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

                                    FORM 10-Q



(Mark One)


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


For the quarterly period ended December 15, 2005


                                       OR


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



                         COMMISSION FILE NUMBER 0-17015

                          LIBERTY TAX CREDIT PLUS L.P.
             (Exact name of registrant as specified in its charter)



           Delaware                                              13-3446500
--------------------------------                           ---------------------
(State or other jurisdiction of                             (I.R.S. Employer
  incorporation or organization)                             Identification No.)

 625 Madison Avenue, New York, New York                            10022
----------------------------------------                   ---------------------
(Address of principal executive offices)                         (Zip Code)



Registrant's telephone number, including area code (212) 317-5700


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


     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Exchange Act Rule 12b-2). Yes [ ] No [X]

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

<PAGE>
                         PART I - Financial Information

Item 1. Financial Statements

                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                           Consolidated Balance Sheets
<TABLE>
<CAPTION>
                                                                      December 15,        March 15,
                                                                         2005               2005
                                                                     -------------      -------------
                                                                      (Unaudited)         (Audited)

                                             ASSETS

Operating Assets
<S>                                                                  <C>                <C>
   Property and equipment, at cost, net of accumulated
     depreciation of $69,952,154 and $96,840,139,
     respectively                                                    $  58,645,752      $  86,316,389
   Cash and cash equivalents                                             6,617,003          4,335,171
   Cash held in escrow                                                   8,437,834         10,529,679
   Accounts receivable - tenants                                           295,948            761,215
   Deferred costs, net of accumulated amortization of
     $811,017 and $1,662,029, respectively                               1,198,361          1,922,580
   Other assets                                                          2,214,949          1,230,423
                                                                     -------------      -------------

Total operating assets                                                  77,409,847        105,095,457
                                                                     -------------      -------------

Assets from discontinued operations (Note 4)
  Property and equipment held for sale, net of accumulated
     depreciation
     of $18,032,393 and $13,195,220, respectively                       11,872,222         11,193,351
  Net assets held for sale                                               2,749,047          4,452,896
                                                                     -------------      -------------
Total assets from discontinued operations                               14,621,269         15,646,247
                                                                     -------------      -------------

Total assets                                                         $  92,031,116      $ 120,741,704
                                                                     =============      =============

                               LIABILITIES AND PARTNERS' DEFICIT

Operating Liabilities

  Mortgage notes payable                                             $  63,984,220      $  97,203,309
  Accounts payable                                                       3,848,099          2,436,882
  Accrued interest payable                                               8,525,754          7,885,329
  Security deposits payable                                                391,747            624,852
  Due to local general partners and affiliates                          19,647,288         21,080,176
  Due to general partners and affiliates                                 8,056,364          8,261,783
  Due to selling partners                                                        0          1,412,272
                                                                     -------------      -------------

Total operating liabilities                                            104,453,472        138,904,603
                                                                     -------------      -------------

Liabilities from discontinued operations (Note 4)
  Mortgage notes payable of assets held for sale                        18,806,852         12,032,637
  Net liabilities held for sale (including minority interest)            1,399,496          2,076,114
                                                                     -------------      -------------
Total liabilities from discontinued operations                          20,206,348         14,108,751
                                                                     -------------      -------------

Minority interests                                                        (682,229)          (321,605)
                                                                     -------------      -------------

Commitments and contingencies (Note 5)

Partners' deficit:
  Limited partners (15,987.5 BACs issued and outstanding)              (30,904,591)       (30,908,125)
  General partners                                                      (1,041,884)        (1,041,920)
                                                                     -------------      -------------


Total partners' deficit                                                (31,946,475)       (31,950,045)
                                                                     -------------      -------------

Total liabilities and partners' deficit                              $  92,031,116      $ 120,741,704
                                                                     =============      =============
</TABLE>

          See accompanying notes to consolidated financial statements.

                                       2
<PAGE>

                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                      Consolidated Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                       Three Months Ended                 Nine Months Ended
                                                           December 15,                      December 15,
                                                  -----------------------------     -----------------------------
                                                      2005             2004*            2005             2004*
                                                  ------------     ------------     ------------     ------------
<S>                                               <C>              <C>              <C>              <C>
Operations:

Revenues
Rental income                                     $  4,860,185     $  4,815,859     $ 14,383,691     $ 14,148,307
Other                                                  100,912           96,128          285,534          476,795
                                                  ------------     ------------     ------------     ------------
                                                     4,961,097        4,911,987       14,669,225       14,625,102
                                                  ------------     ------------     ------------     ------------

Expenses
General and administrative                             831,779          795,180        2,296,053        2,458,476
General and administrative-related
  parties (Note 2)                                     539,628          471,016        1,531,116        1,404,255
Repairs and maintenance                              1,330,546        1,233,304        4,148,989        3,790,303
Operating and other                                    702,749          479,963        2,055,141        1,877,193
Taxes                                                  249,232          262,675          711,027          624,030
Insurance                                              305,215          281,055          857,419          807,085
Financial                                            1,330,994        1,629,584        3,932,737        4,539,190
Depreciation and amortization                        1,106,577        1,139,961        3,319,475        3,341,254
                                                  ------------     ------------     ------------     ------------

Total expenses from operations                       6,396,720        6,292,738       18,851,957       18,841,786
                                                  ------------     ------------     ------------     ------------

Loss from operations before minority interest       (1,435,623)      (1,380,751)      (4,182,732)      (4,216,684)

Minority interest in loss of subsidiaries
  from operations                                        1,386            4,112            7,201            8,661
                                                  ------------     ------------     ------------     ------------

Loss from operations                                (1,434,237)      (1,376,639)      (4,175,531)      (4,208,023)

Discontinued Operations:
Income from discontinued operations (including
  gain on sale of properties)(Note 4)                5,990,094        3,682,222        6,117,222        5,648,517
                                                  ------------     ------------     ------------     ------------
 Net income                                       $  4,555,857     $  2,305,583     $  1,941,691     $  1,440,494
                                                  ============     ============     ============     ============

Loss from operations - limited partners           $ (1,419,895)    $ (1,362,873)    $ (4,133,776)    $ (4,165,943)
Income from discontinued operations (including
  gain on sale of properties) - limited partners     5,930,193        3,645,400        6,056,050        5,592,032
                                                  ------------     ------------     ------------     ------------
Net income - limited partners                     $  4,510,298     $  2,282,527     $  1,922,274     $  1,426,089
                                                  ============     ============     ============     ============

Number of BACs outstanding                            15,987.5         15,987.5         15,987.5         15,987.5
                                                  ============     ============     ============     ============

Loss from operations per BAC                      $     (88.81)    $     (85.25)    $    (258.56)    $    (260.58)
Income from discontinued operations per BAC             370.93           228.02           378.80           349.78
                                                  ------------     ------------     ------------     ------------

Net income per BAC                                $     282.12     $     142.77     $     120.24     $      89.20
                                                  ============     ============     ============     ============
</TABLE>

 *  Reclassified for comparative purposes

          See accompanying notes to consolidated financial statements.


