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


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



                                    FORM 10-Q


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



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

                  For the quarterly period ended June 30, 2008


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



                         Commission file number 0-13523

                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP
             Organized pursuant to the Laws of the State of Maryland


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



        Internal Revenue Service - Employer Identification No. 52-1328767

                 11200 Rockville Pike, Rockville, Maryland 20852

                                 (301) 468-9200


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



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 a large  accelerated  filer, an
accelerated filer, or a non-accelerated filer.

Large accelerated filer |_|  Accelerated filer |_|  Non-accelerated filer |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>


                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                               INDEX TO FORM 10-Q

                       FOR THE QUARTER ENDED JUNE 30, 2008





                                                                           Page

Part I - FINANCIAL INFORMATION

Item 1.  Financial Statements

         Consolidated Balance Sheets
           - June 30, 2008 and December 31, 2007............................  1

         Consolidated Statements of Operations and Accumulated Losses
           - for the three and six months ended June 30, 2008 and 2007......  2

         Consolidated Statements of Cash Flows
           - for the six months ended June 30, 2008 and 2007................  3

         Notes to Consolidated Financial Statements
           - June 30, 2008 and 2007.........................................  4

Item 2.  Management's Discussion and Analysis of Financial Condition
           and Results of Operations........................................ 14

Item 4.  Controls and Procedures............................................ 18


PART II - OTHER INFORMATION

Item 3.  Defaults Upon Senior Securities.................................... 18

Item 5.  Other Information.................................................. 19

Item 6.  Exhibits........................................................... 19

Signature................................................................... 20



<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements


                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                           CONSOLIDATED BALANCE SHEETS


                                     ASSETS

<TABLE>
<CAPTION>
                                                                                        June 30,      December 31,
                                                                                          2008            2007
                                                                                      ------------    ------------
                                                                                       (Unaudited)
<S>                                                                                   <C>             <C>
Investments in partnerships .......................................................   $  5,834,585    $  5,709,149
Investment in partnerships held for sale or transfer ..............................        101,198          93,459
Cash and cash equivalents .........................................................      8,158,590       8,046,599
Acquisition fees, principally paid to related parties,
  net of accumulated amortization of $101,358 and $101,561, respectively ..........         69,896          73,928
Property purchase costs,
  net of accumulated amortization of $91,494 and $97,084, respectively ............         55,670          63,580
Other assets ......................................................................         16,425          32,230
                                                                                      ------------    ------------

      Total assets ................................................................   $ 14,236,364    $ 14,018,945
                                                                                      ============    ============



                        LIABILITIES AND PARTNERS' DEFICIT


Due on investments in partnerships ................................................   $  9,317,081    $  9,317,081
Accrued interest payable ..........................................................     43,662,679      42,594,387
Accounts payable and accrued expenses .............................................        136,989         192,387
                                                                                      ------------    ------------

      Total liabilities ...........................................................     53,116,749      52,103,855
                                                                                      ------------    ------------

Commitments and contingencies

Partners' deficit:

  Capital paid in:
    General Partners ..............................................................          2,000           2,000
    Limited Partners ..............................................................     73,501,500      73,501,500
                                                                                      ------------    ------------

                                                                                        73,503,500      73,503,500

  Less:
    Accumulated distributions to partners .........................................    (19,161,217)    (19,161,217)
    Offering costs ................................................................     (7,562,894)     (7,562,894)
    Accumulated losses ............................................................    (85,659,774)    (84,864,299)
                                                                                      ------------    ------------

      Total partners' deficit .....................................................    (38,880,385)    (38,084,910)
                                                                                      ------------    ------------

      Total liabilities and partners' deficit .....................................   $ 14,236,364    $ 14,018,945
                                                                                      ============    ============
</TABLE>


                   The accompanying notes are an integral part
                   of these consolidated financial statements.

                                       -1-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements


                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                             AND ACCUMULATED LOSSES

                                   (Unaudited)

<TABLE>
<CAPTION>
                                            For the three months ended      For the six months ended
                                                     June 30,                        June 30,
                                          -----------------------------   ----------------------------
                                               2008           2007             2008           2007
                                          -------------   -------------   ------------    ------------
<S>                                       <C>             <C>             <C>             <C>
Share of income from partnerships .....   $    544,148    $    247,174    $    613,119    $    286,996
                                          ------------    ------------    ------------    ------------

Other revenue and  expenses:

  Revenue:
    Interest ..........................         54,821         102,161         132,659         204,272
    Gain from extinguishment of debt ..           --        17,498,567            --        17,498,567
                                          ------------    ------------    ------------    ------------

                                                54,821      17,600,728         132,659      17,702,839
                                          ------------    ------------    ------------    ------------

  Expenses:
    Interest ..........................        190,424       1,245,082       1,068,292       2,507,389
    Management fee ....................         93,750          93,750         187,500         187,500
    General and administrative ........         82,045          79,561         176,423         170,069
    Professional fees .................         53,668          45,812         104,835          92,125
    Amortization of deferred costs ....          2,101          13,813           4,203          15,464
                                          ------------    ------------    ------------    ------------

                                               421,988       1,478,018       1,541,253       2,972,547
                                          ------------    ------------    ------------    ------------

      Total other revenue and expenses        (367,167)     16,122,710      (1,408,594)     14,730,292
                                          ------------    ------------    ------------    ------------

Net income (loss) .....................        176,981      16,369,884        (795,475)     15,017,288

Accumulated losses, beginning of period    (85,836,755)    (99,747,102)    (84,864,299)    (98,394,506)
                                          ------------    ------------    ------------    ------------

Accumulated losses, end of period .....   $(85,659,774)   $(83,377,218)   $(85,659,774)   $(83,377,218)
                                          ============    ============    ============    ============


Net income (loss) allocated
  to General Partners (1.51%) .........   $      2,672    $    247,185    $    (12,012)   $    226,761
                                          ============    ============    ============    ============

Net income (loss) allocated
  to Initial and Special
  Limited Partners (1.49%) ............   $      2,637    $    243,911    $    (11,852)   $    223,758
                                          ============    ============    ============    ============

Net income (loss) allocated
  to Additional Limited Partners (97%)    $    171,672    $ 15,878,788    $   (771,611)   $ 14,566,769
                                          ============    ============    ============    ============

Net income (loss) per unit of
  Additional Limited Partner Interest,
    based on 73,337 units outstanding .   $       2.34    $     216.52    $     (10.52)   $     198.63
                                          ============    ============    ============    ============

</TABLE>
                   The accompanying notes are an integral part
                   of these consolidated financial statements.

