | 31,747 |   |   |   | 53,559 |   |   |   | 34,115 |   |   |   | 215,017 |   |   |   | 207,179 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-Term                Liabilities:                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Payable                to General Partners                                                |   |   | 103,919 |   |   |   | 78,767 |   |   |   | - |   |   |   | - |   |   |   | 2,253,600 |   |   |   | 2,060,686 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Partners'                Equity (Deficit):                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Limited                Partners - 5,043 and 5,127 units                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      for                Series 10 and 11, respectively, at                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      December                31, 2007 and March 31, 2007                           |   |   | 1,196,767 |   |   |   | 1,319,459 |   |   |   | 1,681,547 |   |   |   | 1,815,414 |   |   |   | 2,789,334 |   |   |   | 3,585,698 |   |
|    General                Partners                                                           |   |   | (32,536 | ) |   |   | (31,297 | ) |   |   | (29,469 | ) |   |   | (28,117 | ) |   |   | (299,003 | ) |   |   | (290,960 | ) |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Total                Partners' Equity                                         |   |   | 1,164,231 |   |   |   | 1,288,162 |   |   |   | 1,652,078 |   |   |   | 1,787,297 |   |   |   | 2,490,331 |   |   |   | 3,294,738 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|          Total                Liabilities and Partners' Equity |   | $ | 1,298,019 |   |   | $ | 1,398,676 |   |   | $ | 1,705,637 |   |   | $ | 1,821,412 |   |   | $ | 4,958,948 |   |   | $ | 5,562,603 |   |
|                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 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, 2007 AND                2006 |   |
| (Unaudited)                                                                         |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   | SERIES                7 |   |   | SERIES                8 |   |   | SERIES                9 |   |
|                                                                                |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| Revenues:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Distribution                Income                                      |   | $ | - |   |   | $ | 1,560 |   |   | $ | 2,617 |   |   | $ | - |   |   | $ | 600 |   |   | $ | - |   |
|     Total                Revenues                               |   |   | - |   |   |   | 1,560 |   |   |   | 2,617 |   |   |   | - |   |   |   | 600 |   |   |   | - |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Expenses:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Asset                Management Fee - General Partner                   |   |   | 21,399 |   |   |   | 21,509 |   |   |   | 22,255 |   |   |   | 22,372 |   |   |   | 12,267 |   |   |   | 12,325 |   |
|   General                and Administrative:                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     General                Partner                              |   |   | 29,677 |   |   |   | 27,437 |   |   |   | 32,721 |   |   |   | 30,250 |   |   |   | 18,263 |   |   |   | 16,884 |   |
|     Other                                                       |   |   | 7,433 |   |   |   | 7,914 |   |   |   | 7,135 |   |   |   | 7,855 |   |   |   | 4,745 |   |   |   | 4,956 |   |
|   Amortization                                                            |   |   | 6,535 |   |   |   | 7,651 |   |   |   | 3,205 |   |   |   | 3,206 |   |   |   | 3,013 |   |   |   | 3,013 |   |
|     Total                Expenses                               |   |   | 65,044 |   |   |   | 64,511 |   |   |   | 65,316 |   |   |   | 63,683 |   |   |   | 38,288 |   |   |   | 37,178 |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss                Before Equity in Losses of Project                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Partnerships                and Other Income                            |   |   | (65,044 | ) |   |   | (62,951 | ) |   |   | (62,699 | ) |   |   | (63,683 | ) |   |   | (37,688 | ) |   |   | (37,178 | ) |
| Equity                in Losses of Project Partnerships                             |   |   | (7,402 | ) |   |   | (3,298 | ) |   |   | (21,888 | ) |   |   | (15,353 | ) |   |   | (17,527 | ) |   |   | (1,859 | ) |
| Interest                Income                                                      |   |   | 5,243 |   |   |   | 6,996 |   |   |   | 3,463 |   |   |   | 5,404 |   |   |   | 3,104 |   |   |   | 4,166 |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                             |   | $ | (67,203 | ) |   | $ | (59,253 | ) |   | $ | (81,124 | ) |   | $ | (73,632 | ) |   | $ | (52,111 | ) |   | $ | (34,871 | ) |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allocation                of Net Loss:                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Limited                Partners                                         |   | $ | (66,531 | ) |   | $ | (58,661 | ) |   | $ | (80,313 | ) |   | $ | (72,896 | ) |   | $ | (51,590 | ) |   | $ | (34,523 | ) |
|   General                Partners                                         |   |   | (672 | ) |   |   | (592 | ) |   |   | (811 | ) |   |   | (736 | ) |   |   | (521 | ) |   |   | (349 | ) |
|                                                                                |   | $ | (67,203 | ) |   | $ | (59,253 | ) |   | $ | (81,124 | ) |   | $ | (73,632 | ) |   | $ | (52,111 | ) |   | $ | (34,872 | ) |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss Per Limited Partnership Unit                                |   | $ | (6.40 | ) |   | $ | (5.64 | ) |   | $ | (8.05 | ) |   | $ | (7.30 | ) |   | $ | (8.25 | ) |   | $ | (5.52 | ) |
| Number                of Limited Partnership Units                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Outstanding                                                             |   |   | 10,395 |   |   |   | 10,395 |   |   |   | 9,980 |   |   |   | 9,980 |   |   |   | 6,254 |   |   |   | 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, 2007 AND                2006 |   |
| (Unaudited)                                                                         |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   | SERIES                10 |   |   | SERIES                11 |   |   | TOTAL                SERIES 7 - 11 |   |
|                                                                                |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| Revenues:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Distribution                Income                                      |   | $ | 749 |   |   | $ | - |   |   | $ | - |   |   | $ | 600 |   |   | $ | 3,966 |   |   | $ | 2,160 |   |
|     Total                Revenues                               |   |   | 749 |   |   |   | - |   |   |   | - |   |   |   | 600 |   |   |   | 3,966 |   |   |   | 2,160 |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Expenses:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Asset                Management Fee - General Partner                   |   |   | 8,384 |   |   |   | 8,419 |   |   |   | 7,253 |   |   |   | 6,938 |   |   |   | 71,558 |   |   |   | 71,563 |   |
|   General                and Administrative:                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     General                Partner                              |   |   | 11,414 |   |   |   | 10,552 |   |   |   | 9,132 |   |   |   | 8,442 |   |   |   | 101,207 |   |   |   | 93,565 |   |
|     Other                                                       |   |   | 3,783 |   |   |   | 3,716 |   |   |   | 3,510 |   |   |   | 4,707 |   |   |   | 26,606 |   |   |   | 29,148 |   |
|   Amortization                                                            |   |   | 6,027 |   |   |   | 6,027 |   |   |   | 8,374 |   |   |   | 8,374 |   |   |   | 27,154 |   |   |   | 28,271 |   |
|     Total                Expenses                               |   |   | 29,608 |   |   |   | 28,714 |   |   |   | 28,269 |   |   |   | 28,461 |   |   |   | 226,525 |   |   |   | 222,547 |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss                Before Equity in (Losses) Income of                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Project                Partnerships and Other Income                    |   |   | (28,859 | ) |   |   | (28,714 | ) |   |   | (28,269 | ) |   |   | (27,861 | ) |   |   | (222,559 | ) |   |   | (220,387 | ) |
| Equity                in (Losses) Income of Project                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Partnerships                                                            |   |   | (20,129 | ) |   |   | (7,649 | ) |   |   | (597 | ) |   |   | 4,418 |   |   |   | (67,543 | ) |   |   | (23,741 | ) |
| Interest                Income                                                      |   |   | 3,071 |   |   |   | 3,783 |   |   |   | 4,271 |   |   |   | 4,920 |   |   |   | 19,152 |   |   |   | 25,269 |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                             |   | $ | (45,917 | ) |   | $ | (32,580 | ) |   | $ | (24,595 | ) |   | $ | (18,523 | ) |   | $ | (270,950 | ) |   | $ | (218,859 | ) |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allocation                of Net Loss:                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Limited                Partners                                         |   | $ | (45,458 | ) |   | $ | (32,253 | ) |   | $ | (24,349 | ) |   | $ | (18,338 | ) |   | $ | (268,241 | ) |   | $ | (216,671 | ) |
|   General                Partners                                         |   |   | (459 | ) |   |   | (327 | ) |   |   | (246 | ) |   |   | (185 | ) |   |   | (2,709 | ) |   |   | (2,188 | ) |
|                                                                                |   | $ | (45,917 | ) |   | $ | (32,580 | ) |   | $ | (24,595 | ) |   | $ | (18,523 | ) |   | $ | (270,950 | ) |   | $ | (218,859 | ) |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss Per Limited Partnership Unit                                |   | $ | (9.01 | ) |   | $ | (6.40 | ) |   | $ | (4.75 | ) |   | $ | (3.58 | ) |   |   |   |   |   |   |   |   |