                                       3
<PAGE>

                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
             Consolidated Statement of Changes in Partners' Deficit
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                    Limited         General
                                                     Total          Partners        Partner
                                                  ------------    ------------    ------------
<S>                                               <C>             <C>             <C>
Partners' deficit - March 16, 2005                $(31,950,045)   $(30,908,125)   $ (1,041,920)

Net income                                           1,941,691       1,922,274          19,417

Distributions                                       (1,938,121)     (1,918,740)        (19,381)
                                                  ------------    ------------    ------------

Partners' deficit - December 15, 2005             $(31,946,475)   $(30,904,591)   $ (1,041,884)
                                                  ============    ============    ============
</TABLE>


           See accompanying notes to consolidated financial statements

                                       4
<PAGE>
                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                Increase (decrease) in Cash and Cash Equivalents
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                         Nine Months Ended
                                                                                            December 15,
                                                                                   -----------------------------
                                                                                       2005             2004*
                                                                                   ------------     ------------
<S>                                                                                <C>              <C>
Net income                                                                         $  1,941,691     $  1,440,494

Adjustments to reconcile net income to net cash (used in) provided by
  operating activities:
  Gain on sale of properties                                                        (10,550,777)      (4,427,642)
  Depreciation and amortization                                                       4,936,374        6,202,008
  Loss on impairment of fixed assets                                                  2,710,000                0
  Minority interest in income of subsidiaries                                          (272,357)      (3,526,100)
  Decrease in accounts receivable - tenants                                             147,056          243,674
  Increase in other assets                                                           (1,275,872)        (571,546)
  Increase (decrease) in accounts payable                                             2,627,491         (489,993)
  Increase in accrued interest payable                                                  763,916        1,645,959
  Decrease in security deposits payable                                                 (50,038)          (1,516)
  Increase in due to general partners and affiliates                                     55,727        1,001,714
  Increase in cash held in escrow                                                    (1,431,645)        (698,962)
                                                                                   ------------     ------------

Net cash (used in) provided by operating activities                                    (398,434)         818,090
                                                                                   ------------     ------------

Cash flows from investing activities:

  Decrease in cash held in escrow                                                     1,179,131          288,138
  Proceeds from sale of investments                                                   7,684,400        1,224,789
  Costs paid relating to sale of properties                                            (222,016)               0
  Improvements to property and equipment                                               (563,131)      (1,099,721)
                                                                                   ------------     ------------

Net cash provided by investing activities                                             8,078,384          413,206
                                                                                   ------------     ------------

Cash flows from financing activities:

  Repayments of mortgage notes                                                       (4,482,822)      (1,828,243)
  Increase in due to local general partners and affiliates                            1,027,345        1,061,896
  Decrease in due to local general partners and affiliates                                    0         (329,044)
  (Decrease) increase in capitalization of consolidated subsidiaries
    attributable to minority interest                                                  (235,594)         287,560
  Distributions                                                                      (1,938,121)               0
                                                                                   ------------     ------------

  Net cash used in financing activities                                              (5,629,192)        (807,831)
                                                                                   ------------     ------------

  Net increase in cash and cash equivalents                                           2,050,758          423,465

  Cash and cash equivalents at beginning of period                                    4,779,438        5,224,728
                                                                                   ------------     ------------

  Cash and cash equivalents at end of period                                       $  6,830,196     $  5,648,193
                                                                                   ============     ============

  Summarized below are the components of the gain on sale of properties:

  Decrease in property and equipment, net of accumulated depreciation              $ 19,996,475     $ 17,207,232
  Decrease in mortgage notes payable                                                (21,962,052)     (21,261,879)
  Decrease in due to general partners and affiliates                                   (252,500)        (474,583)
  Decrease in due to local general partner and affiliates                            (2,256,995)        (257,744)
  Decrease in due to selling partners                                                (1,412,272)               0
  Decrease in cash held in escrow                                                     4,554,061          752,892
  Decrease in rents receivable                                                          220,458           46,776
  Decrease in other assets                                                               99,161          305,553
  Decrease in accounts payable                                                       (1,117,566)        (138,525)
  Decrease in accrued interest payable                                                 (763,557)      (2,236,444)
  Decrease in security deposits payable                                                (112,271)        (157,193)
  Decrease in deferred costs                                                            189,278          461,952
  (Decrease) increase in capitalization of consolidated subsidiaries
    attributable to minority interest                                                  (270,613)       2,549,110
</TABLE>

 See Note 4 for cash flows from discontinued operations.

* Reclassified for comparative purposes.

           See accompanying notes to consolidated financial statements

                                       5
<PAGE>
                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 15, 2005
                                   (Unaudited)

Note 1 - General

The  consolidated  financial  statements  for the nine months ended December 15,
2005 and 2004,  include  the  accounts  of  Liberty  Tax Credit  Plus L.P.  (the
"Partnership")  and  23 and  27  subsidiary  partnerships  (each  a  "subsidiary
partnership" or "Local Partnership"),  respectively, in which the Partnership is
a  limited  partner.  Through  the  rights of the  Partnership  and/or a general
partner of the  Partnership (a "General  Partner"),  which General Partner has a
contractual  obligation  to act on behalf  of the  Partnership,  to  remove  the
general partners of each subsidiary  partnership (the "Local General  Partners")
and to approve certain major operating and financial decisions,  the Partnership
has a  controlling  financial  interest  in  the  subsidiary  partnerships.  All
intercompany  accounts and transactions  with the subsidiary  partnerships  have
been eliminated in consolidation.

For financial  reporting  purposes,  the  Partnership's  fiscal  quarter ends on
December 15. All subsidiary  partnerships  have fiscal quarters ending September
30. Accounts of the subsidiary  partnerships have been adjusted for intercompany
transactions from October 1 through December 15. The Partnership's  quarter ends
on December 15 in order to allow adequate time for the  subsidiary  partnerships
financial  statements to be prepared and consolidated.  The books and records of
the Partnership are maintained on the accrual basis of accounting, in accordance
with accounting  principles  generally  accepted in the United States of America
("GAAP").

In the opinion of the General  Partners,  the accompanying  unaudited  financial
statements  contain  all  adjustments   (consisting  only  of  normal  recurring
adjustments)   necessary  to  present  fairly  the  financial  position  of  the
Partnership  as of  December  15,  2005 and  March  15,  2005,  the  results  of
operations  for the three and nine months  ended  December 15, 2005 and 2004 and
cash flows for the nine months ended  December 15, 2005 and 2004.  However,  the
operating results and cash flows for the nine months ended December 15, 2005 may
not be indicative of the results for the year.

Certain  information  and  note  disclosures  which  are  normally  included  in
financial  statements  prepared  in  accordance  with GAAP have been  omitted or
condensed. These consolidated financial statements should be read in conjunction
with the financial  statements and notes thereto  included in the  Partnership's
Annual Report on Form 10-K for the period ended March 15, 2005.

Increases  (decreases)  in  the  capitalization  of  consolidated   subsidiaries
attributable  to  minority  interest  arise  from  cash  contributions  and cash
distributions to the minority interest partners.

The  Partnership's  investment in each  subsidiary  partnership  is equal to the
respective  subsidiary  partnership's  partners'  equity less minority  interest
capital,  if any.  Losses  attributable  to minority  interests which exceed the
minority interests' investments in the subsidiary partnerships have been charged
to the Partnership.  Such losses aggregate approximately $0 and $738,000 for the
three and nine month periods ended December 15, 2005,  respectively,  and $0 for
both the three and nine month periods ended December 15, 2004. In consolidation,
all  subsidiary  partnership  losses are included in the  Partnership's  capital
account except for losses allocated to minority interest capital.


Note 2 - Related Party Transactions

An affiliate of the General  Partners  has a 1% interest,  as a special  limited
partner,  in each of the  subsidiary  partnerships.  An affiliate of the General
Partners also has a minority interest in certain subsidiary partnerships.