                                       -2-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements


                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                               For the six months ended
                                                                                       June 30,
                                                                             ----------------------------
                                                                                 2008            2007
                                                                             ------------    ------------
<S>                                                                          <C>             <C>
Cash flows from operating activities:
  Net (loss) income ......................................................   $   (795,475)   $ 15,017,288

  Adjustments to reconcile net (loss) income to net cash used in operating
    activities:
    Share of income from partnerships ....................................       (613,119)       (286,996)
    Gain from extinguishment of debt .....................................           --       (17,498,567)
    Amortization of deferred costs .......................................          4,203          15,464

    Changes in assets and liabilities:
      Decrease in other assets ...........................................         15,805           2,693
      Increase in accrued interest payable ...............................      1,068,292       2,507,389
      Decrease in accounts payable and accrued expenses ..................        (55,398)        (59,219)
                                                                             ------------    ------------

        Net cash used in operating activities ............................       (375,692)       (301,948)
                                                                             ------------    ------------

Cash flows from investing activities:
  Receipt of distributions from partnerships .............................        487,683         104,014
  Collection of sale proceeds receivable .................................           --            27,235
                                                                             ------------    ------------

        Net cash provided by investing activities ........................        487,683         131,249
                                                                             ------------    ------------

Net increase (decrease) in cash and cash equivalents .....................        111,991        (170,699)

Cash and cash equivalents, beginning of period ...........................      8,046,599       8,079,400
                                                                             ------------    ------------

Cash and cash equivalents, end of period .................................   $  8,158,590    $  7,908,701
                                                                             ============    ============
</TABLE>


                   The accompanying notes are an integral part
                   of these consolidated financial statements.

                                       -3-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


1.   BASIS OF PRESENTATION

     In the opinion of C.R.I.,  Inc. (CRI), the Managing  General  Partner,  the
accompanying   unaudited   consolidated   financial   statements   reflect   all
adjustments,  consisting  of normal  recurring  accruals,  necessary  for a fair
presentation of the financial  position of Capital Realty  Investors-IV  Limited
Partnership  (the  Partnership)  as of June 30,  2008,  and the  results  of its
operations for the three and six month periods ended June 30, 2008 and 2007, and
its cash  flows for the six month  periods  ended  June 30,  2008 and 2007.  The
results of  operations  for the interim  periods  ended June 30,  2008,  are not
necessarily indicative of the results to be expected for the full year.

     The  accompanying  unaudited  consolidated  financial  statements have been
prepared in conformity  with  accounting  principles  generally  accepted in the
United  States of  America  (US GAAP) and with the  instructions  to Form  10-Q.
Certain  information and accounting policies and footnote  disclosures  normally
included in financial  statements  prepared in conformity with US GAAP have been
condensed or omitted pursuant to such instructions. These condensed consolidated
financial  statements  should  be  read in  conjunction  with  the  consolidated
financial  statements  and notes thereto  included in the  Partnership's  annual
report on Form 10-KSB at December 31, 2007.


2.   INVESTMENTS IN PARTNERSHIPS

a.   Due on investments in partnerships and accrued interest payable
     ---------------------------------------------------------------

                              Purchase money notes
                              --------------------

     The  Partnership's  obligations  with respect to its  investments  in Local
Partnerships,  in the  form  of  nonrecourse  purchase  money  notes  having  an
aggregate  principal  balance of $9,317,081 plus aggregate  accrued  interest of
$43,662,679  as of June 30, 2008,  are payable in full upon the earliest of: (i)
sale or refinancing of the respective Local Partnership's rental property;  (ii)
payment in full of the respective Local  Partnership's  permanent loan; or (iii)
maturity.

     The  collateral  that  secured  the  purchase  money  notes  related to the
following properties were sold to the noteholders during 2007.

<TABLE>
<CAPTION>

     Property                           Principal             Date        Disposition
     --------                          -----------         ---------      -----------
     <S>                               <C>                 <C>            <C>
     Crescent Gardens - Second Note    $  434,000          June 2007         Sale
     Jewish Federation                  1,350,000          June 2007         Sale

</TABLE>


     The purchase money notes related to the following  properties  have matured
and have not been paid or extended as of August 13, 2008.

<TABLE>
<CAPTION>
                                                           Accrued Interest
                                                                As of
     Property                            Principal          June 30, 2008      Maturity
     --------                           -----------        ---------------    -----------
     <S>                                <C>                <C>                <C>
     Westport Village (1)               $  840,000             $2,642,925       09/01/99
     Pilgrim Tower East                  1,450,000 (2)          4,583,413       11/30/03
     Cedar Point                         1,320,000              3,816,608       08/30/04
     Thornwood House                     1,775,000              4,949,846       08/30/04

</TABLE>
                                       -4-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


2.   INVESTMENTS IN PARTNERSHIPS - Continued

     (1)  In receivership.
     (2)  Remaining principal, after partial payment.

     The  purchase  money note secured by the  Partnership's  interest in Asbury
Tower Associates Limited  Partnership (Asbury Tower) was due to mature on August
31, 2004. However, the noteholder orally agreed to extend the maturity date on a
month to month basis until such time as the noteholder provides a 30 day advance
notice to the  Partnership.  Effective  January  1, 2008 the  interest  rate was
reduced to 4 percent. As of June 30, 2008, principal and accrued interest due on
the purchase money note were $3,432,081 and $24,615,606, respectively. The Local
Managing General Partner is currently negotiating the sale of the property owned
by Asbury Towers to an affiliate.  Proceeds from the sale will be used to payoff
the purchase  money note at a discount.  There is no assurance  that the sale of
the property will occur.

     Due to the  impending  sale of the  property  owned by  Asbury  Tower,  the
Partnership's  basis in the Local  Partnership,  along with the net  unamortized
amount of acquisition fees and property purchase costs, which totaled $53,727 at
both June 30, 2008 and December 31, 2007,  have been  reclassified to investment
in  partnerships  held for sale or  transfer  in the  accompanying  consolidated
balance sheets.

     The remaining  purchase  money note related to  Northridge  Park matures in
2025. As of June 30, 2008, principal and accrued interest balances were $500,000
and $3,054,281, respectively.

     As of June 30, 2008, Westport Village is in receivership. The Partnership's
non-recourse  purchase  money notes and accrued  interest  totaled  $840,000 and
$2,642,925,  respectively at June 30, 2008. The Partnership is not  anticipating
any loss resulting from the anticipated change in ownership upon foreclosure.

     The purchase money notes,  which are  nonrecourse to the  Partnership,  are
generally  secured  by  the  Partnership's  interest  in  the  respective  Local
Partnerships.  There is no assurance  that the underlying  properties  will have
sufficient appreciation and equity to enable the Partnership to pay the purchase
money notes'  principal and accrued  interest when due. If a purchase money note
is not paid in accordance with its terms,  the  Partnership  will either have to
renegotiate  the terms of repayment or risk losing its  partnership  interest in
the  respective  Local  Partnership.  In the event  that a  purchase  money note
remains unpaid upon maturity,  the noteholder may have the right to foreclose on
the Partnership's interest in the related Local Partnership.