| Number                of Limited Partnership Units                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Outstanding                                                             |   |   | 5,043 |   |   |   | 5,043 |   |   |   | 5,127 |   |   |   | 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, 2007 AND                2006 |   |
| (Unaudited)                                                                        |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   | SERIES                7 |   |   | SERIES                8 |   |   | SERIES                9 |   |
|                                                                               |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| Revenues:                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Distribution                Income                                     |   | $ | 19,434 |   |   | $ | 17,506 |   |   | $ | 18,224 |   |   | $ | 8,329 |   |   | $ | 4,603 |   |   | $ | 4,809 |   |
|     Total                Revenues                              |   |   | 19,434 |   |   |   | 17,506 |   |   |   | 18,224 |   |   |   | 8,329 |   |   |   | 4,603 |   |   |   | 4,809 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Expenses:                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Asset                Management Fee - General Partner                  |   |   | 64,197 |   |   |   | 64,527 |   |   |   | 66,765 |   |   |   | 67,115 |   |   |   | 36,801 |   |   |   | 36,975 |   |
|   General                and Administrative:                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     General                Partner                             |   |   | 88,799 |   |   |   | 82,777 |   |   |   | 97,906 |   |   |   | 91,266 |   |   |   | 54,645 |   |   |   | 50,940 |   |
|     Other                                                      |   |   | 30,435 |   |   |   | 32,575 |   |   |   | 30,624 |   |   |   | 32,925 |   |   |   | 20,592 |   |   |   | 19,685 |   |
|   Amortization                                                           |   |   | 19,605 |   |   |   | 24,023 |   |   |   | 9,616 |   |   |   | 9,618 |   |   |   | 9,039 |   |   |   | 9,039 |   |
|     Total                Expenses                              |   |   | 203,036 |   |   |   | 203,902 |   |   |   | 204,911 |   |   |   | 200,924 |   |   |   | 121,077 |   |   |   | 116,639 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss                Before Equity in Losses of Project                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Partnerships                and Other Income                           |   |   | (183,602 | ) |   |   | (186,396 | ) |   |   | (186,687 | ) |   |   | (192,595 | ) |   |   | (116,474 | ) |   |   | (111,830 | ) |
| Equity                in Losses of Project Partnerships                            |   |   | (13,179 | ) |   |   | (25,148 | ) |   |   | (28,553 | ) |   |   | (14,198 | ) |   |   | (56,388 | ) |   |   | (46,222 | ) |
| Interest                Income                                                     |   |   | 17,367 |   |   |   | 21,309 |   |   |   | 12,014 |   |   |   | 17,057 |   |   |   | 10,245 |   |   |   | 12,815 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                            |   | $ | (179,414 | ) |   | $ | (190,235 | ) |   | $ | (203,226 | ) |   | $ | (189,736 | ) |   | $ | (162,617 | ) |   | $ | (145,237 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allocation                of Net Loss:                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Limited                Partners                                        |   | $ | (177,620 | ) |   | $ | (188,333 | ) |   | $ | (201,194 | ) |   | $ | (187,839 | ) |   | $ | (160,991 | ) |   | $ | (143,785 | ) |
|   General                Partners                                        |   |   | (1,794 | ) |   |   | (1,902 | ) |   |   | (2,032 | ) |   |   | (1,897 | ) |   |   | (1,626 | ) |   |   | (1,452 | ) |
|                                                                               |   | $ | (179,414 | ) |   | $ | (190,235 | ) |   | $ | (203,226 | ) |   | $ | (189,736 | ) |   | $ | (162,617 | ) |   | $ | (145,237 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss Per Limited Partnership Unit                               |   | $ | (17.09 | ) |   | $ | (18.12 | ) |   | $ | (20.16 | ) |   | $ | (18.82 | ) |   | $ | (25.74 | ) |   | $ | (22.99 | ) |
| Number                of Limited Partnership Units                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Outstanding                                                            |   |   | 10,395 |   |   |   | 10,395 |   |   |   | 9,980 |   |   |   | 9,980 |   |   |   | 6,254 |   |   |   | 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, 2007 AND                2006 |   |
| (Unaudited)                                                                        |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   | SERIES                10 |   |   | SERIES                11 |   |   | TOTAL                SERIES 7 - 11 |   |
|                                                                               |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| Revenues:                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Distribution                Income                                     |   | $ | 2,129 |   |   | $ | 1,381 |   |   | $ | 2,182 |   |   | $ | 2,782 |   |   | $ | 46,572 |   |   | $ | 34,807 |   |
|     Total                Revenues                              |   |   | 2,129 |   |   |   | 1,381 |   |   |   | 2,182 |   |   |   | 2,782 |   |   |   | 46,572 |   |   |   | 34,807 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Expenses:                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Asset                Management Fee - General Partner                  |   |   | 25,152 |   |   |   | 25,259 |   |   |   | 21,445 |   |   |   | 20,814 |   |   |   | 214,360 |   |   |   | 214,690 |   |
|   General                and Administrative:                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     General                Partner                             |   |   | 34,153 |   |   |   | 31,837 |   |   |   | 27,323 |   |   |   | 25,470 |   |   |   | 302,826 |   |   |   | 282,290 |   |
|     Other                                                      |   |   | 14,643 |   |   |   | 15,739 |   |   |   | 14,634 |   |   |   | 16,375 |   |   |   | 110,928 |   |   |   | 117,299 |   |
|   Amortization                                                           |   |   | 18,080 |   |   |   | 18,081 |   |   |   | 25,122 |   |   |   | 25,122 |   |   |   | 81,462 |   |   |   | 85,883 |   |
|     Total                Expenses                              |   |   | 92,028 |   |   |   | 90,916 |   |   |   | 88,524 |   |   |   | 87,781 |   |   |   | 709,576 |   |   |   | 700,162 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss                Before Equity in (Losses) Income of                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Project                Partnerships and Other Income                   |   |   | (89,899 | ) |   |   | (89,535 | ) |   |   | (86,342 | ) |   |   | (84,999 | ) |   |   | (663,004 | ) |   |   | (665,355 | ) |
| Equity                in (Losses) Income of Project                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Partnerships                                                           |   |   | (43,828 | ) |   |   | (55,553 | ) |   |   | (62,171 | ) |   |   | 4,645 |   |   |   | (204,119 | ) |   |   | (136,476 | ) |
| Interest                Income                                                     |   |   | 9,796 |   |   |   | 11,421 |   |   |   | 13,294 |   |   |   | 14,637 |   |   |   | 62,716 |   |   |   | 77,239 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                            |   | $ | (123,931 | ) |   | $ | (133,667 | ) |   | $ | (135,219 | ) |   | $ | (65,717 | ) |   | $ | (804,407 | ) |   | $ | (724,592 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allocation                of Net Loss:                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Limited                Partners                                        |   | $ | (122,692 | ) |   | $ | (132,330 | ) |   | $ | (133,867 | ) |   | $ | (65,060 | ) |   | $ | (796,364 | ) |   | $ | (717,347 | ) |
|   General                Partners                                        |   |   | (1,239 | ) |   |   | (1,337 | ) |   |   | (1,352 | ) |   |   | (657 | ) |   |   | (8,043 | ) |   |   | (7,245 | ) |
|                                                                               |   | $ | (123,931 | ) |   | $ | (133,667 | ) |   | $ | (135,219 | ) |   | $ | (65,717 | ) |   | $ | (804,407 | ) |   | $ | (724,592 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss Per Limited Partnership Unit                               |   | $ | (24.33 | ) |   | $ | (26.24 | ) |   | $ | (26.11 | ) |   | $ | (12.69 | ) |   |   |   |   |   |   |   |   |
| Number                of Limited Partnership Units                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Outstanding                                                            |   |   | 5,043 |   |   |   | 5,043 |   |   |   | 5,127 |   |   |   | 5,127 |   |   |   |   |   |   |   |   |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 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, 2007 AND                2006 |   |
| (Unaudited)                                                                        |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   | SERIES                7 |   |   | SERIES                8 |   |
|                                                                               |   | Limited |   |   | General |   |   |   |   |   | Limited |   |   | General |   |   |   |   |