The costs  incurred to related  parties from  operations  for the three and nine
months ended December 15, 2005 and 2004 were as follows:
<TABLE>
<CAPTION>
                                                             Three Months Ended          Nine Months Ended
                                                                 December 15,                December 15,
                                                          ------------------------    ------------------------
                                                             2005          2004*         2005          2004*
                                                          ----------    ----------    ----------    ----------
<S>                                                       <C>           <C>           <C>           <C>
Partnership management fees (a)                           $  222,750    $  269,250    $  670,750    $  800,250
Expense reimbursement (b)                                    138,473        47,431       347,542       131,675
Local administrative fee (d)                                   4,750         3,875        13,250        11,625
                                                          ----------    ----------    ----------    ----------
Total general and administrative-General Partners            365,973       320,556     1,031,542       943,550
                                                          ----------    ----------    ----------    ----------
Property management fees incurred to affiliates of the
  local general partners (c)                                 173,655       150,460       499,574       460,705
                                                          ----------    ----------    ----------    ----------
Total general and administrative-related parties          $  539,628    $  471,016    $1,531,116    $1,404,255
                                                          ==========    ==========    ==========    ==========
</TABLE>

* Reclassified for comparative purpose.


                                       6
<PAGE>
                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 15, 2005
                                   (Unaudited)

The costs incurred to related parties from discontinued operations for the three
and nine months ended December 15, 2005 and 2004 were as follows:
<TABLE>
<CAPTION>
                                                           Three Months Ended      Nine Months Ended
                                                               December 15,           December 15,
                                                          --------------------    --------------------
                                                            2005        2004        2005        2004
                                                          --------    --------    --------    --------
<S>                                                       <C>         <C>         <C>         <C>
Property management fees incurred to affiliates of the
  General Partners (c)                                    $      0    $ 15,769    $      0    $ 63,075
Local administrative fee (d)                                 7,250       9,125      21,750      27,375
                                                          --------    --------    --------    --------
Total general and administrative-General Partners            7,250      24,894      21,750      90,450
                                                          --------    --------    --------    --------
Property management fees incurred to affiliates of the
  local general partners (c)                                42,334      68,676     186,665     229,829
                                                          --------    --------    --------    --------
Total general and administrative-related parties          $ 49,584    $ 93,570    $208,415    $320,279
                                                          ========    ========    ========    ========
</TABLE>

(a) The General  Partners are entitled to receive a partnership  management fee,
after payment of all Partnership expenses,  which together with the local annual
administrative  fees  will not  exceed a maximum  of 0.5% per annum of  invested
assets (as  defined in the  Partnership's  Amended  and  Restated  Agreement  of
Limited  Partnership),  for  administering  the affairs of the Partnership.  The
partnership  management  fee,  subject  to the  foregoing  limitation,  will  be
determined  by the General  Partners in their sole  discretion  based upon their
review of the Partnership's investments. Partnership management fees owed to the
General  Partners  amounting to  approximately  $7,932,000 and  $7,811,000  were
accrued and unpaid as of December 15, 2005 and March 15, 2005, respectively.

(b) The  Partnership  reimburses the General  Partners and their  affiliates for
actual Partnership operating expenses incurred by the General Partners and their
affiliates on the  Partnership's  behalf.  The amount of reimbursement  from the
Partnership is limited by the provisions of the Partnership  Agreement.  Another
affiliate of the General Partners performs asset monitoring for the Partnership.
These   services   include  site  visits  and   evaluations  of  the  subsidiary
partnerships' performance. Expense reimbursements and asset monitoring fees owed
to Related Credit Properties L.P., a General Partner, amounting to approximately
$58,000 and $35,000  were  accrued and unpaid as of December  15, 2005 and March
15, 2005, respectively.

The General Partners have allowed for the accrual without payment of the amounts
set forth in (a) and (b) but are under no obligation to continue to do so.

(c)  Property  management  fees  incurred  by  the  subsidiary  partnerships  in
operations  amounted to $355,836 and $419,437 and  $1,105,978 and $1,313,094 for
the three and nine months  ended  December 15, 2005 and 2004,  respectively.  Of
these fees,  $215,989 and $219,136  and $686,239 and $690,534  were  incurred to
affiliates of the local general partners,  which include $42,334 and $68,676 and
$186,665 and $229,829 of fees relating to discontinued operations.  In addition,
$15,769 and $63,075 was incurred to affiliates  of the General  Partners for the
three and nine  months  ended  December  15,  2004,  which is also  included  in
discontinued operations.

(d) Liberty  Associates  III L.P.,  a General  Partner  and the special  limited
partner  of  the  subsidiary  partnerships,  is  entitled  to  receive  a  local
administrative fee of up to $2,500 per year from each subsidiary partnership.


Note 3 - Sale of Properties

The Partnership is currently in the process of disposing of its investments.  As
of December  15,  2005,  the  Partnership  has disposed of 14 of its 31 original
investments.

On November 28, 2005, the Partnership entered into a purchase and sale agreement
to sell the property and the related assets and liabilities of Willoughby/Wycoff
Housing Associates, L.P. ("Willoughby") to an unaffiliated third party purchaser
for a purchase price of $4,800,000.  The sales  documents have been executed and
the initial  deposit funds are being held in escrow.  An expected  closing could
occur in February  2006.  No assurance  can be given that the sale will actually
occur.  Willoughby  is being held as an asset held for sale as of  December  15,
2005. As of September 30, 2005, Willoughby had property and equipment,  at cost,
of   approximately   $6,191,000,   accumulated   depreciation  of  approximately
$3,762,000 and mortgage debt of approximately $4,017,000.

On  September  22,  2005,  the  Partnership  entered  into a  purchase  and sale
agreement to sell the property and the related  assets and  liabilities  of 2051
Grand Concourse Housing Associates,  L.P. ("Grand Concourse") to an unaffiliated
third party  purchaser for a purchase price of $4,937,500.  The sales  documents
have been executed and the initial  deposit  funds are being held in escrow.  An
expected  closing  could occur in March 2006. No assurance can be given that the
sale will  actually  occur.  Grand  Concourse is being held as an asset held for
sale as of December 15, 2005.  As of September  30, 2005,  Grand  Concourse  had
property  and  equipment,  at cost,  of  approximately  $5,271,000,  accumulated
depreciation  of  approximately  $3,208,000  and mortgage debt of  approximately
$3,281,000.


                                       7
<PAGE>
                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 15, 2005
                                   (Unaudited)

On  September  22,  2005,  the  Partnership  entered  into a  purchase  and sale
agreement  to sell the  property  and the  related  assets  and  liabilities  of
Concourse  Artist's  Housing  Associates,  L.P.  ("Concourse  Artist's")  to  an
unaffiliated third party purchaser for a purchase price of $1,797,500. The sales
documents  have been  executed and the initial  deposit  funds are being held in
escrow. An expected closing could occur in March 2006. No assurance can be given
that the sale will actually occur.  Concourse Artist's is being held as an asset
held for sale as of December 15,  2005.  As of  September  30,  2005,  Concourse
Artist's had property  and  equipment,  at cost,  of  approximately  $2,285,000,
accumulated  depreciation  of  approximately  $1,386,000  and  mortgage  debt of
approximately $1,412,000.

On  September  22,  2005,  the  Partnership  entered  into a  purchase  and sale
agreement to sell the property and the related  assets and  liabilities of Robin
Housing  Associates,  L.P.  ("Robin  Housing")  to an  unaffiliated  third party
purchaser for a purchase  price of  $7,265,000.  The sales  documents  have been
executed  and the initial  deposit  funds are being held in escrow.  An expected
closing  could occur in March 2006. No assurance can be given that the sale will
actually  occur.  Robin  Housing  is being  held as an asset held for sale as of
December 15,  2005.  As of September  30, 2005,  Robin  Housing had property and
equipment,  at cost, of approximately  $8,238,000,  accumulated  depreciation of
approximately $5,022,000 and mortgage debt of approximately $4,903,000.