     The  Partnership's  inability  to pay  certain of the  purchase  money note
principal and accrued interest balances when due, and the resulting  uncertainty
regarding the Partnership's  continued  ownership  interest in the related Local
Partnerships,  does not adversely impact the Partnership's  financial  condition
because the  purchase  money  notes are  nonrecourse  and secured  solely by the
Partnership's interest in the related Local Partnerships.  Therefore, should the
investment in any of the Local  Partnerships  with matured or maturing  purchase
money notes not produce  sufficient  value to satisfy the related purchase money
notes, the  Partnership's  exposure to loss is limited because the amount of the
nonrecourse indebtedness of each of the matured or maturing purchase money notes
exceeds the  carrying  amount of the  investment  in each of the  related  Local
Partnerships.  Thus, even a complete loss of the Partnership's interest in these
Local  Partnerships  would not have a material  adverse  impact on the financial
condition of the Partnership.

                                       -5-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


2.   INVESTMENTS IN PARTNERSHIPS - Continued

     The Managing General Partner continues to investigate possible alternatives
to reduce the Partnership's debt obligations.  These alternatives include, among
others, retaining the cash available for distribution to meet the purchase money
note  requirements,  paying off certain  purchase  money  notes at a  discounted
price, extending the due dates of certain purchase money notes,  refinancing the
respective  properties'  underlying  debt, or selling the underlying real estate
and using the  Partnership's  share of the  proceeds to pay or buy down  certain
purchase money note  obligations.  Although the Managing General Partner has had
some success applying these strategies in the past, the Managing General Partner
cannot assure that these  strategies  will be  successful in the future.  If the
Managing  General  Partner is unable to negotiate  an  extension  or  discounted
payoff,  in the event that the purchase money notes remain unpaid upon maturity,
the noteholders may have the right to foreclose on the Partnership's interest in
the related Local Partnerships.  In the event of a foreclosure or other transfer
of the Partnership's  interest, the excess of the nonrecourse  indebtedness over
the  carrying  amount  of the  Partnership's  investment  in the  related  Local
Partnership  will result in a taxable gain. This gain will be taxable to Limited
Partners at a federal  tax rate of up to 35.0%.  Additionally,  the  Partnership
would lose its investment in the Local Partnership and,  likewise,  its share of
any future cash  distributed by the Local  Partnership  from rental  operations,
mortgage  debt  refinancings,  or sale of the real  estate.  Of the eleven Local
Partnerships  in which the Partnership is invested as of June 30, 2008, the four
Local Partnerships with associated  purchase money notes which have matured,  or
which mature  through June 30, 2009, and which remain unpaid or unextended as of
August 13, 2008,  represented  the following  percentages  of the  Partnership's
total  distributions  received from Local  Partnerships and share of income from
Local Partnerships for the immediately preceding two calendar years.

                              Percentage of Total        Partnership's Share of
                             Distributions Received            Loss from
     For the Year Ending     from Local Partnerships       Local Partnerships
     -------------------     -----------------------     ----------------------

     December 31, 2007                  0%                    $ 69,448
     December 31, 2006                  0%                    $539,623


     The  Managing  General  Partner  continues  to  address  the  maturity  and
impending  maturity of the Partnership's  debt obligations and to seek solutions
that will provide the most favorable outcome to the Limited  Partners.  However,
there can be no assurance that these strategies will be successful.

     Interest  expense on the  Partnership's  purchase money notes for the three
and six  month  periods  ended  June 30,  2008,  was  $190,424  and  $1,068,292,
respectively,  and $1,245,082 and $2,507,389 for the three and six month periods
ended June 30, 2007, respectively.  The accrued interest payable on the purchase
money notes of $43,662,679  and $42,594,387 as of June 30, 2008 and December 31,
2007, respectively,  is due upon the earliest of: (i) sale or refinancing of the
respective  Local  Partnership's  rental  property;  (ii) payment in full of the
respective Local Partnership's permanent loan; or (iii) maturity.

                                   Cedar Point
                                   -----------

     The  Partnership  defaulted  on its  purchase  money  note  secured  by its
interest in Southwest Development Company (Cedar Point) on August 30, 2004, when
the note matured and was not paid.  The default  amount  included  principal and
accrued  interest of $1,320,000 and $3,122,592,  respectively.  As of August 13,


                                       -6-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


2.   INVESTMENTS IN PARTNERSHIPS - Continued

2008, principal and accrued interest of $1,320,000 and $3,837,874, respectively,
were due.  The  Partnership  had agreed in  principle  to assign its interest in
Cedar Point to the noteholders in satisfaction  of the nonrecourse  note.  There
has been no communication with the noteholders since 2006. Therefore,  effective
December 31, 2007, the Partnership's basis in Cedar Point, along with associated
acquisition  fees and property  purchase  costs which had been  reclassified  to
investment in  partnership's  held for sale or transfer,  were returned to their
respective operating accounts.

                                 DeAngelis Manor
                                 ---------------

     On March 19,  2002,  DeAngelis  Manor was sold.  Proceeds  received  by the
Partnership  from the sale of the property  were used to pay off, at a discount,
the remaining  purchase money note related to DeAngelis Manor,  although,  as of
August  13,  2008,  the note has not been  canceled  pending  final  receipt  of
accumulated cash from the property's  previous operations and payment thereof to
the purchase money noteholder.  The final  cancellation of the note will have no
financial impact to the Partnership.

                               Pilgrim Tower East
                               ------------------

     The  Partnership  defaulted  on its  purchase  money  note  secured  by its
interest in Pilgrim Tower East  Associates  (Pilgrim  Tower East) on December 1,
1999,  when the note  matured  and was not paid.  The  default  amount  included
principal and accrued interest of $1,650,000 and $2,719,372, respectively. As of
August 13, 2008,  principal and accrued  interest of $1,450,000 and  $4,609,178,
respectively, were due. The Partnership and the noteholders signed a contract to
sell the  Partnership's  interest  in Pilgrim  Tower East to the  noteholder  in
exchange  for the  outstanding  principal  and accrued  interest on the purchase
money note and two $100,000  payments on the purchase  money note,  one of which
was paid in  February  2002,  and one of which  was paid in  January  2003.  The
noteholders failed to obtain required  regulatory consent to the sale within the
required time frame and the contract for the sale of the Partnership's  interest
expired in November  2003.  Under the terms of the note and the  Assignment  and
Security  Agreement,  the  noteholders  have the right to enforce  its  security
interests in the Local  Partnership  subject to approval by  California  Housing
Finance  Agency and all other  government  agencies with  jurisdiction  over the
property.  The Partnership  has been informed by the  noteholders  that they are
working  to obtain  regulatory  consent  to the  transfer  of the  Partnership's
interest in 2008.  There is no  assurance  that a transfer of the  Partnership's
interest in Pilgrim Tower East will occur.