|                                                                               |   | Partners |   |   | Partners |   |   | Total |   |   | Partners |   |   | Partners |   |   | Total |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at March 31, 2006                                           |   | $ | 568,818 |   |   | $ | (86,455 | ) |   | $ | 482,363 |   |   | $ | 243,770 |   |   | $ | (86,048 | ) |   | $ | 157,722 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                            |   |   | (188,333 | ) |   |   | (1,902 | ) |   |   | (190,235 | ) |   |   | (187,839 | ) |   |   | (1,897 | ) |   |   | (189,736 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at December 31, 2006                                        |   | $ | 380,485 |   |   | $ | (88,357 | ) |   | $ | 292,128 |   |   | $ | 55,931 |   |   | $ | (87,945 | ) |   | $ | (32,014 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at March 31, 2007                                           |   | $ | 205,836 |   |   | $ | (90,121 | ) |   | $ | 115,715 |   |   | $ | 5,547 |   |   | $ | (88,454 | ) |   | $ | (82,907 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                            |   |   | (177,620 | ) |   |   | (1,794 | ) |   |   | (179,414 | ) |   |   | (201,194 | ) |   |   | (2,032 | ) |   |   | (203,226 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at December 31, 2007                                        |   | $ | 28,216 |   |   | $ | (91,915 | ) |   | $ | (63,699 | ) |   | $ | (195,647 | ) |   | $ | (90,486 | ) |   | $ | (286,133 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 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, 2007 AND                2006                                                                                                                                                                                                                   |   |
| (Unaudited)                                                                                                                                                                                                                                                                                          |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                 |   | SERIES                9 |   |   | SERIES                10 |   |
|                                                                                                                                                                                                                                                                                                 |   | Limited |   |   | General |   |   |   |   |   | Limited |   |   | General |   |   |   |   |
|                                                                                                                                                                                                                                                                                                 |   | Partners |   |   | Partners |   |   | Total |   |   | Partners |   |   | Partners |   |   | Total |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at March 31, 2006                                                                                                                                                                                                                                                             |   | $ | 485,089 |   |   | $ | (50,490 | ) |   | $ | 434,599 |   |   | $ | 1,578,554 |   |   | $ | (28,680 | ) |   | $ | 1,549,874 |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                                                                                                                                                                                                                                              |   |   | (143,785 | ) |   |   | (1,452 | ) |   |   | (145,237 | ) |   |   | (132,330 | ) |   |   | (1,337 | ) |   |   | (133,667 | ) |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at December 31, 2006                                                                                                                                                                                                                                                          |   | $ | 341,304 |   |   | $ | (51,942 | ) |   | $ | 289,362 |   |   | $ | 1,446,224 |   |   | $ | (30,017 | ) |   | $ | 1,416,207 |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at March 31, 2007                                                                                                                                                                                                                                                             |   | $ | 239,442 |   |   | $ | (52,971 | ) |   | $ | 186,471 |   |   | $ | 1,319,459 |   |   | $ | (31,297 | ) |   | $ | 1,288,162 |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                                                                                                                                                                                                                                              |   |   | (160,991 | ) |   |   | (1,626 | ) |   |   | (162,617 | ) |   |   | (122,692 | ) |   |   | (1,239 | ) |   |   | (123,931 | ) |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at December 31, 2007                                                                                                                                                                                                                                                          |   | $ | 78,451 |   |   | $ | (54,597 | ) |   | $ | 23,854 |   |   | $ | 1,196,767 |   |   | $ | (32,536 | ) |   | $ | 1,164,231 |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 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, 2007 AND                2006 |   |
| (Unaudited)                                                                        |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   | SERIES                11 |   |   | TOTAL                SERIES 7 - 11 |   |
|                                                                               |   | Limited |   |   | General |   |   |   |   |   | Limited |   |   | General |   |   |   |   |
|                                                                               |   | Partners |   |   | Partners |   |   | Total |   |   | Partners |   |   | Partners |   |   | Total |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at March 31, 2006                                           |   | $ | 2,281,421 |   |   | $ | (23,410 | ) |   | $ | 2,258,011 |   |   | $ | 5,157,652 |   |   | $ | (275,083 | ) |   | $ | 4,882,569 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                            |   |   | (65,060 | ) |   |   | (657 | ) |   |   | (65,717 | ) |   |   | (717,347 | ) |   |   | (7,245 | ) |   |   | (724,592 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at December 31, 2006                                        |   | $ | 2,216,361 |   |   | $ | (24,067 | ) |   | $ | 2,192,294 |   |   | $ | 4,440,305 |   |   | $ | (282,328 | ) |   | $ | 4,157,977 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at March 31, 2007                                           |   | $ | 1,815,414 |   |   | $ | (28,117 | ) |   | $ | 1,787,297 |   |   | $ | 3,585,698 |   |   | $ | (290,960 | ) |   | $ | 3,294,738 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                Loss                                                            |   |   | (133,867 | ) |   |   | (1,352 | ) |   |   | (135,219 | ) |   |   | (796,364 | ) |   |   | (8,043 | ) |   |   | (804,407 | ) |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at December 31, 2007                                        |   | $ | 1,681,547 |   |   | $ | (29,469 | ) |   | $ | 1,652,078 |   |   | $ | 2,789,334 |   |   | $ | (299,003 | ) |   | $ | 2,490,331 |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 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, 2007 AND                2006                                             |   |
| (Unaudited)                                                                                                                    |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   | SERIES                7 |   |   | SERIES                8 |   |
|                                                                                                                           |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| Cash                Flows from Operating Activities:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|   Net                Loss                                                                                            |   | $ | (179,414 | ) |   | $ | (190,235 | ) |   | $ | (203,226 | ) |   | $ | (189,736 | ) |
|   Adjustments                to Reconcile Net Loss to Net Cash                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Used                in Operating Activities:                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       Amortization                                                                               |   |   | 19,605 |   |   |   | 24,023 |   |   |   | 9,616 |   |   |   | 9,618 |   |
|       Accreted                Interest Income on Investments in Securities                       |   |   | (4,635 | ) |   |   | (13,472 | ) |   |   | (4,179 | ) |   |   | (10,814 | ) |
|       Accreted                Discount on Investments in Securities                              |   |   | (697 | ) |   |   | - |   |   |   | (467 | ) |   |   | - |   |
|       Equity                in Losses of Project Partnerships                                    |   |   | 13,179 |   |   |   | 25,148 |   |   |   | 28,553 |   |   |   | 14,198 |   |
|       Distribution                Income                                                         |   |   | (19,434 | ) |   |   | (17,506 | ) |   |   | (18,224 | ) |   |   | (8,329 | ) |
|       Changes                in Operating Assets and Liabilities:                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         Decrease                in Interest Receivable                                 |   |   | 1,553 |   |   |   | - |   |   |   | 1,143 |   |   |   | - |   |
|         Increase                in Payable to General Partners                         |   |   | 60,617 |   |   |   | 62,298 |   |   |   | 63,222 |   |   |   | 64,591 |   |
|           Net                Cash Used In Operating Activities               |   |   | (109,226 | ) |   |   | (109,744 | ) |   |   | (123,562 | ) |   |   | (120,472 | ) |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                Flows from Investing Activities:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Distributions                Received from Project Partnerships                                                    |   |   | 19,552 |   |   |   | 24,643 |   |   |   | 19,489 |   |   |   | 12,553 |   |