On  September  15,  2005,  the  Partnership's  limited  partnership  interest in
Bayridge Associates,  L.P.  ("Bayridge") was sold to an unaffiliated third party
purchaser  for  $1,125,000.  The  sale  resulted  in  a  gain  of  approximately
$5,920,000.  The sale resulted in the  liquidation  of Bayridge.  As of the sale
date,   Bayridge  had  property  and  equipment,   at  cost,  of   approximately
$13,231,000,  accumulated  depreciation of approximately $7,270,000 and mortgage
debt of approximately $9,598,000.

On July 27, 2005,  the property and the related  assets and  liabilities of Penn
Alto  Associates,  L.P. ("Penn Alto") were sold to an  unaffiliated  third party
purchaser  for  $1,575,000.  During the quarter  ended  September  15, 2005,  in
accordance with Statement of Financial  Accounting  Standards  ("SFAS No. 144"),
the Partnership deemed the building impaired and wrote it down to its fair value
which resulted in a loss on impairment of $850,000.  The sale resulted in a gain
of approximately $127,000. The sale resulted in the liquidation of Penn Alto. As
of  the  sale  date,  Penn  Alto  had  property  and  equipment,   at  cost,  of
approximately $11,106,000,  accumulated depreciation of approximately $6,236,000
and mortgage debt of approximately $3,383,000.

On June 2, 2005,  the  Partnership  sold its  limited  partnership  interest  in
Lancaster  Towers  Associates,  LTD  ("Lancaster")  to an affiliate of the Local
General Partner for a purchase price of $449,750.  During the quarter ended June
15, 2005, in accordance with SFAS No. 144, the  Partnership  deemed the building
impaired  and  wrote  it down to its  fair  value  which  resulted  in a loss on
impairment  of  $1,860,000.  The sale  resulted in a  distribution  to the Local
General Partner of approximately  $271,000.  As of the sale date,  Lancaster had
property  and  equipment,  at cost,  of  approximately  $4,594,000,  accumulated
depreciation  of  approximately  $2,757,000  and mortgage debt of  approximately
$1,605,000.

On April 25, 2005, the Partnership  entered into a redemption  agreement for the
sale of its limited  partnership  interest in Fox Glenn  Investors,  L.P.  ("Fox
Glenn") to the Local General Partner. The sales documents have been executed and
the  Partnership  received  $200,000 and a note  receivable  for  $1,200,000 due
February 9, 2006 that is recorded in other assets. As of September 15, 2005, the
Partnership has recorded the $1,400,000 in accrued  expenses as a deferred gain.
Fox Glenn is awaiting  approval of the sale from the  Department  of Housing and
Urban Development  ("HUD"). No assurances can be given that the HUD will approve
the sale.  Fox Glenn is being held as an asset held for sale as of December  15,
2005. As of September 30, 2005, Fox Glenn had property and  equipment,  at cost,
of   approximately   $7,682,000,   accumulated   depreciation  of  approximately
$4,554,000 and mortgage debt of approximately $5,195,000.

On March 29, 2005, the property and the related assets and liabilities of Regent
Street  Associates,  L.P. ("Regent  Street") were sold to an unaffiliated  third
party purchaser for the assumption of the outstanding debt,  resulting in a gain
of $1,436,000.  The sale resulted in the liquidation of Regent Street. As of the
sale date,  Regent Street had property and equipment,  at cost, of approximately
$7,655,000,  accumulated  depreciation of approximately  $4,610,000 and mortgage
debt of approximately $3,629,000.

On February 17, 2005, the Partnership's  limited partnership interest in Redwood
Villa Associates  ("Redwood") was sold to an unaffiliated  third party purchaser
for $60,000,  resulting in a gain of approximately $1,749,000. The sale resulted
in the  liquidation  of Redwood.  As of the sale date,  Redwood had property and
equipment,  at cost, of approximately  $5,999,000,  accumulated  depreciation of
approximately $3,525,000 and mortgage debt of approximately $3,746,000.

On January 5, 2005, the property and the related assets and  liabilities of Lund
Hill  Associates,  L.P. ("Lund Hill") were sold to an unaffiliated  thirty party
purchaser for $6,500,000,  resulting in a gain of approximately $1,356,000.  The
sale resulted in the  liquidation  of Lund Hill. As of the sale date,  Lund Hill
had property and equipment,  at cost, of approximately  $6,046,000,  accumulated
depreciation  of  approximately  $2,423,000  and mortgage debt of  approximately
$2,971,000.

On March 31, 2004, the Partnership's limited partnership interest in Walnut Park
Plaza  ("Walnut") was sold to the Local General  Partner for a purchase price of
$1 plus the  assumption  of all the  related  debt which  totaled  approximately
$7,700,000   resulting  in  a  general  partner  contribution  of  approximately
$2,549,000. The sale resulted in the liquidation of Walnut. As of the sale date,
Walnut had  property  and  equipment,  at cost,  of  approximately  $10,957,000,
accumulated  depreciation  of  approximately  $4,448,000  and  mortgage  debt of
approximately $7,330,000.

On September 24, 2004,  the property and the related  assets and  liabilities of
Autumn Park Associates,  L.P. ("Autumn Park") were sold to an unaffiliated third
party for $4,800,000.  The proceeds were used to settle the associated  mortgage
which had an outstanding  balance of approximately  $3,600,000,  and the balance
was  distributed  to the  partners  of Autumn  Park.  This amount  consisted  of
$900,000  paid in cash at the closing and  $150,000  pursuant to one  promissory
note.  The note  compounds  interest at 10% and was due on October 30,  2005.  A
demand  letter  is  being  sent to  commence  collection  proceedings.  The sale


                                       8
<PAGE>
                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 15, 2005
                                   (Unaudited)

resulted  in a gain  of  approximately  $1,992,000.  The  sale  resulted  in the
liquidation  of Autumn Park.  As of the sale date,  Autumn Park had property and
equipment,  at cost, of approximately  $6,138,000,  accumulated  depreciation of
approximately $3,488,000, and mortgage debt of approximately $3,754,000.

On August 27, 2004, the property and the related assets and  liabilities of 2108
Bolton Drive  Associated,  L.P.  ("Bolton") were sold to an  unaffiliated  third
party  for  $8,891,000,  resulting  in a gain of  approximately  $1,259,000.  An
additional  gain of  approximately  $363,000  was  recognized  during the fourth
quarter ended March 15, 2005. The sale resulted in the liquidation of Bolton. As
of the sale date,  Bolton had property and equipment,  at cost, of approximately
$13,601,000  accumulated  depreciation of approximately  $7,852,000 and mortgage
debt of approximately $7,266,000.

On July 30,  2004,  the  property  and the  related  assets and  liabilities  of
Tanglewood  Apartments,  L.P.  ("Tanglewood") were sold to an unaffiliated third
party for $3,425,000,  resulting in a gain of approximately $1,167,000. The sale
resulted in the liquidation of Tanglewood.  As of the sale date,  Tanglewood had
property  and  equipment,  at cost,  of  approximately  $5,902,000,  accumulated
depreciation  of  approximately  $3,148,000  and mortgage debt of  approximately
$2,852,000.


Note 4 - Discontinued Operations

The following table summarizes the financial  position of the Local Partnerships
that are classified as  discontinued  operations  because the  respective  Local
Partnerships  were  classified as assets held for sale. As of December 15, 2005,
Concourse Artist's,  Bayridge,  Bolton, Grand Concourse,  Fox Glenn,  Lancaster,
Lund Hill, Penn Alto, Redwood,  Regent Street, Robin Housing and Willoughby were
classified as discontinued  operations in the Consolidated Financial Statements.
As of March 15, 2005,  Bolton,  Lancaster,  Lund Hill, Redwood and Regent Street
were classified as discontinued operations on the Consolidated Balance Sheets.