     Due to the  impending  transfer  of the  Partnership's  interest in Pilgrim
Tower East, the Partnership's basis in the Local Partnership, along with the net
unamortized  amount of  acquisition  fees and  property  purchase  costs,  which
totaled  $39,732  at both  June  30,  2008  and  December  31,  2007,  has  been
reclassified  to  investment  in  partnerships  held for sale or transfer in the
accompanying consolidated balance sheets.

                                       -7-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


2.   INVESTMENTS IN PARTNERSHIPS - Continued

                                 Thornwood House
                                 ---------------

     The  Partnership  defaulted  on its  purchase  money  note  secured  by its
interest in Thornwood  House  Associates  (Thornwood  House) on August 30, 2004,
when the note matured and was not paid.  The default amount  included  principal
and accrued  interest of $1,775,000 and $4,025,568,  respectively.  As of August
13,  2008,   principal  and  accrued  interest  of  $1,775,000  and  $4,978,167,
respectively,  were due. The  Partnership  had agreed in principle to assign its
interest to the noteholder in satisfaction of the  nonrecourse  note.  There has
been no  communication  with the noteholders  since 2006.  Therefore,  effective
December 31,  2007,  the  Partnership's  basis in  Thornwood  House,  along with
associated   acquisition  fees  and  property  purchase  costs  which  had  been
reclassified  to  investment  in  partnerships  held for sale or transfer,  were
returned to their respective operating accounts.

                                Westport Village
                                ----------------

     The  Partnership  defaulted  on its  purchase  money  notes  secured by its
interest in Westport  Village on September 1, 1999,  when the notes  matured and
were not paid. The default  amount  included  principal and accrued  interest of
$840,000 and  $1,615,644,  respectively.  As of August 13, 2008,  principal  and
accrued  interest  of  $840,000  and  $2,656,591,  respectively,  were due.  The
Partnership  was sued by the noteholders but there has not been any legal action
since 2000. The Partnership and the noteholders had agreed in principle that the
Partnership  would deposit  assignments of its interests in Westport  Village in
escrow,  together  with an option  agreement  pursuant to which the  noteholders
could purchase the interests for the  outstanding  debt if the property were not
sold  and/or the notes were not  repaid by  January 8, 2001.  At that time,  the
Partnership's  basis in the Local  Partnership,  along with the net  unamortized
amount of acquisition fees and property  purchase costs,  which totaled $46,989,
was reclassified to investment in partnerships  held in escrow.  However,  there
has been no response from the noteholders concerning implementing the settlement
since 2000.  Therefore,  effective  December 31, 2003, the acquisition  fees and
property   purchase  costs  which  had  been   reclassified   to  investment  in
partnerships held in escrow were returned to their respective accounts.

     The  loan  encumbering  the  property  associated  with  the  Partnership's
investment in Westport  Village is in default.  The Managing  General Partner of
the Local Partnership was unable to reach an agreement with the Illinois Housing
Development Authority (IHDA) to a mortgage  restructuring.  As of June 30, 2008,
Westport Village is in receivership.  The Partnership is working with IHDA for a
sale of the  property in lieu of  foreclosure.  The  Partnership's  non-recourse
purchase money notes and accrued interest thereon total $840,000 and $2,642,925,
respectively, at June 30, 2008 relating to this property. The Partnership is not
anticipating any loss resulting from the change in ownership.

                                       -8-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


2.   INVESTMENTS IN PARTNERSHIPS - Continued

     As Westport  Village is in  receivership,  the  Partnership's  basis in the
Local Partnership, along with the net unamortized amount of acquisition fees and
property  purchased  costs,  which totaled $0 at both June 30, 2008 and December
31, 2007, has been  reclassified to investment in partnerships  held for sale or
transfer in the accompanying consolidated balance sheets.

b.   Completed sales
     ---------------

                                Crescent Gardens
                                ----------------

     The  Partnership  defaulted on its two purchase  money notes secured by its
interest in Crescent  Gardens  Associates  (Crescent  Gardens) on July 31, 1999,
when the notes matured and were not paid. The default amount included  aggregate
principal and accrued  interest of $868,000 and  $2,033,388,  respectively.  The
Partnership  successfully negotiated an agreement to extend the maturity date of
one of the purchase money notes (First Crescent Note) in the original  principal
amount of  $434,000,  effective  October 15,  1999.  Pursuant  to the  extension
agreement, the Partnership made payments to the noteholder to be applied against
accrued but unpaid  interest.  The agreement  extended the maturity date to July
31, 2004,  subject to semi-annual  interest  payments,  and reduced the interest
rate of the First Crescent Note. The  Partnership  did not make the  semi-annual
interest   payment  due  in  January  2004.  In  June  2005,   one-half  of  the
Partnership's  limited partner interest in the Local Partnership was transferred
to a designee  of its  current  noteholder  in  satisfaction  of that note.  The
transfer of one-half of the Partnership's  interest in Crescent Gardens resulted
in gain  from  extinguishment  of  debt  for  financial  statement  purposes  of
$1,348,879 in 2005,  and in total gain of $1,840,362 for federal tax purposes in
2005. On June 7, 2007, the remaining half of the  Partnership's  Limited Partner
interest in the Local Partnership was sold,  subject to the right of the holders
of the Second  Crescent  Note.  As of June 7, 2007,  the  principal  and accrued
interest balances were $434,000 and $1,687,481,  respectively. The sale resulted
in gain  from  extinguishment  of  debt  for  financial  statement  purposes  of
$2,114,046 in 2007 and $2,881,618 for federal tax purposes.

                                Jewish Federation
                                -----------------

     The  Partnership  defaulted  on its  purchase  money  note  secured  by its
interest in Jewish  Federation  Apartments  Associates  (Jewish  Federation)  on
October 31,  2004,  when the note matured and was not paid.  The default  amount
included   principal  and  accrued   interest  of  $1,350,000  and  $10,185,885,
respectively.  On June 29, 2007,  the property  owned by Jewish  Federation  was
sold.  The  Partnership's  share of the sale proceeds was applied to the pay off
the purchase  money note at a discount.  As of June 29, 2007,  the principal and
accrued  interest  balances were $1,350,000 and $14,066,427,  respectively.  The
sale resulted in gain on extinguishment of debt for financial statement purposes
of $15,384,520 in 2007 and $14,087,237 for federal tax purposes.

c.   Assets held for sale or transfer
     --------------------------------

                                  Asbury Tower
                                  ------------

     See Note 2.a., above.


