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


                             ----------------------


                                    FORM 10-Q

                             ----------------------




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

                For the quarterly period ended September 30, 1998

                                       OR

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

                    For the transition period from ___ to ___

                             ----------------------

                          Commission File No. 33-15551

                             ----------------------



                        POLARIS AIRCRAFT INCOME FUND IV,
                        a California Limited Partnership

                        State of Organization: California
                   IRS Employer Identification No. 94-3039169
                201 High Ridge Road, Stamford, Connecticut 06927
                           Telephone - (203) 357-3776



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,  and (2) has been  subject to such filing
requirements for the past 90 days.



                            Yes  X            No 
                                ---              ---






                       This document consists of 13 pages.


<PAGE>



                        POLARIS AIRCRAFT INCOME FUND IV,
                        A California Limited Partnership

          FORM 10-Q - For the Quarterly Period Ended September 30, 1998




                                      INDEX


Part I.       Financial Information                                         Page


         Item 1.      Financial Statements

              a)  Balance Sheets - September 30, 1998 and
                  December 31, 1997...........................................3

              b)  Statements of Operations - Three and Nine Months
                  Ended September 30, 1998 and 1997...........................4

              c)  Statements of Changes in Partners' Capital
                  (Deficit) - Year Ended December 31, 1997
                  and Nine Months Ended September 30, 1998....................5

              d)  Statements of Cash Flows - Nine Months
                  Ended September 30, 1998 and 1997...........................6

              e)  Notes to Financial Statements...............................7

         Item 2.      Management's Discussion and Analysis of
                      Financial Condition and Results of Operations...........8



Part II.      Other Information

         Item 1.      Legal Proceedings......................................11

         Item 6.      Exhibits and Reports on Form 8-K.......................11

         Signature    .......................................................12



                                       2
<PAGE>

                          Part I. Financial Information
                          -----------------------------

Item 1.  Financial Statements

                        POLARIS AIRCRAFT INCOME FUND IV,
                        A California Limited Partnership

                                 BALANCE SHEETS
                                   (Unaudited)

                                                    September 30,  December 31,
                                                        1998           1997
                                                        ----           ----
ASSETS:

CASH AND CASH EQUIVALENTS                           $  1,851,733   $ 34,023,841

OTHER RECEIVABLES                                            250           --
                                                    ------------   ------------
                                                    $  1,851,983   $ 34,023,841
                                                    ============   ============

LIABILITIES AND PARTNERS' CAPITAL (DEFICIT):

PAYABLE TO AFFILIATES                               $    206,891   $    190,967

ACCOUNTS PAYABLE AND ACCRUED
    LIABILITIES                                          309,373        325,984
                                                    ------------   ------------

        Total Liabilities                                516,264        516,951
                                                    ------------   ------------

PARTNERS' CAPITAL (DEFICIT):
   General Partner                                    (7,744,007)    (4,825,310)
   Limited Partners, 499,954 and 499,964 units
      outstanding in 1998 and 1997, respectively       9,079,726     38,332,200
                                                    ------------   ------------

        Total Partners' Capital                        1,335,719     33,506,890
                                                    ------------   ------------

                                                    $  1,851,983   $ 34,023,841
                                                    ============   ============

        The accompanying notes are an integral part of these statements.


                                       3
<PAGE>

                        POLARIS AIRCRAFT INCOME FUND IV,
                        A California Limited Partnership

                            STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>


                                          Three Months Ended        Nine Months Ended
                                             September 30,            September 30,
                                             -------------            -------------
                                           1998         1997        1998         1997
                                           ----         ----        ----         ----
<S>                                    <C>          <C>         <C>          <C> 

REVENUES:
   Rent from operating leases          $     --     $   94,889  $     --     $3,813,721
   Interest                                26,133      193,370     286,608      756,218
   Gain on sale of aircraft                  --        951,579        --        951,579
   Other                                     --        779,893        --        807,388
                                       ----------   ----------  ----------   ----------

           Total Revenues                  26,133    2,019,731     286,608    6,328,906
                                       ----------   ----------  ----------   ----------

EXPENSES:
   Depreciation and amortization             --          3,013        --      2,685,475
   Management fees to general partner        --           --          --        106,632
   Operating                               76,722       56,807     199,265      113,659
   Administration and other                57,421       84,269     249,548      277,562
                                       ----------   ----------  ----------   ----------

           Total Expenses                 134,143      144,089     448,813    3,183,328
                                       ----------   ----------  ----------   ----------