Consolidated Balance Sheets of Discontinued Operations:
<TABLE>
<CAPTION>
                                                  December 15,        March 15,
                                                      2005              2005
                                                  ------------      ------------
<S>                                               <C>               <C>
 Assets
   Property and equipment, net of
     accumulated depreciation of $18,032,393
     and $13,195,220, respectively                $ 11,872,222      $ 11,193,351
  Cash and cash equivalents                            213,193           444,267
  Cash held in escrow                                1,641,876         3,851,578
  Deferred costs, net of accumulated
    amortization of $907,182 and
    $182,368, respectively                             515,178            68,189
  Other assets                                         378,800            88,862
                                                  ------------      ------------
Total assets                                      $ 14,621,269      $ 15,646,247
                                                  ============      ============

Liabilities
  Mortgage notes payable                          $ 18,806,852      $ 12,032,637
  Accounts payable and other liabilities               701,705         1,172,267
  Due to local general partners and
    affiliates                                         935,955           732,717
  Due to general partners and affiliates                58,146            49,500
  Minority interest                                   (296,310)          121,630
                                                  ------------      ------------
Total liabilities                                 $ 20,206,348      $ 14,108,751
                                                  ============      ============
</TABLE>

The  following  table   summarizes  the  results  of  operations  of  the  Local
Partnerships that are classified as discontinued  operations.  For the three and
nine months ended  December  15,  2005,  Concourse  Artist's,  Fox Glenn,  Grand
Concourse, Robin Housing and Willoughby which were classified as assets held for
sale, and Bayridge,  Lancaster, Lund Hill, Penn Alto, Redwood and Regent Street,
which were sold during the year, were all classified as discontinued  operations
on the Consolidated  Financial  Statements.  For the three and nine months ended
December 15, 2004 and in order to present  comparable  results for the three and
nine months  ended  December  15,  2005,  Concourse  Artist's,  Bayridge,  Grand
Concourse,  Fox Glenn, Lancaster,  Lund Hill, Penn Alto, Redwood, Regent Street,
Robin Housing and Willoughby were all classified as discontinued operations.  In
addition, Autumn Park, Bolton, Tanglewood and Walnut, which were sold during the
year ended March 15, 2005, were all classified as discontinued operations on the
Consolidated Financial Statements.

                                       9
<PAGE>
                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 15, 2005
                                   (Unaudited)

Consolidated Statements of Discontinued Operations:
<TABLE>
<CAPTION>
                                                           Three Months Ended            Nine Months Ended
                                                               December 15,                  December 15,
                                                       --------------------------    --------------------------
                                                          2005           2004            2005           2004
                                                       -----------    -----------    -----------    -----------
<S>                                                    <C>            <C>            <C>            <C>
 Revenues:

Rental income                                          $ 1,476,797    $ 3,056,397    $ 5,178,098    $ 9,574,953
Other                                                       36,595        189,905        139,846        361,993
Gain on sale of properties                               6,037,429      4,417,512     10,550,777      4,427,642
                                                       -----------    -----------    -----------    -----------
Total revenue                                            7,550,821      7,663,814     15,868,721     14,364,588
                                                       -----------    -----------    -----------    -----------

Expenses:

General and administrative                                 334,564        610,188      1,081,953      1,805,017
General and administrative-related parties (Note 2)         49,584         93,570        208,415        320,279
Repairs and maintenance                                    485,739        592,902      1,348,764      1,984,069
Operating                                                  205,339        432,013        987,396      1,523,863
Taxes                                                       59,939        112,753        246,277        469,699
Insurance                                                  121,979        169,005        333,692        574,532
Interest                                                   412,333        845,007      1,483,259      2,695,297
Depreciation and amortization                              433,302      1,126,846      1,616,899      2,860,754
Loss on impairment of fixed assets                               0              0      2,710,000              0
                                                       -----------    -----------    -----------    -----------

Total expenses                                           2,102,779      3,982,284     10,016,655     12,233,510
                                                       -----------    -----------    -----------    -----------

Income before minority interest                          5,448,042      3,681,530      5,852,066      2,131,078
Minority interest in income of subsidiaries from
  discontinued
  operations                                               542,052            692        265,156      3,517,439
                                                       -----------    -----------    -----------    -----------
Net income from discontinued operations (including
  gain on sale of properties)                          $ 5,990,094    $ 3,682,222    $ 6,117,222    $ 5,648,517
                                                       ===========    ===========    ===========    ===========

Income - limited partners from discontinued
  operations (including gain on sale of properties)    $ 5,930,193    $ 3,645,400    $ 6,056,050    $ 5,592,032
                                                       ===========    ===========    ===========    ===========

Number of BACs outstanding                                15,987.5       15,987.5       15,987.5       15,987.5
                                                       ===========    ===========    ===========    ===========

Income from discontinued operations (including gain
  on
   sale of properties) per BAC                         $    370.93    $    228.02    $    378.80    $    349.78
                                                       ===========    ===========    ===========    ===========

<CAPTION>

                                                                                          Nine Months Ended
                                                                                             December 15,
                                                                                     --------------------------
                                                                                        2005           2004
                                                                                     -----------    -----------
<S>                                                                                  <C>            <C>
 Cash flows from Discontinued Operations:

 Net cash provided by operating activities                                           $ 1,989,516    $    25,929
                                                                                     -----------    -----------
 Net cash provided by investing activities                                           $ 7,247,719    $ 3,823,625
                                                                                     -----------    -----------
 Net cash used in financing activities                                               $(1,837,967)   $  (814,413)
                                                                                     -----------    -----------
</TABLE>

                                       10
<PAGE>
                          LIBERTY TAX CREDIT PLUS L.P.
                                AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 15, 2005
                                   (Unaudited)

Note 5 - Commitments and Contingencies

a)  Uninsured Cash and Cash Equivalents

The  Partnership  maintains  its cash and cash  equivalents  in  various  banks.
Accounts  at  each  bank  are  guaranteed  by  the  Federal  Deposit   Insurance
Corporation (FDIC) up to $100,000.

b)  Cash Distributions

Cash distributions from the Local Partnerships to the Partnership are restricted
by the  provisions of the respective  Local  Partnership  agreements  and/or the
Department of Housing and Urban Development ("HUD"). Such cash distributions are
typically made from surplus cash flow.

c)  Tax Credits

A portion of the low income housing tax credits ("Tax Credits") could be subject
to  recapture  in  future  years  if (i) a  Local  Partnership  ceases  to  meet
qualification  requirements,  (ii) if there is a decrease in the qualified basis
of the Local Partnership  property or (iii) if there is a reduction in the Local
Partnership  interest in the  property  at any time  during the  15-year  period
commencing at the beginning of the period that entitles qualified  BACholders to
Tax Credits,  generally ten years from the date of investment or, if later,  the
date the property is leased to qualified  tenants ("Tax Credit  Period").  As of
December 31, 2003, the Tax Credit Period for each Local Partnership had expired.

d)  Other

The  Partnership  is subject to the risks  incident to potential  losses arising
from the management and ownership of improved real estate.  The  Partnership can
also be affected by poor economic conditions generally, however no more than 24%
of the  properties are located in any single state.  There are also  substantial
risks associated with owning properties  receiving  government  assistance,  for
example the possibility that Congress may not appropriate funds to enable HUD to
make rental assistance payments. HUD also restricts annual cash distributions to
partners  based on  operating  results and a  percentage  of the owners'  equity
contribution.  The  Partnership  cannot  sell  or  substantially  liquidate  its
investments  in  subsidiary  partnerships  during  the period  that the  subsidy
agreements are in existence, without HUD's approval.  Furthermore, there may not
be market demand for apartments at full market rents when the rental  assistance
contracts expire.