                                       -9-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


2. INVESTMENTS IN PARTNERSHIPS - Continued

                                   Hale Ohana
                                   ----------

     The Partnership  has been informed that the Local Managing  General Partner
signed a contract  to sell the  property  related to Lihue II  Associates  (Hale
Ohana).  Due to the impending sale of the property,  the Partnership's  basis in
the Local Partnership, along with the net unamortized amount of acquisition fees
and property  purchase  costs,  which totaled  $7,739 at June 30, 2008, has been
reclassified  to  investment  in  partnerships  held for sale or transfer in the
accompanying consolidated balance sheet at that date. There is no assurance that
a sale will occur.

                                 Madison Square
                                 --------------

     On May 7, 2007,  the Local  Managing  General  Partner signed a contract to
sell the property related to Madison Square,  Ltd.  Dividend Housing  Associates
(Madison  Square) to a  non-profit.  Due to the  impending  sale of the property
owned by Madison Square, the Partnership's basis in the Local Partnership, which
totaled $0 at both June 30, 2008 and December 31, 2007, has been reclassified to
asset held for sale or transfer in the accompanying consolidated balance sheets.
Net  capitalized  acquisition  fees and property  purchase costs were reduced to
zero at June 30, 2007. There is no assurance that a sale will occur.

                               Pilgrim Tower East
                               ------------------

     See Note 2.a., above.

                                Westport Village
                                ----------------

     See Note 2.a., above.

d.   Summarized financial information
     --------------------------------

     Combined  statements  of  operations  for the  eleven  and  thirteen  Local
Partnerships in which the Partnership was invested as of June 30, 2008 and 2007,
respectively,   follow.   The  combined   statements  have  been  compiled  from
information  supplied  by the  management  agents  of  the  properties  and  are
unaudited.  The information for each of the periods is presented  separately for
those Local  Partnerships  which have investment basis (equity method),  and for
those Local Partnerships which have cumulative losses in excess of the amount of
the  Partnership's  investments  in  those  Local  Partnerships  (equity  method
suspended). Appended after the combined statements is information concerning the
Partnership's  share of income from partnerships  related to cash  distributions
recorded as income, and related to the Partnership's  share of income from Local
Partnerships.

                                      -10-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


2.   INVESTMENTS IN PARTNERSHIPS - Continued

<TABLE>
<CAPTION>
                                     COMBINED STATEMENTS OF OPERATIONS
                                                (Unaudited)

                                                             For the three months ended
                                                                      June 30,
                                              ------------------------------------------------------------
                                                         2008                             2007
                                              --------------------------       ---------------------------
                                                Equity                           Equity
                                                Method        Suspended          Method         Suspended
                                              ----------      ----------       ----------       ----------
     <S>                                      <C>             <C>              <C>              <C>
     Number of Local Partnerships                  4              7                4                7
                                                   =              =                =                =

     Revenue:
       Rental                                 $  858,955      $2,297,216       $  799,022       $2,298,996
       Other                                      79,128         151,279           22,310          156,262
                                              ----------      ----------       ----------       ----------

         Total revenue                           938,083       2,448,495          821,332        2,455,258
                                              ----------      ----------       ----------       ----------

     Expenses:
       Operating                                 721,135       1,781,778          512,497        1,670,150
       Interest                                  (10,596)        453,723             (186)         456,372
       Depreciation and amortization             170,505         554,400          164,399          529,972
                                              ----------      ----------       ----------       ----------

         Total expenses                          881,044       2,789,901          676,710        2,656,494
                                              ----------      ----------       ----------       ----------

     Net income (loss)                        $   57,039      $ (341,406)      $  144,622       $ (201,236)
                                              ==========      ==========       ==========       ==========


     Cash distributions                       $       --      $  487,683       $       --       $  104,014
                                              ==========      ==========       ==========       ==========


     Cash distributions recorded
       as income                              $       --      $  487,683       $       --       $  104,014

     Partnership's share of Local
       Partnership net income (loss)              56,465              --          143,160               --
                                              --------------------------       ---------------------------

     Share of income from partnerships                $544,148                            $247,174
                                                      ========                            ========
</TABLE>

                                      -11-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


2.   INVESTMENTS IN PARTNERSHIPS - Continued

<TABLE>
<CAPTION>
                                                                For the six months ended
                                                                        June 30,
                                              ------------------------------------------------------------
                                                         2008                             2007
                                              --------------------------       ---------------------------
                                                Equity                           Equity
                                                Method        Suspended          Method         Suspended
                                              ----------      ----------       ----------       ----------
     <S>                                      <C>             <C>               <C>             <C>
     Number of Local Partnerships                 4               7                 4               7
                                                  =               =                 =               =

     Revenue:
       Rental                                 $1,711,806      $4,594,432       $1,653,717       $4,597,992
       Other                                     168,839         302,558          104,031          312,524
                                              ----------      ----------       ----------       ----------

         Total revenue                         1,880,645       4,896,990        1,757,748        4,910,516
                                              ----------      ----------       ----------       ----------

     Expenses:
       Operating                               1,434,113       3,563,556        1,244,472        3,340,300
       Interest                                  (21,192)        907,447             (372)         912,743
       Depreciation and amortization             341,009       1,108,800          328,798        1,059,944
                                              ----------      ----------       ----------       ----------

         Total expenses                        1,753,930       5,579,803        1,572,898        5,312,987
                                              ----------      ----------       ----------       ----------

     Net income (loss)                        $  126,715      $ (682,813)      $  184,850       $ (402,471)
                                              ==========      ==========       ==========       ==========

     Cash distributions                       $       --      $  487,683       $       --       $  104,014
                                              ==========      ==========       ==========       ==========


     Cash distributions recorded
       as income                              $       --      $  487,683       $       --       $  104,014

     Partnership's share of Local
       Partnership net (loss) income             125,436              --          182,982               --
                                              --------------------------       -----------      ----------

     Share of income from partnerships                $613,119                         $286,996
                                                      ========                         ========
</TABLE>

     Cash  distributions  received from Local Partnerships which have investment
basis (equity method) are recorded as a reduction of investments in partnerships
and as  cash  receipts  on the  respective  consolidated  balance  sheets.  Cash
distributions  received from Local  Partnerships which have cumulative losses in
excess  of  the  amount  of  the   Partnership's   investments  in  those  Local
Partnerships  (equity  method  suspended)  are  recorded as share of income from
partnerships on the respective consolidated statements of operations and as cash
receipts on the respective  consolidated balance sheets. As of June 30, 2008 and
2007,  the  Partnership's  share of  cumulative  losses to date for seven of the
eleven and for seven of the eleven Local  Partnerships,  respectively,  exceeded
the amount of the  Partnership's  investments  in those  Local  Partnerships  by
$13,078,665  and  $11,452,708,  respectively.  As the Partnership has no further
obligation  to advance funds or provide  financing to these Local  Partnerships,
the excess  losses  have not been  reflected  in the  accompanying  consolidated
financial statements.