|   Redemption                of Investment Securities                                                                 |   |   | 203,000 |   |   |   | - |   |   |   | 127,000 |   |   |   | - |   |
|   Purchase                of Investment Securities                                                                   |   |   | (200,266 | ) |   |   | (200,084 | ) |   |   | (75,100 | ) |   |   | (125,177 | ) |
|           Net                Cash Provided by (Used in) Investing Activities |   |   | 22,286 |   |   |   | (175,441 | ) |   |   | 71,389 |   |   |   | (112,624 | ) |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Decrease                in Cash and Cash Equivalents                                                                           |   |   | (86,940 | ) |   |   | (285,185 | ) |   |   | (52,173 | ) |   |   | (233,096 | ) |
| Cash                and Cash Equivalents at Beginning of Year                                                                  |   |   | 179,018 |   |   |   | 394,030 |   |   |   | 135,130 |   |   |   | 309,318 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                and Cash Equivalents at End of Period                                                                      |   | $ | 92,078 |   |   | $ | 108,845 |   |   | $ | 82,957 |   |   | $ | 76,222 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 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, 2007 AND                2006                                             |   |
| (Unaudited)                                                                                                                    |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   | SERIES                9 |   |   | SERIES                10 |   |
|                                                                                                                           |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| Cash                Flows from Operating Activities:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|   Net                Loss                                                                                            |   | $ | (162,617 | ) |   | $ | (145,237 | ) |   | $ | (123,931 | ) |   | $ | (133,667 | ) |
|   Adjustments                to Reconcile Net Loss to Net Cash                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Used                in Operating Activities:                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       Amortization                                                                               |   |   | 9,039 |   |   |   | 9,039 |   |   |   | 18,080 |   |   |   | 18,081 |   |
|       Accreted                Interest Income on Investments in Securities                       |   |   | (4,096 | ) |   |   | (8,817 | ) |   |   | (5,355 | ) |   |   | (9,044 | ) |
|       Accreted                Discount on Investments in Securities                              |   |   | (451 | ) |   |   | - |   |   |   | (379 | ) |   |   | - |   |
|       Equity                in Losses of Project Partnerships                                    |   |   | 56,388 |   |   |   | 46,222 |   |   |   | 43,828 |   |   |   | 55,553 |   |
|       Distribution                Income                                                         |   |   | (4,603 | ) |   |   | (4,809 | ) |   |   | (2,129 | ) |   |   | (1,381 | ) |
|       Changes                in Operating Assets and Liabilities:                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         Decrease                in Interest Receivable                                 |   |   | 1,140 |   |   |   | - |   |   |   | 911 |   |   |   | - |   |
|         Increase                in Payable to General Partners                         |   |   | 34,195 |   |   |   | 34,610 |   |   |   | 23,274 |   |   |   | 23,794 |   |
|           Net                Cash Used In Operating Activities               |   |   | (71,005 | ) |   |   | (68,992 | ) |   |   | (45,701 | ) |   |   | (46,664 | ) |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                Flows from Investing Activities:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Distributions                Received from Project Partnerships                                                    |   |   | 6,327 |   |   |   | 9,714 |   |   |   | 8,791 |   |   |   | 12,889 |   |
|   Redemption                of Investment Securities                                                                 |   |   | 127,000 |   |   |   | - |   |   |   | 101,000 |   |   |   | - |   |
|   Purchase                of Investment Securities                                                                   |   |   | (100,133 | ) |   |   | (125,177 | ) |   |   | (50,066 | ) |   |   | (99,551 | ) |
|           Net                Cash Provided by (Used in) Investing Activities |   |   | 33,194 |   |   |   | (115,463 | ) |   |   | 59,725 |   |   |   | (86,662 | ) |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (Decrease)                Increase in Cash and Cash Equivalents                                                                |   |   | (37,811 | ) |   |   | (184,455 | ) |   |   | 14,024 |   |   |   | (133,326 | ) |
| Cash                and Cash Equivalents at Beginning of Year                                                                  |   |   | 70,044 |   |   |   | 222,993 |   |   |   | 40,351 |   |   |   | 144,697 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                and Cash Equivalents at End of Period                                                                      |   | $ | 32,233 |   |   | $ | 38,538 |   |   | $ | 54,375 |   |   | $ | 11,371 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 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, 2007 AND                2006                                             |   |
| (Unaudited)                                                                                                                    |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   | SERIES                11 |   |   | TOTAL                SERIES 7 - 11 |   |
|                                                                                                                           |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| Cash                Flows from Operating Activities:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|   Net                Loss                                                                                            |   | $ | (135,219 | ) |   | $ | (65,717 | ) |   | $ | (804,407 | ) |   | $ | (724,592 | ) |
|   Adjustments                to Reconcile Net Loss to Net Cash                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Used                in Operating Activities:                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       Amortization                                                                               |   |   | 25,122 |   |   |   | 25,122 |   |   |   | 81,462 |   |   |   | 85,883 |   |
|       Accreted                Interest Income on Investments in Securities                       |   |   | (6,356 | ) |   |   | (11,564 | ) |   |   | (24,621 | ) |   |   | (53,711 | ) |
|       Accreted                Discount on Investments in Securities                              |   |   | (537 | ) |   |   | - |   |   |   | (2,531 | ) |   |   | - |   |
|       Equity                in Losses (Income) of Project Partnerships                           |   |   | 62,171 |   |   |   | (4,645 | ) |   |   | 204,119 |   |   |   | 136,476 |   |
|       Distribution                Income                                                         |   |   | (2,182 | ) |   |   | (2,782 | ) |   |   | (46,572 | ) |   |   | (34,807 | ) |
|       Changes                in Operating Assets and Liabilities:                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         Decrease                in Interest Receivable                                 |   |   | 1,363 |   |   |   | - |   |   |   | 6,110 |   |   |   | - |   |
|         Increase                in Payable to General Partners                         |   |   | 19,444 |   |   |   | 12,252 |   |   |   | 200,752 |   |   |   | 197,545 |   |
|           Net                Cash Used In Operating Activities               |   |   | (36,194 | ) |   |   | (47,334 | ) |   |   | (385,688 | ) |   |   | (393,206 | ) |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                Flows from Investing Activities:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Distributions                Received from Project Partnerships                                                    |   |   | 3,969 |   |   |   | 7,054 |   |   |   | 58,128 |   |   |   | 66,853 |   |
|   Redemption                of Investment Securities                                                                 |   |   | 152,000 |   |   |   | - |   |   |   | 710,000 |   |   |   | - |   |
|   Purchase                of Investment Securities                                                                   |   |   | (125,166 | ) |   |   | (149,818 | ) |   |   | (550,731 | ) |   |   | (699,807 | ) |
|           Net                Cash Provided by (Used in) Investing Activities |   |   | 30,803 |   |   |   | (142,764 | ) |   |   | 217,397 |   |   |   | (632,954 | ) |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Decrease                in Cash and Cash Equivalents                                                                           |   |   | (5,391 | ) |   |   | (190,098 | ) |   |   | (168,291 | ) |   |   | (1,026,160 | ) |
| Cash                and Cash Equivalents at Beginning of Year                                                                  |   |   | 53,170 |   |   |   | 207,490 |   |   |   | 477,713 |   |   |   | 1,278,528 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                and Cash Equivalents at End of Period                                                                      |   | $ | 47,779 |   |   | $ | 17,392 |   |   | $ | 309,422 |   |   | $ | 252,368 |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| See                accompanying notes to financial statements.                                                                 |   |