Note 6 - New Accounting Pronouncements

In June 2005, the Financial Accounting Standards Board ("FASB") issued Statement
of  Financial  Accounting  Standards  No.  154,  Accounting  Changes  and  Error
Corrections  ("FAS 154"). FAS 154 replaces  Accounting  Principles Board ("APB")
Opinion  No. 20,  Accounting  Changes  and  Statement  of  Financial  Accounting
Standards No. 3, Reporting  Accounting Changes in Interim Financial  Statements.
FAS 154  requires  that a voluntary  change in  accounting  principle be applied
retrospectively  with all prior period financial statements presented on the new
accounting  principle.  FAS  154  also  requires  that a  change  in  method  of
depreciating  or  amortizing a long-lived  nonfinancial  asset be accounted  for
prospectively  as a change in estimate,  and  correction of errors in previously
issued financial statements should be termed a restatement. FAS 154 is effective
for accounting  changes and correction of errors made in fiscal years  beginning
after December 15, 2005. The Partnership does not expect the adoption of FAS 154
to  have  a  material  impact  on  the  Partnership's   consolidated   financial
statements.

In June 2005, the FASB issued Emerging  Issues Task Force No. 04-5,  Determining
Whether a General  Partner,  or the  General  Partners  as a Group,  Controls  a
Limited  Partnership  or Similar  Entity When the Limited  Partners Have Certain
Rights ("EITF No. 04-5").  EITF No. 04-5 replaces  counterpart  requirements  in
Statement of Position  ("SOP") 78-9,  which provides  guidance on accounting for
investments in real-estate  ventures and limited partners.  Under EITF No. 04-5,
the general  partner's  control  would be overcome if the limited  partners have
either "kick-out rights" - the right to dissolve or liquidate the partnership or
otherwise remove the general partner "without cause" or "participating rights" -
the  right to  effectively  participate  in  significant  decisions  made in the
ordinary  course of the  partnership's  business.  The  kick-out  rights and the
participating  rights  must be  substantive  in order to  overcome  the  general
partner's control.  EITF 04-5 is now effective.  The Partnership does not expect
the  adoption  of EITF  05-4  to  have a  material  effect  on the  consolidated
financial statements.


                                       11
<PAGE>

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

Liquidity and Capital Resources
-------------------------------

The  Partnership's  capital has been  invested in 31 Local  Partnerships.  As of
December 15, 2005, the properties and the related assets and liabilities of nine
Local  Partnerships  and  the  limited   partnership   interest  in  five  Local
Partnerships   were  sold.  For  a  discussion  of  these  sales  of  the  Local
Partnerships, see Note 3 to the financial statements.

Short-Term
----------

The  Partnership's  primary  sources  of funds  included:  (i)  working  capital
reserves;  (ii)  interest  earned on the working  capital  reserves;  (iii) cash
distributions from operations of the Local Partnerships; and (iv) sales proceeds
and  distributions.  Such funds,  although  minimal,  are  available to meet the
obligations of the  Partnership.  During the nine months ended December 15, 2005
and 2004,  distributions from operations of the Local  Partnerships  amounted to
approximately $101,000 and $113,000, respectively. Additionally, during the nine
months ended December 15, 2005 and 2004, the Partnership received  approximately
$557,000 and $1,225,000 distributions of proceeds from sales.

For the nine months ended  December 15, 2005,  cash and cash  equivalents of the
Partnership and its  consolidated  Local  Partnerships  increased  approximately
$2,051,000.  This increase is  attributable to a decrease in cash held in escrow
relating to investing activities ($1,179,000), proceeds from sale of investments
($7,684,000)  and a net increase in due to local general partners and affiliates
($1,027,000)  which exceeded net cash used in operating  activities  ($398,000),
improvements to property and equipment  ($563,000),  costs paid relating to sale
of   properties   ($222,000),   repayments  of  mortgage   notes   ($4,483,000),
distributions  ($1,938,000)  and a decrease in  capitalization  of  consolidated
subsidiaries  attributable  to  minority  interest  ($236,000).  Included in the
adjustments to reconcile net income to net cash used in operating  activities is
depreciation  and amortization of  approximately  ($4,936,000),  gain on sale of
properties ($10,551,000) and loss on impairment of fixed assets ($2,710,000).

Total  expenses for the three and nine months ended  December 15, 2005 and 2004,
excluding   depreciation   and   amortization,    interest   and   general   and
administrative-related   parties,   totaled   $3,419,521   and   $3,052,177  and
$10,068,629 and $9,557,087, respectively.

Accounts payable as of December 15, 2005 and March 15, 2005, were $3,848,099 and
$2,436,882,  respectively. Accounts payable are short term liabilities which are
expected to be paid from operating cash flows,  working capital  balances at the
Local  Partnership   level,  Local  General  Partner  advances  and  in  certain
circumstances  advances  from the  Partnership.  Because the  provisions  of the
secondary  loans defer the payment of accrued  interest of the respective  Local
Partnerships,   the   Partnership   believes  it  (and  the   applicable   Local
Partnerships) has sufficient  liquidity and ability to generate cash and to meet
existing and known or reasonably  likely future cash  requirements over both the
short and long term.  Included in accounts  payable as of December  15, 2005 and
March 15,  2005 are  $1,400,059  and  $7,730 of  deferred  revenue  from  sales,
respectively.

Accrued  interest  payable  as of  December  15,  2005 and  March  15,  2005 was
$8,525,754 and $7,885,329, respectively. Accrued interest payable represents the
accrued  interest on all mortgage  loans,  which  include  primary and secondary
loans. Certain secondary loans have provisions such that interest is accrued but
not payable  until a future date.  The  Partnership  anticipates  the payment of
accrued  interest on the  secondary  loans  (which  make up the  majority of the
accrued  interest  payable  amount  and which have been  accumulating  since the
Partnership's  investment in the respective Local Partnership) will be made from
future refinancings or sales proceeds of the respective Local  Partnerships.  In
addition, each Local Partnership's mortgage notes are collateralized by the land
and  buildings of the  respective  Local  Partnership,  and are without  further
recourse to the Partnership.

Partnership  management  fees and  expense  reimbursements  owed to the  General
Partners  amounting to approximately  $7,990,000 and $7,846,000 were accrued and
unpaid as of December  15, 2005 and March 15,  2005,  respectively.  Without the
General   Partners'   continued  accrual  without  payment  of  the  partnership
management  fees,  the  Partnership  will  not  be in a  position  to  meet  its
obligations.  The General  Partners have allowed for the accrual without payment
of a portion of the  partnership  management fees but are under no obligation to
continue to do so.

A  working  capital  reserve  of  approximately  $4,821,000  remained  unused at
December 15, 2005.  On April 15, 2005, a  distribution  from sales  proceeds was
made to the Limited  Partners  of  approximately  $1,919,000  and to the General
Partner of approximately $19,000. Approximately $3,500,000 has been declared for
distributions  and is expected to be made during the fourth  quarter ended March
15, 2006.

The  Partnership  is not  expected  to have  access  to  additional  sources  of
financing.

Long-Term
---------

For a discussion of contingencies affecting certain Local Partnerships, see Note
5 to the financial  statements.  Since the maximum loss the Partnership would be
liable for is its net  investment  in the  respective  Local  Partnerships,  the
resolution of the existing  contingencies  is not  anticipated  to impact future
results of  operations,  liquidity  or financial  condition  in a material  way.
However,  the  Partnership's  loss of its investment in a Local  Partnership may
result  in  recapture  of tax  credits  if the  investment  is lost  before  the
expiration of the applicable compliance period.