                                      -12-

<PAGE>
                 CAPITAL REALTY INVESTORS-IV LIMITED PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 2008 and 2007

                                   (Unaudited)


3.   RELATED PARTY TRANSACTIONS

     In accordance with the terms of the Partnership Agreement,  the Partnership
is obligated to reimburse the Managing  General  Partner or its  affiliates  for
direct  expenses in connection  with managing the  Partnership.  The Partnership
paid  $84,953 and $137,819  for the three and six month  periods  ended June 30,
2008, respectively, and $62,772 and $125,371 for the three and six month periods
ended June 30,  2007,  respectively.  Such  expenses are included in general and
administrative   expenses  in  the  accompanying   consolidated   statements  of
operations.

     In accordance with the terms of the Partnership Agreement,  the Partnership
is obligated to pay the Managing General Partner an annual incentive  management
fee  (Management  Fee) after all other expenses of the Partnership are paid. The
Partnership  paid the Managing  General  Partner a Management Fee of $93,750 for
each of the three month  periods  ended June 30, 2008 and 2007 and  $187,500 for
each of the six month periods ended June 30, 2008 and 2007.

     In accordance  with the terms of the  Partnership  Agreement,  the Managing
General  Partner  and/or its  affiliates  may receive a fee of not more than two
percent  of the  sale  price  of an  investment  in a Local  Partnership  or the
property  it  owns,  payable  under  certain  conditions  upon  the  sale  of an
investment in a Local  Partnership  or the property it owns.  The payment of the
fee is subject to certain  restrictions,  including the achievement of a certain
level of sale  proceeds  and making  certain  minimum  distributions  to limited
partners.

Cash concentration risk
-----------------------

     Financial   instruments  that   potentially   subject  the  Partnership  to
concentrations of risk consist primarily of cash. The Partnership  maintains two
cash  accounts  with the same bank.  The  balances  are  insured by the  Federal
Deposit Insurance Corporation up to $100,000. As of June 30, 2008, the uninsured
portion of the cash balances was $8,257,361.

                                      # # #

                                      -13-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis
          of Financial Condition and Results of Operations


     Capital  Realty  Investors-IV   Limited   Partnership's  (the  Partnership)
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations  section  is  based on the  consolidated  financial  statements,  and
contains   information  that  may  be  considered  forward  looking,   including
statements regarding the effect of governmental regulations.  Actual results may
differ  materially from those  described in the forward  looking  statements and
will be affected by a variety of factors  including  national and local economic
conditions,  the  general  level of  interest  rates,  governmental  regulations
affecting  the  Partnership  and  interpretations  of  those  regulations,   the
competitive  environment in which the Partnership operates, and the availability
of working capital.

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

     The  Partnership has disclosed its selection and application of significant
accounting policies in Note 1 of the notes to consolidated  financial statements
included in the Partnership's annual report on Form 10-KSB at December 31, 2007.
The   Partnership   accounts  for  its   investments  in   partnerships   (Local
Partnerships)  by the equity method because the Partnership is a limited partner
in the Local  Partnerships.  As such the  Partnership  has no  control  over the
selection and application of accounting  policies,  or the use of estimates,  by
the  Local  Partnerships.  Environmental  and  operational  trends,  events  and
uncertainties  that might affect the properties owned by the Local  Partnerships
would not necessarily have a significant impact on the Partnership's application
of the equity method of  accounting,  since the equity method has been suspended
for seven  Local  Partnerships  which  have  cumulative  losses in excess of the
amount of the Partnership's investments in those Local Partnerships.

                                     General
                                     -------

     Some of the rental properties owned by the Local  Partnerships are financed
by state and federal housing agencies.  The Managing General Partner has sold or
refinanced, and will continue to sell or refinance,  certain properties pursuant
to  programs   developed  by  these   agencies.   These   programs  may  include
opportunities  to sell a property to a qualifying  purchaser  who would agree to
maintain  the  property as low to moderate  income  housing,  or to  refinance a
property,  or to obtain  supplemental  financing.  The Managing  General Partner
continues to monitor  certain state housing  agency  programs,  and/or  programs
provided by certain lenders,  to ascertain  whether the properties would qualify
within the  parameters  of a given  program and  whether  these  programs  would
provide  an  appropriate  economic  benefit  to  the  Limited  Partners  of  the
Partnership.

     The U. S. Department of Housing and Urban  Development  (HUD) subsidies are
provided principally under Sections 8 and 236 of the National Housing Act. Under
Section 8, the  government  pays to the  applicable  apartment  partnership  the
difference between market rental rates (determined in accordance with government
procedures)  and the rate the  government  deems  residents  can  afford.  Under
Section  236,  the  government  provides  interest  subsidies  directly  to  the
applicable apartment  partnership through a reduction in the property's mortgage
interest rate. In turn, the partnership  provides a  corresponding  reduction in
resident  rental rates.  In compliance  with the  requirements of Section 8, and
Section  236,  residents  are  screened for  eligibility  under HUD  guidelines.
Subsidies are provided under  contracts  between the federal  government and the
apartment partnerships.

     Subsidy contracts for the investment  apartment properties are scheduled to
expire through 2019.  The Local  Partnerships  seek renewal of expiring  subsidy
contracts, when appropriate,  for their properties. HUD has in the past approved
new subsidy  contracts on an annual basis  subject to annual  appropriations  by
Congress. The initial HUD contract renewal process currently provides owners six
options for renewing  their section 8 contract  depending upon whether the owner
can meet the eligibility criteria. Historically, the Local Partnerships in which
the  Partnership  is invested  have met the  criteria  necessary  to renew their
respective Section 8 contracts.

                                      -14-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis
          of Financial Condition and Results of Operations - Continued


     As of June 30, 2008, the carrying amount of the Partnership's investment in
the Local  Partnership  with  Section 8 HAP  contracts  expiring  in the next 12
months and which was not sold on or before August 13, 2008, was $1,907,099.

     The Managing  General  Partner  continues to seek  strategies  to deal with
affordable housing policy. While the Managing General Partner cannot predict the
outcome for any particular  property at this time, the Managing  General Partner
will continue to work with the Local  Partnerships  to develop  strategies  that
maximize the benefits to investors.