----

| 1)   | Gateway's                capital contribution, |
|----------------|------------------------------------------------|

| 2)   | Acquisition                fees paid to the General Partner for services rendered in selecting                properties for acquisition, and |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Acquisition                expenses including legal fees, travel and other miscellaneous costs                relating to acquiring properties. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------|

| 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,                      |
|----------------|--------------------------------------------------------------------------------------------------------------|
|  3)  | Decreased              for the amortization of the acquisition fees and expenses,              and           |
| 4)        | Increased              for loans or advances made to the Project Partnerships by              Gateway.  |

----

----

|                     | Estimated                MarketValue | Cost                Plus Accreted Interest and Unamortized                Premiums | Gross                UnrealizedGains |
|--------------------------|--------------------------------------|------------------------------------------------------------------------------------|--------------------------------------|
| Series                7  | $                287,337             | $                285,564                                                           | $                1,773          |
| Series                8  | 157,317                              | 156,438                                                                            | 879                             |
| Series                9  | 191,121                              | 188,482                                                                            | 2,639                           |
| Series                10 | 156,635                              | 152,670                                                                            | 3,965                           |
| Series                11 | 247,790                              | 240,960                                                                            | 6,830                           |

|                                                                  |
|------------------------------------------------------------------|
|                                                             | Series                7 | Series                8 | Series                9 |
| Due              within 1              year                      | $                285,564 | $                156,438 | $                144,736 |
| After                1 year through 5 years                      |              0 |              0 |     43,746 |
|   Total                Amount Carried on Balance Sheet | $                285,564 | $                156,438 | $                188,482 |

|                                                               | Series                  10     | Series                  11     | Total                           |
|--------------------------------------------------------------------|--------------------------------|--------------------------------|---------------------------------|
| Due                  within 1 year                                 | $   84,164      | $                  164,798     | $   835,700      |
| After                  1 year through 5 years                      |     68,506 |     76,162 |     188,414 |
|   Total                  Amount Carried on Balance Sheet | $                  152,670     | $                  240,960     | $1,024,114                      |

|                     | 2007                                 | 2006                                 |
|--------------------------|--------------------------------------|--------------------------------------|
| Series                7  | $   64,197            | $   64,527            |
| Series                8  | 66,765                               | 67,115                               |
| Series                9  | 36,801                               | 36,975                               |
| Series                10 | 25,152                               | 25,529                               |
| Series                11 |      21,445 |      20,814 |
| Total                    | $                214,360             | $                214,690             |

|                     |                                 |                                 |
|--------------------------|--------------------------------------|--------------------------------------|
|                     | 2007                                 | 2006                                 |
| Series                7  | $   88,799            | $   82,777            |
| Series                8  | 97,906                               | 91,266                               |
| Series                9  | 54,645                               | 50,940                               |
| Series                10 | 34,153                               | 31,837                               |
| Series                11 |      27,323 |      25,470 |
| Total                    | $                302,826             | $                282,290             |