Management is not aware of any trends or events,  commitments  or  uncertainties
which have not  otherwise  been  disclosed  that  will,  or are likely to impact
liquidity in a material way.  Management  believes the only impact would be from
laws  that  have not yet been  adopted.  The  portfolio  is  diversified  by the
location of the  properties  around the United States so that if one area of the
country is experiencing  downturns in the economy,  the remaining  properties in
the  Partnership's   portfolio  may  be  experiencing  upswings.   However,  the
geographic  diversification  of the portfolio may not protect  against a general
downturn in the national economy.

Critical Accounting Policies
----------------------------

In  preparing  the  consolidated  financial  statements,   management  has  made
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities at the date of the financial  statements and the reported amounts of
revenues and expenses during the reporting periods.  Actual results could differ
from those  estimates.  Set forth below is a summary of the accounting  policies
that  management  believes are critical to the  preparation of the  consolidated


                                       12
<PAGE>

financial  statements.  The summary should be read in conjunction  with the more
complete discussion of the Partnership accounting policies included in Note 2 to
the consolidated financial statements in the annual report on Form 10-K.

Property and Equipment
----------------------

Property and  equipment  to be held and used are carried at cost which  includes
the purchase price,  acquisition fees and expenses, and any other costs incurred
in acquiring the  properties.  The cost of property and equipment is depreciated
over their estimated useful lives using accelerated and  straight-line  methods.
Expenditures  for repairs and  maintenance  are charged to expense as  incurred;
major  renewals  and  betterments  are  capitalized.  At the time  property  and
equipment  are  retired  or  otherwise  disposed  of,  the cost and  accumulated
depreciation  are  eliminated  from  the  assets  and  accumulated  depreciation
accounts and the profit or loss on such disposition is reflected in earnings.

In  accordance  with  Statement  of  Financial  Accounting  Standards  No.  144,
"Accounting for the Impairment of Disposal of Long-Lived Assets", the results of
discontinued  operations  are reported as a separate  component of income before
extraordinary items on the Consolidated  Statements of Operations.  Discontinued
operations include the results of operations and any gain or loss recognized for
Local  Partnerships  that have been  disposed of or are held for sale. A gain or
loss  recognized  on the  disposal is  disclosed  in the notes to the  financial
statements.  Adjustments to amounts  previously  reported in operations that are
directly related to the disposal of a Local  Partnership are reclassified in the
current period as discontinued operations for comparability purposes. Assets and
liabilities  of a Local  Partnership  that are  classified  as held for sale are
presented separately in the asset and liability sections,  respectively,  of the
Consolidated Balance Sheets.

A loss on  impairment of assets is recorded when  management  estimates  amounts
recoverable   through  future   operations  and  sale  of  the  property  on  an
undiscounted basis are below depreciated cost. At that time property investments
themselves are reduced to estimated fair value  (generally using discounted cash
flows).

During the nine  months  ended  December  15,  2005,  the  Partnership  recorded
$2,710,000  as a loss on  impairment  of assets or reduction  to estimated  fair
value for two Local Partnerships.

At the time management  commits to a plan to dispose of assets,  said assets are
adjusted to the lower of carrying amount or fair value less costs to sell. These
assets  are  classified  as  property  and  equipment-held  for sale and are not
depreciated.  As of December 15, 2005 and March 15, 2005,  the  Partnership  has
recorded  property and equipment net of accumulated  depreciation of $11,872,222
and $11,193,351, respectively, as held for sale.

Revenue Recognition
-------------------

Rental income is earned  primarily under standard  residential  operating leases
and is typically  due the first day of each month,  but can vary by property due
to the terms of the tenant leases.  Rental income is recognized  when earned and
as rents become due and charged to tenants' accounts  receivable if not received
by the due  date.  Rental  payments  received  in  advance  of the due  date are
deferred until earned.  Rental  subsidies are recognized as rental income during
the month in which it is earned.

Other  revenues are  recorded  when earned and consist of the  following  items:
Interest  income  earned on cash and cash  equivalent  balances and cash held in
escrow balances,  income from forfeited security deposits, late charges, laundry
and vending income, and other rental related items.

Income Taxes
------------

The  Partnership  is not  required to provide  for, or pay,  any federal  income
taxes.  Net income or loss generated by the Partnership is passed through to the
partners and is required to be reported by them. The  Partnership may be subject
to state and local taxes in jurisdictions  in which it operates.  For income tax
purposes, the Partnership has a fiscal year ending December 31.

Results of Operations
---------------------

The results of operations  for the three and nine months ended December 15, 2005
and 2004, consisted primarily of the results of the Partnership's  investment in
the consolidated Local Partnerships.

Rental income  increased  approximately  1% and 2% for the three and nine months
ended  December  15,  2005 as  compared  to the  corresponding  periods in 2004,
primarily due to rental rate increases at the Local Partnerships.

Other income decreased approximately $191,000 for the nine months ended December
15, 2005 as compared to the  corresponding  period in 2004,  primarily  due to a
decrease in subsidiary  income being  received at one Local  Partnership in 2005
offset by an increase in interest  income at the  Partnership  level,  resulting
from higher cash balances during the year from increased sales activity.

General and  administrative-related  parties increased approximately $69,000 and
$127,000  for the three and nine months  ended  December 15, 2005 as compared to
the  corresponding  periods in 2004,  primarily  due to an  increase  in expense
reimbursements  offset by a decrease in  Partnership  management  fees resulting
from sold properties at the Partnership level.

Operating and other increased  approximately $223,000 and $178,000 for the three
and nine months ended December 15, 2005 as compared to the corresponding periods
in 2004,  primarily  due to  increased  gas  prices at two  Local  Partnerships,
increased  water and sewer  costs at a third  Local  Partnership  and  increased
electricity costs at a fourth Local Partnership.

Taxes  increased  approximately  $87,000 for the nine months ended  December 15,
2005 as  compared  to the  corresponding  period  in  2004,  primarily  due to a
reassessment of the property taxes at one Local Partnership in 2005.


                                       13
<PAGE>

Financial decreased  approximately  $299,000 and $606,000 for the three and nine
months ended December 15, 2005 as compared to the corresponding periods in 2004,
primarily due to the mortgage payoff in the prior year at one Local  Partnership
and an overaccrual in the prior year at a second Local Partnership.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

The  Partnership  has  mortgage  notes  that are  payable in  aggregate  monthly
installments  including  principal  and interest at rates varying from 1% to 12%
per annum.  The Partnership does not believe there is a material risk associated
with the  various  interest  rates  associated  with the  mortgage  notes as the
majority  of  the  Local  Partnership  mortgage  notes  have  fixed  rates.  The
Partnership currently discloses in Item 8, Note 3 to the financial statements in
the Partnership's  Annual Report on Form 10-K for the year ended March 15, 2005,
the fair value of the mortgage notes payable.

The Partnership does not have any other market risk sensitive instruments.

Item 4.  Controls and Procedures

(a) EVALUATION OF DISCLOSURE  CONTROLS AND PROCEDURES.  The Principal  Executive
Officer and Principal  Financial  Officer of Related Credit  Properties L.P. and
Liberty  Associates  III, L.P.,  the general  partners of the  Partnership,  has
evaluated  the  effectiveness  of  the  Partnership's  disclosure  controls  and
procedures (as such term is defined in Rules  13a-15(e) and 15d-15(e)  under the
Securities  Exchange Act of 1934, as amended  ("Exchange Act")) as of the end of
the period covered by this report.  Based on such  evaluation,  such officer has
concluded  that,  as of the end of such  period,  the  Partnership's  disclosure
controls and procedures are effective.