NET INCOME (LOSS)                      $ (108,010)  $1,875,642  $ (162,205)  $3,145,578
                                       ==========   ==========  ==========   ==========

NET INCOME ALLOCATED
   TO THE GENERAL PARTNER              $   24,792   $  885,108  $  282,120   $1,397,721
                                       ==========   ==========  ==========   ==========

NET INCOME (LOSS) ALLOCATED
   TOLIMITED PARTNERS                  $ (132,802)  $  990,534  $ (444,325)  $1,747,857
                                       ==========   ==========  ==========   ==========

NET INCOME (LOSS) PER
   LIMITED PARTNERSHIP UNIT            $    (0.27)  $     1.98  $    (0.89)  $     3.50
                                       ==========   ==========  ==========   ==========
</TABLE>


        The accompanying notes are an integral part of these statements.


                                       4
<PAGE>

                        POLARIS AIRCRAFT INCOME FUND IV,
                        A California Limited Partnership

              STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
                                   (Unaudited)


                                          Year Ended December 31, 1997 and
                                        Nine Months Ended September 30, 1998
                                        ------------------------------------

                                        General        Limited
                                        Partner       Partners         Total
                                        -------       --------         -----

Balance, December 31, 1996           $ (3,975,366)  $ 52,044,872   $ 48,069,506

   Net income                             979,368      2,751,143      3,730,511

   Cash distributions to partners      (1,829,312)   (16,463,815)   (18,293,127)
                                     ------------   ------------   ------------

Balance, December 31, 1997             (4,825,310)    38,332,200     33,506,890

   Net income (loss)                      282,120       (444,325)      (162,205)

   Capital redemptions (10 units)            --             (800)          (800)

   Cash distributions to partners      (3,200,817)   (28,807,349)   (32,008,166)
                                     ------------   ------------   ------------

Balance, September 30, 1998          $ (7,744,007)  $  9,079,726   $  1,335,719
                                     ============   ============   ============

        The accompanying notes are an integral part of these statements.


                                       5
<PAGE>

                        POLARIS AIRCRAFT INCOME FUND IV,
                        A California Limited Partnership

                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                                                 Nine Months Ended September 30,
                                                 -------------------------------
                                                       1998           1997
                                                       ----           ----
OPERATING ACTIVITIES:
      Net income (loss)                           $   (162,205)  $  3,145,578
      Adjustments to reconcile net income (loss)
        to net cash provided by operating
        activities:
        Depreciation and amortization                     --        2,685,475
        Gain on sale of aircraft                          --         (951,579)
        Changes in operating assets and
           liabilities:
           Decrease (increase) in rent and other
             receivables                                  (250)         3,219
           Increase (decrease) in payable to
             affiliates                                 15,924         (2,949)
           Decrease in accounts payable
              and accrued liabilities                  (16,611)       (88,016)
           Decrease in lessee security deposits           --       (1,124,529)
           Decrease in maintenance reserves               --       (5,408,614)
                                                  ------------   ------------

              Net cash used in operating
                activities                            (163,142)    (1,741,415)
                                                  ------------   ------------

INVESTING ACTIVITIES:
      Proceeds from sale of aircraft                      --        4,940,755
      Payments to Purchaser related to sale of
        aircraft                                          --       (1,792,380)
      Principal payments on notes receivable              --        7,851,494
                                                  ------------   ------------

              Net cash provided by investing
                activities                                --       10,999,869
                                                  ------------   ------------

FINANCING ACTIVITIES:
      Capital redemptions                                 (800)          --
      Cash distributions to partners               (32,008,166)   (15,182,240)
                                                  ------------   ------------

              Net cash used in financing
                activities                         (32,008,966)   (15,182,240)
                                                  ------------   ------------

CHANGES IN CASH AND CASH
      EQUIVALENTS                                  (32,172,108)    (5,923,786)

CASH AND CASH EQUIVALENTS AT
      BEGINNING OF PERIOD                           34,023,841     23,989,285
                                                  ------------   ------------

CASH AND CASH EQUIVALENTS AT
      END OF PERIOD                               $  1,851,733   $ 18,065,499
                                                  ============   ============

        The accompanying notes are an integral part of these statements.