                          Financial Condition/Liquidity
                          -----------------------------

     The Partnership's liquidity, with unrestricted cash resources of $8,158,590
as of June 30, 2008, along with anticipated future cash distributions from Local
Partnerships,  is expected  to be  adequate to meet its current and  anticipated
operating cash needs. As of August 13, 2008, there were no material  commitments
for capital  expenditures.  The Managing  General Partner  currently  intends to
retain all of the Partnership's  remaining undistributed cash pending resolution
of the  Partnership's  outstanding  purchase  money  notes and  related  accrued
interest, and for operating cash reserves.

     The  Partnership's  obligations  with respect to its  investments  in Local
Partnerships,  in the  form  of  nonrecourse  purchase  money  notes  having  an
aggregate  principal  balance of $9,317,081 plus aggregate  accrued  interest of
$43,662,679  as of June 30, 2008,  are payable in full upon the earliest of: (i)
sale or refinancing of the respective Local Partnership's rental property;  (ii)
payment in full of the respective Local  Partnership's  permanent loan; or (iii)
maturity.

     The  collateral  that  secured  the  purchase  money  notes  related to the
following properties were sold to the noteholders during 2007.


     Property                             Principal       Date      Disposition
     --------                            -----------    ---------   -----------

     Crescent Gardens - Second Note      $  434,000     June 2007      Sale
     Jewish Federation                    1,350,000     June 2007      Sale


     The purchase money notes related to the following  properties  have matured
and have not been paid or extended as of August 13, 2008.

                                              Accrued Interest
                                                   As of
     Property                 Principal         June 30, 2008         Maturity
     --------                -----------      -----------------     -----------

     Westport Village (1)    $  840,000          $2,642,925           09/01/99
     Pilgrim Tower East       1,450,000 (2)       4,583,413           11/30/03
     Cedar Point              1,320,000           3,816,608           08/30/04
     Thornwood House          1,775,000           4,949,846           08/30/04


     (1) In receivership.
     (2) Remaining principal, after partial payment.

     The  purchase  money note secured by the  Partnership's  interest in Asbury
Tower was due to mature on August  31,  2004.  However,  the  noteholder  orally
agreed to extend the maturity  date on a month to month basis until such time as
the noteholder  provides a 30 day advance notice to the  Partnership.  Effective
January 1, 2008 the interest rate was reduced to 4 percent. As of June 30, 2008,
principal and accrued  interest due on the purchase  money note were  $3,432,081
and $24,615,606,  respectively.  The Local Managing General Partner is currently
negotiating  the sale of the property  owned by Asbury  Towers to an  affiliate.
Proceeds  from the sale  will be used to payoff  the  purchase  money  note at a
discount. There is no assurance that the sale of the property will occur.


                                      -15-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis
          of Financial Condition and Results of Operations - Continued


     Due to the  impending  sale of the  property  owned by  Asbury  Tower,  the
Partnership's  basis in the Local  Partnership,  along with the net  unamortized
amount of acquisition fees and property purchase costs, which totaled $53,727 at
both June 30, 2008 and December 31, 2007,  have been  reclassified to investment
in  partnerships  held for sale or  transfer  in the  accompanying  consolidated
balance sheets.

     The remaining  purchase  money note related to  Northridge  Park matures in
2025. As of June 30, 2008, principal and accrued interest balances were $500,000
and $3,054,281, respectively.

     As of June 30, 2008, Westport Village is in receivership. The Partnership's
non-recourse  purchase  money notes and accrued  interest  totaled  $840,000 and
$2,642,925,  respectively at June 30, 2008. The Partnership is not  anticipating
any loss resulting from the anticipated change in ownership upon foreclosure.

     See the notes to  consolidated  financial  statements  contained in Part I,
Item 1, hereof, for additional information concerning purchase money notes.

     The purchase money notes,  which are  nonrecourse to the  Partnership,  are
generally  secured  by  the  Partnership's  interest  in  the  respective  Local
Partnerships.  There is no assurance  that the underlying  properties  will have
sufficient appreciation and equity to enable the Partnership to pay the purchase
money notes'  principal and accrued  interest when due. If a purchase money note
is not paid in accordance with its terms,  the  Partnership  will either have to
renegotiate  the terms of repayment or risk losing its  partnership  interest in
the  respective  Local  Partnership.  In the event  that a  purchase  money note
remains unpaid upon maturity,  the noteholder may have the right to foreclose on
the Partnership's interest in the related Local Partnership.

     The  Partnership's  inability  to pay  certain of the  purchase  money note
principal and accrued interest balances when due, and the resulting  uncertainty
regarding the Partnership's  continued  ownership  interest in the related Local
Partnerships,  does not adversely impact the Partnership's  financial  condition
because the  purchase  money  notes are  nonrecourse  and secured  solely by the
Partnership's interest in the related Local Partnerships.  Therefore, should the
investment in any of the Local  Partnerships  with matured or maturing  purchase
money notes not produce  sufficient  value to satisfy the related purchase money
notes, the  Partnership's  exposure to loss is limited because the amount of the
nonrecourse indebtedness of each of the matured or maturing purchase money notes
exceeds the  carrying  amount of the  investment  in each of the  related  Local
Partnerships.  Thus, even a complete loss of the Partnership's interest in these
Local  Partnerships  would not have a material  adverse  impact on the financial
condition of the Partnership.

     The Managing General Partner continues to investigate possible alternatives
to reduce the Partnership's debt obligations.  These alternatives include, among
others, retaining the cash available for distribution to meet the purchase money
note  requirements,  paying off certain  purchase  money  notes at a  discounted
price, extending the due dates of certain purchase money notes,  refinancing the
respective  properties'  underlying  debt, or selling the underlying real estate
and using the  Partnership's  share of the  proceeds to pay or buy down  certain
purchase money note  obligations.  Although the Managing General Partner has had
some success applying these strategies in the past, the Managing General Partner
cannot assure that these  strategies  will be  successful in the future.  If the
Managing  General  Partner is unable to negotiate  an  extension  or  discounted
payoff,  in the event that the purchase money notes remain unpaid upon maturity,
the noteholders may have the right to foreclose on the Partnership's interest in
the related Local Partnerships.  In the event of a foreclosure or other transfer
of the Partnership's  interest, the excess of the nonrecourse  indebtedness over
the  carrying  amount  of the  Partnership's  investment  in the  related  Local
Partnership  will result in a taxable gain. This gain will be taxable to Limited
Partners at a federal  tax rate of up to 35.0%.  Additionally,  the  Partnership
would lose its investment in the Local Partnership and,  likewise,  its share of

                                      -16-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis
          of Financial Condition and Results of Operations - Continued


any future cash  distributed by the Local  Partnership  from rental  operations,
mortgage  debt  refinancings,  or sale of the real  estate.  Of the eleven Local
Partnerships  in which the Partnership is invested as of June 30, 2008, the four
Local Partnerships with associated  purchase money notes which have matured,  or
which mature  through June 30, 2008, and which remain unpaid or unextended as of
August 13, 2008,  represented  the following  percentages  of the  Partnership's
total  distributions  received from Local  Partnerships and share of income from
Local Partnerships for the immediately preceding two calendar years.