(b) INTERNAL CONTROL OVER FINANCIAL  REPORTING.  There have not been any changes
in the Partnership's internal control over financial reporting during the fiscal
quarter to which this  report  relates  that have  materially  affected,  or are
reasonably likely to materially affect, the Partnership's  internal control over
financial reporting.


                                       14
<PAGE>

                           PART II. OTHER INFORMATION


Item 1.  Legal Proceedings - None

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds - None

Item 3.  Defaults upon Senior Securities - None

Item 4.  Submission of Matters to a Vote of Security Holders - None

Item 5.  Other Information

         On November 8, 2005,  CharterMac  announced that Stuart J. Boesky would
         step down as Chief  Executive  Officer and trustee of  CharterMac,  the
         indirect  parent of RCC  Manager  LLC,  the  managing  member of Credit
         Properties  GP LLC  which is the  general  partner  of  Related  Credit
         Properties  L.P. (the  "Related  General  Partner").  Upon his stepping
         down,  which was  effective on November 15, 2005, he also resigned from
         his position as Executive Vice President of the general  partner of the
         Related  General  Partner.  Mr.  Boesky will stay on as a consultant to
         CharterMac for the next year in order to ensure a smooth transition.

Item 6.  Exhibits

         (31.1)  Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a)
         (32.1)  Certification  Pursuant to Rule 13a-14(b) or Rule 15d-14(b) and
                 Section 1350 of Title 18 of the  United  States Code (18 U.S.C.
                 1350)


                                       15
<PAGE>

                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                          LIBERTY TAX CREDIT PLUS L.P.
                          ----------------------------
                                  (Registrant)


                               By:RELATED CREDIT PROPERTIES L.P.,
                                  a General Partner


                                  By:Related Credit Properties Inc.,
                                     its General Partner


Date: January 17, 2006
      ----------------               By:/s/ Alan P. Hirmes
                                        ------------------
                                        Alan P. Hirmes,
                                        President and Chief Executive Officer
                                        (Principal Executive
                                         and Financial Officer)


Date: January 17, 2006
      ----------------               By:/s/ Glenn F. Hopps
                                        ------------------
                                        Glenn F. Hopps,
                                        Treasurer
                                        (Principal Accounting Officer)


                               By:LIBERTY ASSOCIATES III, L.P.,
                                  a General Partner


                                  By:Related Credit Properties L.P.,
                                     its General Partner


                                     By:   Related Credit Properties Inc.,
                                        its General Partner


Date: January 17, 2006
      ----------------                  By:/s/ Alan P. Hirmes
                                           ------------------
                                           Alan P. Hirmes,
                                           President and Chief Executive Officer
                                           (Principal Executive
                                            and Financial Officer)


Date: January 17, 2006
      ----------------                  By:/s/ Glenn F. Hopps
                                           ------------------
                                           Glenn F. Hopps,
                                           Treasurer
                                           (Principal Accounting Officer)

<PAGE>

                                                                    Exhibit 31.1


                         CERTIFICATION PURSUANT TO RULE
                           13a-14(a) OR RULE 15d-14(a)


I, Alan P. Hirmes,  Principal  Executive Officer and Principal Financial Officer
of Related Credit Properties L.P. and Liberty Associates III, L.P. (the "General
Partners"),  each of which is a general  partner of Liberty Tax Credit Plus L.P.
(the "Partnership"), certify that:

     1.  I have  reviewed  this  quarterly  report on Form  10-Q for the  period
         ending December 15, 2005 of the Partnership;

     2.  Based  on my  knowledge,  this  report  does  not  contain  any  untrue
         statement of a material fact or omit to state a material fact necessary
         to make the statements made, in light of the circumstances  under which
         such  statements  were made, not misleading  with respect to the period
         covered by this report;

     3.  Based on my knowledge,  the financial  statements,  and other financial
         information  included in this  report,  fairly  present in all material
         respects the financial condition,  results of operations and cash flows
         of the  Partnership  as of,  and for,  the  periods  presented  in this
         report;

     4.  I am responsible for establishing and maintaining  disclosure  controls
         and  procedures  (as  defined  in  Exchange  Act  Rules  13a-15(e)  and
         15d-15(e)) and internal control over financial reporting (as defined in
         Exchange Act Rules  13a-15(f) and  15d-15(f)) for the  Partnership  and
         have:

         a) designed such  disclosure  controls and  procedures,  or caused such
         disclosure controls and procedures to be designed under my supervision,
         to  ensure  that  material  information  relating  to the  Partnership,
         including its consolidated subsidiaries,  is made known to me by others
         within  those  entities,  particularly  during the period in which this
         report is being prepared;

         b) designed such internal control over financial  reporting,  or caused
         such internal control over financial  reporting to be designed under my
         supervision,  to provide reasonable assurance regarding the reliability
         of financial reporting and the preparation of financial  statements for
         external  purposes in accordance  with  generally  accepted  accounting
         principles;

         c) evaluated the effectiveness of the Partnership's disclosure controls
         and procedures  and presented in this report my  conclusions  about the
         effectiveness of the disclosure controls and procedures,  as of the end
         of the period covered by this report based on such evaluation; and

         d)  disclosed in this report any change in the  Partnership's  internal
         control over financial reporting that occurred during the Partnership's
         most  recent  fiscal  quarter  that  has  materially  affected,  or  is
         reasonably  likely to materially  affect,  the  Partnership's  internal
         control over financial reporting; and

     5.  I have  disclosed,  based  on my most  recent  evaluation  of  internal
         control over financial reporting,  to the Partnership's auditors and to
         the boards of directors of the General Partners:

         a) all significant  deficiencies and material  weaknesses in the design
         or operation of internal  control over  financial  reporting  which are
         reasonably  likely to  adversely  affect the  Partnership's  ability to
         record, process, summarize and report financial information; and

         b) any fraud,  whether or not  material,  that  involves  management or
         other  employees  who  have a  significant  role  in the  Partnership's
         internal control over financial reporting.



         Date: January 17, 2006
               ----------------
                                            By:  /s/ Alan P. Hirmes
                                                 ------------------
                                                 Alan P. Hirmes
                                                 Principal Executive Officer and
                                                 Principal Financial Officer

<PAGE>

                                                                    Exhibit 32.1


                            CERTIFICATION PURSUANT TO
                      RULE 13a-14(b) OR RULE 15d-14(b) AND
                                  SECTION 1350
                        OF TITLE 18 OF THE UNITED STATES
                             CODE ("18 U.S.C. 1350")


In  connection  with the  Quarterly  Report of Liberty Tax Credit Plus L.P. (the
"Partnership")  on Form 10-Q for the period  ending  December  15, 2005 as filed
with the  Securities  and  Exchange  Commission  ("SEC") on the date hereof (the
"Report"),  I,  Alan  P.  Hirmes,  Principal  Executive  Officer  and  Principal
Financial Officer of Related Credit Properties L.P. and Liberty  Associates III,
L.P., the general  partners of the Partnership,  certify,  pursuant to 18 U.S.C.
Section 1350, as adopted  pursuant to Section 906 of the  Sarbanes-Oxley  Act of
2002, that:


       (1) The Report fully complies with the  requirements  of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and


       (2) The  information  contained  in the Report  fairly  presents,  in all
material  respects,  the  financial  condition  and result of  operations of the
Partnership.

A signed  original of this  written  statement  required by Section 906 has been
provided  to the  Partnership  and  will  be  retained  by the  Partnership  and
furnished to the SEC or its staff upon request.



By:  /s/ Alan P. Hirmes
     ------------------
     Alan P. Hirmes
     Principal Executive Officer and Principal Financial Officer
     January 17, 2006