                                       6
<PAGE>


                        POLARIS AIRCRAFT INCOME FUND IV,
                        A California Limited Partnership

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)


1.       Accounting Principles and Policies

In the opinion of management,  the financial statements presented herein include
all  adjustments,  consisting  only of  normal  recurring  items,  necessary  to
summarize fairly Polaris Aircraft Income Fund IV's (the Partnership's) financial
position and results of operations.  The financial statements have been prepared
in accordance with the  instructions  of the Quarterly  Report to the Securities
and  Exchange  Commission  (SEC)  Form  10-Q  and  do  not  include  all  of the
information  and note  disclosures  required by  generally  accepted  accounting
principles  (GAAP).  These  statements  should be read in  conjunction  with the
financial  statements  and notes thereto for the years ended  December 31, 1997,
1996,  and 1995 included in the  Partnership's  1997 Annual Report to the SEC on
Form 10-K.


2.       Related Parties

Under the Limited Partnership  Agreement,  the Partnership paid or agreed to pay
the following  amounts for the current quarter to the general  partner,  Polaris
Investment  Management  Corporation,  in connection  with  services  rendered or
payments made on behalf of the Partnership:

                                           Payments for the
                                          Three Months Ended      Payable at
                                          September 30, 1998  September 30, 1998
                                          ------------------  ------------------
Out-of-Pocket Administrative and Selling
     Expense Reimbursement                     $109,186           $ 36,772

Out-of-Pocket Operating and
     Remarketing Expense Reimbursement            5,302            170,119
                                               --------           --------

                                               $114,488           $206,891
                                               ========           ========

3.       Partners' Capital

The Partnership  Agreement (the Agreement) stipulates different methods by which
revenue,  income  and  loss  from  operations  and  gain or loss on the  sale of
aircraft are to be allocated  to the general  partner and the limited  partners.
Such  allocations are made using income or loss  calculated  under GAAP for book
purposes, which varies from income or loss calculated for tax purposes.

Cash  available  for  distributions,  including  the  proceeds  from the sale of
aircraft,  is  distributed  10% to the  general  partner  and 90% to the limited
partners.

The different methods of allocating items of income, loss and cash available for
distribution  combined with the calculation of items of income and loss for book
and  tax  purposes  result  in  book  basis  capital   accounts  that  may  vary
significantly  from tax basis capital  accounts.  The ultimate  liquidation  and
distribution  of remaining cash will be based on the tax basis capital  accounts
following liquidation, in accordance with the Agreement.


                                       7
<PAGE>


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

As discussed below under "Liquidity and Cash Distributions,"  Polaris Investment
Management  Corporation  (PIMC,  or the General  Partner),  is in the process of
winding up the business of Polaris  Aircraft  Income Fund IV (the  Partnership).
During 1997, the Partnership sold its remaining  portfolio of 13 used commercial
jet aircraft out of its original portfolio of 33 aircraft.


Partnership Operations

The  Partnership  recorded  a  net  loss  of  $108,010,  or  $0.27  per  limited
partnership unit for the three months ended September 30, 1998,  compared to net
income of $1,875,642, or $1.98 per limited partnership unit, for the same period
in 1997. The Partnership  recorded a net loss of $162,205,  or $0.89 per limited
partnership  unit for the nine months ended September 30, 1998,  compared to net
income of $3,145,578, or $3.50 per limited partnership unit, for the same period
in 1997.

The  decline  in  operating  results  during  the  three and nine  months  ended
September 30, 1998,  as compared to the same periods in 1997,  was primarily due
to the sale of the  Partnership's  remaining  aircraft in 1997. The  Partnership
recognized a gain on this sale of $951,579 during the third quarter of 1997. The
variance  in net  income  per  limited  partnership  unit will  differ  from the
variance  of total net income  from period to period due to the methods by which
income  or loss from  operations  and gain or loss on the sale of  aircraft  are
allocated in accordance with the partnership agreement.

The  Partnership  also recognized as other revenue in the third quarter of 1997,
excess maintenance  reserves  aggregating  $779,893 that were previously paid to
the  Partnership  by a former lessee for the aircraft that was sold to Triton in
1997.

Interest  income  decreased  during  the  three  months  and nine  months  ended
September 30, 1998, as compared to the same periods in 1997,  primarily due to a
decrease  in the  cash  reserves  in 1998.  The  decrease  in the cash  reserves
resulted from cash distributions, as discussed in the liquidity section. Another
factor  contributing  to the  decrease  in  interest  income was the  absence of
interest  income on the deferred rent payments due from  Continental  that ended
when the final payment was made in 1997.