----

|  NOTE                5 - INVESTMENTS IN                PROJECT PARTNERSHIPS:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As                of December 31, 2007, Gateway had acquired a 99% interest in the                profits,                losses, and Tax Credits as a limited partner in Project Partnerships                (Series 7 - 39, Series 8 - 43, and Series 9 - 24) which own and operate                government assisted multi-family housing complexes. Cash flows from                operations are allocated according to each Project Partnership                agreement. Upon dissolution, proceeds will be distributed according                to each Project Partnership agreement. |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| The                following is a summary of Investments in Project Partnerships as                of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | SERIES                7 |   |   | SERIES                8 |   |   | SERIES                9 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | December                31, |   |   | March                31, |   |   | December                31, |   |   | March                31, |   |   | December                31, |   |   | March                31, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |
| Capital                Contributions to Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| and                purchase price paid for limited partner                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| interests                in Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $ | 7,732,089 |   |   | $ | 7,732,089 |   |   | $ | 7,586,105 |   |   | $ | 7,586,105 |   |   | $ | 4,914,116 |   |   | $ | 4,914,116 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loan                receivable from Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | - |   |   |   | - |   |   |   | 24,220 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cumulative                equity in losses of Project                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Partnerships                (1) (2)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | (7,316,197 | ) |   |   | (7,303,018 | ) |   |   | (7,458,919 | ) |   |   | (7,430,366 | ) |   |   | (4,434,379 | ) |   |   | (4,377,991 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cumulative                distributions received from                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Project                Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | (254,435 | ) |   |   | (254,317 | ) |   |   | (184,949 | ) |   |   | (183,684 | ) |   |   | (158,694 | ) |   |   | (156,970 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investment                in Project Partnerships before                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Adjustment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | 161,457 |   |   |   | 174,754 |   |   |   | (33,543 | ) |   |   | (27,945 | ) |   |   | 321,043 |   |   |   | 379,155 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Excess                of investment cost over the underlying                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| assets                acquired:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Acquisition                fees and expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 793,335 |   |   |   | 793,335 |   |   |   | 549,773 |   |   |   | 549,773 |   |   |   | 244,087 |   |   |   | 244,087 |   |
|   Accumulated                amortization of acquisition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   fees                and expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   | (275,516 | ) |   |   | (255,911 | ) |   |   | (153,711 | ) |   |   | (144,095 | ) |   |   | (92,462 | ) |   |   | (83,423 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Reserve                for Impairment of Investment in                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Project                Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   | (269,391 | ) |   |   | (269,391 | ) |   |   | - |   |   |   | - |   |   |   | (127,532 | ) |   |   | (127,532 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investments                in Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | $ | 409,885 |   |   | $ | 442,787 |   |   | $ | 362,519 |   |   | $ | 377,733 |   |   | $ | 345,136 |   |   | $ | 412,287 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1)                In accordance with Gateway's accounting policy to not carry Investments                in                Project Partnerships below zero, cumulative suspended losses of $5,681,201                in Series 7, $6,407,849 in Series 8, and $2,166,828 in Series 9 for                the                period ended December 31, 2007; and cumulative suspended losses of                $5,388,453 in Series 7, $6,190,831 in Series 8, and $2,054,048 in                Series 9                for the year ended March 31, 2007 are not included.                                |   |
|  (2)              In accordance with Gateway's accounting policy to apply equity in losses              of Project Partnerships to receivables from Project Partnerships, $24,220              in losses are included in Series 8 as of December 31, 2007.  (See              discussion of EITF 98-13 in Note 2 - Significant Accounting              Policies.)                                                                                                                                                                                                                          |   |

----

| NOTE                5 - INVESTMENTS IN PROJECT PARTNERSHIPS                (continued):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As                of December 31, 2007, Gateway had acquired a 99% interest in the                profits,                losses, and Tax Credits as a limited partner in Project Partnerships                (Series 10 - 15 and Series 11 - 12) which own and operate government                assisted multi-family housing complexes. Cash flows from operations                are allocated according to each Project Partnership agreement. Upon                dissolution, proceeds will be distributed according to each Project                Partnership agreement. |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| The                following is a summary of Investments in Project Partnerships as                of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | SERIES                10 |   |   | SERIES                11 |   |   | TOTAL                SERIES 7 - 11 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | December                31, |   |   | March                31, |   |   | December                31, |   |   | March                31, |   |   | December                31, |   |   | March                31, |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |   | 2007 |   |
| Capital                Contributions to Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| and                purchase price paid for limited partner                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| interests                in Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | $ | 3,914,672 |   |   | $ | 3,914,672 |   |   | $ | 4,128,042 |   |   | $ | 4,128,042 |   |   | $ | 28,275,024 |   |   | $ | 28,275,024 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loan                receivable from Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 24,220 |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cumulative                equity in losses of Project                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Partnerships                (1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   | (2,476,095 | ) |   |   | (2,432,267 | ) |   |   | (1,699,315 | ) |   |   | (1,637,144 | ) |   |   | (23,384,905 | ) |   |   | (23,180,786 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cumulative                distributions received from                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Project                Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   | (216,030 | ) |   |   | (209,368 | ) |   |   | (182,924 | ) |   |   | (181,137 | ) |   |   | (997,032 | ) |   |   | (985,476 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investment                in Project Partnerships before                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Adjustment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 1,222,547 |   |   |   | 1,273,037 |   |   |   | 2,245,803 |   |   |   | 2,309,761 |   |   |   | 3,917,307 |   |   |   | 4,108,762 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Excess                of investment cost over the underlying                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| assets                acquired:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Acquisition                fees and expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 196,738 |   |   |   | 196,738 |   |   |   | 290,335 |   |   |   | 290,335 |   |   |   | 2,074,268 |   |   |   | 2,074,268 |   |
|   Accumulated                amortization of acquisition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   fees                and expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | (125,488 | ) |   |   | (107,408 | ) |   |   | (173,117 | ) |   |   | (147,995 | ) |   |   | (820,294 | ) |   |   | (738,832 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Reserve                for Impairment of Investment in                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Project                Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   | (202,823 | ) |   |   | (202,823 | ) |   |   | (946,123 | ) |   |   | (946,123 | ) |   |   | (1,545,869 | ) |   |   | (1,545,869 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investments                in Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $ | 1,090,974 |   |   | $ | 1,159,544 |   |   | $ | 1,416,898 |   |   | $ | 1,505,978 |   |   | $ | 3,625,412 |   |   | $ | 3,898,329 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1)                In accordance with Gateway's accounting policy to not carry Investments                in                Project Partnerships below zero, cumulative suspended losses of $419,286                in Series 10 and $1,011,412 in Series 11 for the period ended December                31,                2007; and cumulative suspended losses of $421,709 in Series 10 and                $941,227 in Series 11 for the year ended March 31, 2007 are not                included.                                                                                     |   |