Operating  expenses  increased  during the three and nine months ended September
30, 1998 as compared to the same periods in 1997,  primarily  due to an increase
in legal  expenses  related  to the sale of the  remaining  aircraft,  partially
offset by the elimination of expenses related to insuring and maintaining  those
aircraft.

Administrative  expenses  decreased  during  the  three  and nine  months  ended
September  30, 1998 as compared to the same periods in 1997,  primarily due to a
decrease in consulting expenses.


Liquidity and Cash Distributions

Liquidity - As previously discussed, the Partnership sold its remaining aircraft
during 1997. Polaris Investment Management Corporation, the general partner, has
determined that the  Partnership  maintain cash reserves as a prudent measure to
ensure  that  the  Partnership  has  available   sufficient   funds  to  satisfy
anticipated  contingencies  and  expenses  in  connection  with  winding  up its
business.  The Partnership's  cash reserves will be monitored and may be revised
from time to time as further information becomes available in the future.


                                       8
<PAGE>


Cash Distributions - There were no cash distributions to limited partners during
the three months ended September 30, 1998, compared to $8,664,376, or $17.33 per
limited partnership unit, during the three months ended September 30, 1997. Cash
distributions  to limited  partners  during the nine months ended  September 30,
1998 were  $28,807,349,  or $57.62 per  limited  partnership  unit,  compared to
$13,664,016,  or $27.33 per limited  partnership  unit for the nine months ended
September 30, 1997. The increase in  distributions  during the nine months ended
September  30,  1998,  as  compared  to the same  period in 1997,  is due to the
distribution  of the proceeds  received  from the  prepayment of a note due from
Triton Aviation  Services IV LLC on December 30, 1997. The Partnership is now in
the  process  of  winding  up its  business.  With  the  exception  of  reserves
maintained  for  anticipated  expenses and costs of winding up, the  Partnership
distributed all of its available cash during 1997 and the first quarter of 1998.
Consequently,  the timing and amount of future cash  distributions,  if any, are
not yet known and will depend upon whether the Partnership's reserves exceed its
actual  expenses  and  contingencies  in winding up and on the time  required to
complete the winding up process.


Impact of the Year 2000 Issue

The inability of business  processes to continue to function correctly after the
beginning of the Year 2000 could have serious  adverse  effects on companies and
entities  throughout  the world.  As previously  discussed,  the  Partnership is
currently in the process of winding up its business and has no assets other than
cash and cash  equivalent  securities  held as reserves  against the anticipated
expenses of winding up and dissolution.  Accordingly, the Partnership's exposure
to the Year 2000 problem  arises not in the context of its own  operations,  but
rather in the context of the compliance or non-compliance by third-party vendors
to the  Partnership  with their  respective Year 2000 assessment and remediation
obligations.

As discussed in prior filings with the Securities and Exchange  Commission,  the
General  Partner has engaged GE Capital  Aviation  Services,  Inc.  ("GECAS") to
provide certain management services to the Partnership. Both the General Partner
and GECAS are wholly-owned  subsidiaries  (either direct or indirect) of General
Electric Capital  Corporation  ("GECC").  All of the  Partnership's  operational
functions  are  handled  either  by the  General  Partner  and GECAS or by third
parties (as discussed in the following  paragraphs),  and the Partnership has no
information systems of its own.

GECC and GECAS have  undertaken a global  effort to identify  and mitigate  Year
2000 issues in their information systems, products and services,  facilities and
suppliers  as well as to assess the extent to which Year 2000 issues will impact
their  customers.   Each  business  has  a  Year  2000  leader  who  oversees  a
multi-functional  remediation  project team responsible for applying a Six Sigma
quality approach in four phases:  (1)  define/measure  -- identify and inventory
possible  sources of Year 2000 issues;  (2) analyze -- determine  the nature and
extent of Year 2000 issues and develop  project  plans to address  those issues;
(3) improve -- execute project plans and perform a majority of the testing;  and
(4) control -- complete  testing,  continue  monitoring  readiness  and complete
necessary  contingency  plans. The progress of this program is monitored at each
business, and company-wide reviews with senior management are conducted monthly.
GECC and GECAS  management  plan to have completed the first three phases of the
program for a  substantial  majority of  mission-critical  systems by the end of
1998 and to have  nearly  all  significant  information  systems,  products  and
services,  facilities  and  suppliers  in the  control  phase of the  program by
mid-1999.