----

| NOTE                5 - INVESTMENTS IN PROJECT PARTNERSHIPS                (continued):                                                                                                                                                                                                                                                                                                                                                                            |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |
| In                accordance with Gateway's policy of presenting the financial information                of the Project Partnerships on a three month lag, below is the summarized                balance sheets for the Project Partnerships of Series 7 and Series                8 as of                September 30 and the respective summarized statements of operations                for                the nine months ended September 30 of each year: |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | SERIES                7 |   |   | SERIES                8 (1) |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| SUMMARIZED                BALANCE SHEETS                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|     Current                assets                                                                                                                                                                                                                                                                                                                                                                                                              |   | $ | 4,813,755 |   |   | $ | 4,485,287 |   |   | $ | 4,921,112 |   |   | $ | 4,381,778 |   |
|     Investment                properties, net                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 24,891,149 |   |   |   | 26,164,360 |   |   |   | 26,149,940 |   |   |   | 27,528,755 |   |
|     Other                assets                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | 37,862 |   |   |   | 59,398 |   |   |   | 66,176 |   |   |   | 75,730 |   |
|         Total                assets                                                                                                                                                                                                                                                                                                                                                                                        |   | $ | 29,742,766 |   |   | $ | 30,709,045 |   |   | $ | 31,137,228 |   |   | $ | 31,986,263 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities                and Partners' Deficit:                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Current                liabilities                                                                                                                                                                                                                                                                                                                                                                                                         |   | $ | 469,241 |   |   | $ | 537,138 |   |   | $ | 938,778 |   |   | $ | 907,204 |   |
|     Long-term                debt                                                                                                                                                                                                                                                                                                                                                                                                              |   |   | 35,409,985 |   |   |   | 35,642,424 |   |   |   | 37,297,268 |   |   |   | 37,532,816 |   |
|         Total                liabilities                                                                                                                                                                                                                                                                                                                                                                                   |   |   | 35,879,226 |   |   |   | 36,179,562 |   |   |   | 38,236,046 |   |   |   | 38,440,020 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Partners'                deficit                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Limited                Partner                                                                                                                                                                                                                                                                                                                                                                                                             |   |   | (5,724,185 | ) |   |   | (5,106,661 | ) |   |   | (6,348,310 | ) |   |   | (5,738,760 | ) |
|     General                Partners                                                                                                                                                                                                                                                                                                                                                                                                            |   |   | (412,275 | ) |   |   | (363,856 | ) |   |   | (750,508 | ) |   |   | (714,997 | ) |
|         Total                partners' deficit                                                                                                                                                                                                                                                                                                                                                                             |   |   | (6,136,460 | ) |   |   | (5,470,517 | ) |   |   | (7,098,818 | ) |   |   | (6,453,757 | ) |
|         Total                liabilities and partners' deficit                                                                                                                                                                                                                                                                                                                                                             |   | $ | 29,742,766 |   |   | $ | 30,709,045 |   |   | $ | 31,137,228 |   |   | $ | 31,986,263 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| SUMMARIZED                STATEMENTS OF OPERATIONS                                                                                                                                                                                                                                                                                                                                                                                                                 |   |
| Rental                and other income                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $ | 4,025,469 |   |   | $ | 3,898,737 |   |   | $ | 4,094,808 |   |   | $ | 3,934,633 |   |
| Expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Operating                expenses                                                                                                                                                                                                                                                                                                                                                                                                          |   |   | 2,660,382 |   |   |   | 2,588,646 |   |   |   | 2,596,395 |   |   |   | 2,510,967 |   |
|     Interest                expense                                                                                                                                                                                                                                                                                                                                                                                                            |   |   | 567,685 |   |   |   | 571,617 |   |   |   | 610,654 |   |   |   | 623,092 |   |
|     Depreciation                and amortization                                                                                                                                                                                                                                                                                                                                                                                               |   |   | 1,106,418 |   |   |   | 1,104,690 |   |   |   | 1,136,208 |   |   |   | 1,113,939 |   |
|         Total                expenses                                                                                                                                                                                                                                                                                                                                                                                      |   |   | 4,334,485 |   |   |   | 4,264,953 |   |   |   | 4,343,257 |   |   |   | 4,247,998 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|             Net                loss                                                                                                                                                                                                                                                                                                                                                                    |   | $ | (309,016 | ) |   | $ | (366,216 | ) |   | $ | (248,449 | ) |   | $ | (313,365 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                partners' share of net loss                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $ | (3,089 | ) |   | $ | (3,662 | ) |   | $ | (2,878 | ) |   | $ | (4,972 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gateway's                share of net loss                                                                                                                                                                                                                                                                                                                                                                                                                         |   | $ | (305,927 | ) |   | $ | (362,554 | ) |   | $ | (245,571 | ) |   | $ | (308,393 | ) |
| Suspended                losses                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 292,748 |   |   |   | 337,406 |   |   |   | 217,018 |   |   |   | 294,195 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity                in Losses of Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                            |   | $ | (13,179 | ) |   | $ | (25,148 | ) |   | $ | (28,553 | ) |   | $ | (14,198 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| (1)    As                discussed in Note 4, an affiliate of the General Partner (Value Partners,                Inc.) is the operating general partner in one of the Project Partnerships                included in Series 8 above (Logan Heights).  The Logan Heights                Project Partnership is not consolidated in Gateway's financial statements                as Gateway's investment in Logan Heights is accounted for under the                equity                method.  The information below is included for related party                disclosure purposes.  The Project Partnership's financial                information for the periods ending September 2007 and September 2006                is as                follows: |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |

|                                   | September                2007                                              |   | September                2006                                        |   |
|----------------------------------------|----------------------------------------------------------------------------|--------|----------------------------------------------------------------------|--------|
| Total                Assets            | $         513,414             |   | $         569,456       |   |
| Total                Liabilities       | 806,826                                                                    |   | 816,901                                                              |
| Gateway                Deficit         | (176,649)                                                                  |   | (131,142)                                                            |
| Other                Partner's Deficit | (116,763)                                                                  |   | (116,303)                                                            |
| Total                Revenue           | 84,287                                                                     |   | 81,245                                                               |
| Net                Loss                | $           (8,168) |   | $          (4,886) |
|                                   |                                                                       |   |                                                                 |

----

| NOTE                5 - INVESTMENTS IN PROJECT PARTNERSHIPS                (continued):                                                                                                                                                                                                                                                                                                                                                                             |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |
| In                accordance with Gateway's policy of presenting the financial information                of the Project Partnerships on a three month lag, below is the summarized                balance sheets for the Project Partnerships of Series 9 and Series                10 as                of September 30 and the respective summarized statements of operations                for                the nine months ended September 30 of each year: |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | SERIES                9 |   |   | SERIES                10 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | 2007 |   |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| SUMMARIZED                BALANCE SHEETS                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
|     Current                assets                                                                                                                                                                                                                                                                                                                                                                                                               |   | $ | 2,402,583 |   |   | $ | 2,313,427 |   |   | $ | 2,032,086 |   |   | $ | 1,892,404 |   |
|     Investment                properties, net                                                                                                                                                                                                                                                                                                                                                                                                   |   |   | 15,219,253 |   |   |   | 15,893,803 |   |   |   | 11,541,980 |   |   |   | 11,914,334 |   |
|     Other                assets                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   | 22,886 |   |   |   | 4,801 |   |   |   | 13,381 |   |   |   | 4,455 |   |
|         Total                assets                                                                                                                                                                                                                                                                                                                                                                                         |   | $ | 17,644,722 |   |   | $ | 18,212,031 |   |   | $ | 13,587,447 |   |   | $ | 13,811,193 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities                and Partners' Equity (Deficit):                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Current                liabilities                                                                                                                                                                                                                                                                                                                                                                                                          |   | $ | 94,021 |   |   | $ | 178,076 |   |   | $ | 230,389 |   |   | $ | 215,271 |   |
|     Long-term                debt                                                                                                                                                                                                                                                                                                                                                                                                               |   |   | 19,818,860 |   |   |   | 19,934,839 |   |   |   | 12,982,207 |   |   |   | 13,054,976 |   |
|         Total                liabilities                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 19,912,881 |   |   |   | 20,112,915 |   |   |   | 13,212,596 |   |   |   | 13,270,247 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Partners'                equity (deficit)                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Limited                Partner                                                                                                                                                                                                                                                                                                                                                                                                              |   |   | (1,902,977 | ) |   |   | (1,562,844 | ) |   |   | 802,441 |   |   |   | 947,250 |   |
|     General                Partners                                                                                                                                                                                                                                                                                                                                                                                                             |   |   | (365,182 | ) |   |   | (338,040 | ) |   |   | (427,590 | ) |   |   | (406,304 | ) |
|         Total                partners' equity (deficit)                                                                                                                                                                                                                                                                                                                                                                     |   |   | (2,268,159 | ) |   |   | (1,900,884 | ) |   |   | 374,851 |   |   |   | 540,946 |   |
|         Total                liabilities and partners' equity (deficit)                                                                                                                                                                                                                                                                                                                                                     |   | $ | 17,644,722 |   |   | $ | 18,212,031 |   |   | $ | 13,587,447 |   |   | $ | 13,811,193 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| SUMMARIZED                STATEMENTS OF OPERATIONS                                                                                                                                                                                                                                                                                                                                                                                                                  |   |
| Rental                and other income                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $ | 2,072,220 |   |   | $ | 1,952,232 |   |   | $ | 1,402,835 |   |   | $ | 1,314,464 |   |
| Expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Operating                expenses                                                                                                                                                                                                                                                                                                                                                                                                           |   |   | 1,350,412 |   |   |   | 1,278,850 |   |   |   | 924,779 |   |   |   | 881,245 |   |
|     Interest                expense                                                                                                                                                                                                                                                                                                                                                                                                             |   |   | 311,489 |   |   |   | 318,788 |   |   |   | 170,932 |   |   |   | 177,147 |   |
|     Depreciation                and amortization                                                                                                                                                                                                                                                                                                                                                                                                |   |   | 581,196 |   |   |   | 575,898 |   |   |   | 349,431 |   |   |   | 349,419 |   |
|         Total                expenses                                                                                                                                                                                                                                                                                                                                                                                       |   |   | 2,243,097 |   |   |   | 2,173,536 |   |   |   | 1,445,142 |   |   |   | 1,407,811 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|             Net                loss                                                                                                                                                                                                                                                                                                                                                                     |   | $ | (170,877 | ) |   | $ | (221,304 | ) |   | $ | (42,307 | ) |   | $ | (93,347 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                partners' share of net loss                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $ | (1,709 | ) |   | $ | (2,213 | ) |   | $ | (902 | ) |   | $ | (2,420 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gateway's                share of net loss                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $ | (169,168 | ) |   | $ | (219,091 | ) |   | $ | (41,405 | ) |   | $ | (90,927 | ) |
| Suspended                (unsuspended) losses                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | 112,780 |   |   |   | 172,869 |   |   |   | (2,423 | ) |   |   | 35,374 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity                in Losses of Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                             |   | $ | (56,388 | ) |   | $ | (46,222 | ) |   | $ | (43,828 | ) |   | $ | (55,553 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| NOTE                5 - INVESTMENTS IN PROJECT PARTNERSHIPS                (continued):                                                                                                                                                                                                                                                                                                                                                                                                       |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |
| In                accordance with Gateway's policy of presenting the financial information                of the Project Partnerships on a three month lag, below is the summarized                balance sheets for the Project Partnerships of Series 11 and Total                Series                7 - 11 as of September 30 and the respective summarized statements                of                operations for the nine months ended September 30 of each                year: |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | SERIES                11 |   | TOTAL              SERIES 7 - 11 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | 2007 |   |   | 2006 |   | 2007 |   |   | 2006 |   |   |
| SUMMARIZED                BALANCE SHEETS                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Current                assets                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | $ | 1,175,479 |   |   | $ | 1,144,502 |   |   | $ | 15,345,015 |   |   | $ | 14,217,398 |   |
|     Investment                properties, net                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   | 9,935,511 |   |   |   | 9,969,312 |   |   |   | 87,737,833 |   |   |   | 91,470,564 |   |
|     Other                assets                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   | 272,127 |   |   |   | 266,167 |   |   |   | 412,432 |   |   |   | 410,551 |   |
|         Total                assets                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $ | 11,383,117 |   |   | $ | 11,379,981 |   |   | $ | 103,495,280 |   |   | $ | 106,098,513 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities                and Partners' Equity (Deficit):                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Current                liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $ | 148,332 |   |   | $ | 135,433 |   |   | $ | 1,880,761 |   |   | $ | 1,973,122 |   |
|     Long-term                debt                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   | 10,300,844 |   |   |   | 9,807,256 |   |   |   | 115,809,164 |   |   |   | 115,972,311 |   |
|         Total                liabilities                                                                                                                                                                                                                                                                                                                                                                                                              |   |   | 10,449,176 |   |   |   | 9,942,689 |   |   |   | 117,689,925 |   |   |   | 117,945,433 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Partners'                equity (deficit)                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Limited                Partner                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   | 1,242,814 |   |   |   | 1,722,224 |   |   |   | (11,930,217 | ) |   |   | (9,738,791 | ) |
|     General                Partners                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | (308,873 | )  |   |   | (284,932 | ) |   |   | (2,264,428 | ) |   |   | (2,108,129 | ) |
|         Total                partners' equity (deficit)                                                                                                                                                                                                                                                                                                                                                                                               |   |   | 933,941 |   |   |   | 1,437,292 |   |   |   | (14,194,645 | ) |   |   | (11,846,920 | ) |
|         Total                liabilities and partners' equity (deficit)                                                                                                                                                                                                                                                                                                                                                                               |   | $ | 11,383,117 |   |   | $ | 11,379,981 |   |   | $ | 103,495,280 |   |   | $ | 106,098,513 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| SUMMARIZED                STATEMENTS OF OPERATIONS                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Rental                and other income                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | $ | 1,266,752 |   |   | $ | 1,247,792 |   |   | $ | 12,862,084 |   |   | $ | 12,347,858 |   |
| Expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Operating                expenses                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   | 872,192 |   |   |   | 800,328 |   |   |   | 8,404,160 |   |   |   | 8,060,036 |   |
|     Interest                expense                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | 159,581 |   |   |   | 159,267 |   |   |   | 1,820,341 |   |   |   | 1,849,911 |   |
|     Depreciation                and amortization                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   | 373,065 |   |   |   | 378,990 |   |   |   | 3,546,318 |   |   |   | 3,522,936 |   |
|         Total                expenses                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   | 1,404,838 |   |   |   | 1,338,585 |   |   |   | 13,770,819 |   |   |   | 13,432,883 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|             Net                loss                                                                                                                                                                                                                                                                                                                                                                                               |   | $ | (138,086 | )  |   | $ | (90,793 | ) |   | $ | (908,735 | ) |   | $ | (1,085,025 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                partners' share of net loss                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $ | (5,730 | )  |   | $ | (4,162 | ) |   | $ | (14,308 | ) |   | $ | (17,429 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gateway's                share of net loss                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $ | (132,356 | )  |   | $ | (86,631 | ) |   | $ | (894,427 | ) |   | $ | (1,067,596 | ) |
| Suspended                losses                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   | 70,185 |   |   |   | 91,276 |   |   |   | 690,308 |   |   |   | 931,120 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity                in (Losses) Income of Project Partnerships                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $ | (62,171 | )  |   | $ | 4,645 |   |   | $ | (204,119 | ) |   | $ | (136,476 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

----

----

----

----

----

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

| Date:                February                14,                2008 | By:/s/                Ronald M.                DinerRonald                M. DinerPresident,                Director                        |
|----------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                 |                                                                                                                                        |
|                                                                 |                                                                                                                                        |
|                                                                 |
| Date:February                14,                2008                 | By:/s/                Jonathan                OorlogJonathan                OorlogVice                President and Chief Financial Officer |
|                                                                 |                                                                                                                                        |
|                                                                 |
|                                                                 |
| Date:February                14,                2008                 | By:/s/                Sandra C.                HumphreysSandra                C. HumphreysSecretary                and Treasurer            |

----