Due to the limited nature of the Partnership's operations,  the only third-party
vendors to the Partnership  are those  providing the  Partnership  with services


                                       9
<PAGE>

such as accounting,  auditing,  banking and investor services.  GECAS intends to
apply  the same  standards  in  determining  the Year 2000  capabilities  of the
Partnership's  third-party  vendors  as GECAS  will  apply  with  respect to its
outside vendors pursuant to its internal Year 2000 program.

The  scope  of the  global  Year  2000  effort  encompasses  many  thousands  of
applications  and computer  programs;  products  and  services;  facilities  and
facilities-related  equipment;  suppliers; and, customers. The Partnership, like
all  business  operations,  is also  dependent  on the Year  2000  readiness  of
infrastructure   suppliers   in   areas   such   as   utility,   communications,
transportation  and other services.  In this  environment,  there will likely be
instances of failure that could cause  disruption in business  processes or that
could affect vendors'  ability to provide  services  without  interruption.  The
likelihood  and effects of failures in  infrastructure  systems,  over which the
Partnership has no control, cannot be estimated.  However, aside from the impact
of any such  possible  failures,  the  General  Partner  does not  believe  that
occurrences  of Year 2000  failures will have a material  adverse  effect on the
financial position, results of operations or liquidity of the Partnership.

To date, the Partnership has not incurred any Year 2000 expenditures nor does it
expect  to incur any  material  costs in the  future.  However,  the  activities
involved in the Year 2000 effort  necessarily  involve estimates and projections
of activities and resources that will be required in the future. These estimates
and projections could change as work progresses.



                                       10
<PAGE>


                           Part II. Other Information
                           --------------------------


Item 1.    Legal Proceedings

As  discussed  in Item 3 of Part I of  Polaris  Aircraft  Income  Fund IV's (the
Partnership) 1997 Annual Report to the Securities and Exchange  Commission (SEC)
on Form 10-K (Form 10-K) and in Item 1 of Part II of the Partnership's Quarterly
Report to the SEC on Form 10-Q (Form 10-Q) for the periods  ended March 31, 1998
and June 30, 1998,  there are a number of pending legal  actions or  proceedings
involving  the  Partnership.  Except  as  described  below,  there  have been no
material developments with respect to any such actions or proceedings during the
period covered by this report.

Ron Wallace v. Polaris Investment Management  Corporation,  et al. - On November
9, 1998,  defendants,  acting through their  counsel,  entered into a settlement
agreement  with   plaintiffs  and  with  the  plaintiff  in  a  related  action,
Accelerated High Yield Income Fund v. Polaris Investment Management Corporation,
et al. The settlement is subject to final approval by the Court.  The settlement
agreement  does not  provide  for any  payments  to be made to the  Partnership.
Plaintiff's  counsel is seeking  reimbursement from the Partnership of an as yet
to be determined amount of fees and expenses.  A settlement notice setting forth
the terms of the  settlement  will be mailed to the last  known  address of each
unitholder of the  Partnership  by November 20, 1998. On November 10, 1998,  the
Court preliminarily approved the settlement.  A hearing to determine whether the
settlement should be finally approved by the Court is scheduled for December 22,
1998.

Other Proceedings - Item 10 in Part III of the Partnership's  1997 Form 10-K and
Item 1 in Part II of the Partnership's Form 10-Q for the periods ended March 31,
1998 and June 30, 1998 discuss  certain  actions  which have been filed  against
Polaris Investment Management Corporation and others in connection with the sale
of interests in the  Partnership  and the  management  of the  Partnership.  The
Partnership  is not a party  to  these  actions.  There  have  been no  material
developments  with respect to any of the actions  described  therein  during the
period covered by this report.


Item 6.    Exhibits and Reports on Form 8-K

a)      Exhibits (numbered in accordance with Item 601 of Regulation S-K)

        27. Financial Data Schedule (in electronic format only).

b)      Reports on Form 8-K

        No reports on Form 8-K were filed by the  Registrant  during the quarter
        for which this report is filed.


                                       11
<PAGE>


                                    SIGNATURE



Pursuant to the  requirements of section 13 or 15(d) 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.

                                  POLARIS AIRCRAFT INCOME FUND IV,
                                  A California Limited Partnership
                                  (Registrant)
                                  By:  Polaris Investment
                                       Management Corporation,
                                       General Partner





        November 16, 1998              By:   /S/Marc A. Meiches
----------------------------------           ------------------
                                             Marc A. Meiches
                                             Chief Financial Officer
                                             (principal financial officer and
                                             principal accounting officer of
                                             Polaris Investment Management
                                             Corporation, General Partner of
                                             the Registrant)

                                       12