                             Percentage of Total       Partnership's Share of
                            Distributions Received          Loss from
     For the Year Ended     from Local Partnerships      Local Partnerships
     ------------------     -----------------------    ----------------------

     December 31, 2007                0%                     $ 69,448
     December 31, 2006                0%                     $539,623


     The  Managing  General  Partner  continues  to  address  the  maturity  and
impending  maturity of the Partnership's  debt obligations and to seek solutions
that will provide the most favorable outcome to the Limited  Partners.  However,
there can be no assurance that these strategies will be successful.

     The Partnership closely monitors its cash flow and liquidity position in an
effort to ensure that sufficient  cash is available for operating  requirements.
For the six month period  ended June 30,  2008,  existing  cash  resources  were
adequate  to support  operating  cash  requirements.  Cash and cash  equivalents
increased $111,991 during the three month period ended June 30, 2008, due to the
receipt  of  distributions  from  partnerships,  partially  offset by  operating
expenses paid in cash.

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

     The Partnership's net income for the three month period ended June 30, 2008
decreased from the corresponding  period in 2007, primarily due to a decrease in
gain from  extinguishment of debt.  Contributing to the decrease were a decrease
in interest  income and  increases  in general and  administrative  expenses and
professional   fees,   partially  offset  by  increased  share  of  income  from
partnerships  and  decreases in interest  expense and  amortization  of deferred
costs. Interest revenue decreased due to lower rates in 2008.  Professional fees
increased due to higher audit costs. The increase in share of income partnership
is primarily  due to a higher  distribution  received  from one property and the
timing of receipt. Interest expense decreased due to a lower purchase money note
balance  and the rate on the Asbury  Tower  purchase  money note being  reduced.
Amortization of deferred costs decreased as net capitalized acquisition fees and
property purchase costs were reduced to zero for Madison Square in 2007.

     The Partnership recognized net loss for the six month period ended June 30,
2008 compared to net income during the corresponding  period in 2007,  primarily
due to a decrease in gain from extinguishment of debt.  Contributing to net loss
were a decrease in interest revenue and increased  professional fees,  partially
offset by decreases in interest  expense and amortization of deferred costs, all
as stated above. General and administrative  expenses increased primarily due to
higher reimbursed payroll costs.

     For financial reporting purposes, the Partnership,  as a limited partner in
the Local  Partnerships,  does not record losses from the Local  Partnerships in
excess of its  investment  to the  extent  that the  Partnership  has no further
obligation to advance funds or provide financing to the Local Partnerships. As a
result,  the  Partnership's  share of income from partnerships for the three and
six month  periods  ended June 30, 2008 did not include  losses of $440,633  and
$881,268, respectively, compared to excluded losses of $168,550 and $467,450 for
the three and six month periods ended June 30, 2007, respectively.

                                      -17-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis
          of Financial Condition and Results of Operations - Continued


     No other  significant  changes in the  Partnership's  operations have taken
place during the three month period ended June 30, 2008.

     Certain  states may assert claims  against the  Partnership  for failure to
withhold and remit state income tax on operating  profit or where the sale(s) of
property in which the Partnership was invested failed to produce sufficient cash
proceeds  with  which to pay the state tax and/or to pay  statutory  partnership
filing fees. The  Partnership is unable to quantify the amount of such potential
claims at this time. The Partnership has consistently  advised its Partners that
they  should  consult  with their tax  advisors  as to the  necessity  of filing
non-resident  returns in such states with  respect to their  proportional  taxes
due.


Item 4. Controls and Procedures

     In July  2008,  representatives  of the  Managing  General  Partner  of the
Partnership  carried out an  evaluation of the  effectiveness  of the design and
operation of the Partnership's  disclosure controls and procedures,  pursuant to
Exchange Act Rules  13a-15 and 15d-15.  The  Managing  General  Partner does not
expect that the  Partnership's  disclosure  controls and procedures will prevent
all error and all fraud.  A control  system,  no matter how well  conceived  and
operated,  can provide only  reasonable  assurance  that the  objectives  of the
control system are met. Further, the design of a control system must reflect the
fact that there are resource  constraints,  and the benefits of controls must be
considered relative to their costs.  Because of the inherent  limitations in all
control systems,  no evaluation of controls can provide absolute  assurance that
all control issues have been detected.  These inherent  limitations  include the
realities that judgments in  decision-making  can be faulty, and that breakdowns
can occur  because  of simple  error or  mistake.  The  design of any  system of
controls also is based in part upon certain  assumptions about the likelihood of
future  events,  and there can be no  assurance  that any design will succeed in
achieving its stated goals under all  potential  future  conditions.  Over time,
controls may become inadequate  because of changes in conditions,  or the degree
of compliance  with the policies or procedures may  deteriorate.  Because of the
inherent  limitations in a cost-effective  control system,  misstatements due to
error or fraud may  occur and not be  detected.  Based on such  evaluation,  our
principal  executive officer and principal financial officer have concluded that
as of June 30, 2008,  our disclosure  controls and procedures  were effective to
ensure that (i) the  information  required to be  disclosed by us in the reports
filed or submitted by us under the Securities  Exchange Act of 1934, as amended,
was  recorded,  processed,  summarized  or  reported  within  the  time  periods
specified in the SEC's rules and forms and (ii) such information was accumulated
and communicated to management,  including our principal  executive  officer and
principal  financial  officer,  to allow  timely  decisions  regarding  required
disclosure.  In  addition,  there  have  been  no  significant  changes  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.


Part II. OTHER INFORMATION
Item 3. Defaults upon Senior Securities

     See Note 2.a. of the notes to consolidated  financial  statements contained
in Part I, Item 1, hereof, for information concerning the Partnership's defaults
on certain purchase money notes.



                                      -18-

<PAGE>
Part II. OTHER INFORMATION
Item 5. Other Information


     There has not been any information  required to be disclosed in a report on
Form 8-K during the quarter ended June 30, 2008,  but not  reported,  whether or
not otherwise required by this Form 10-Q at June 30, 2008.

     There  is no  established  market  for the  purchase  and  sale of units of
additional limited partner interest (Units) in the Partnership, although various
informal  secondary market services exist. Due to the limited markets,  however,
investors may be unable to sell or otherwise dispose of their Units.


Item 6. Exhibits

Exhibit No.    Description
----------     -----------

   31.1        Certification  of  Principal  Executive  Officer,  pursuant to 18
               U.S.C.  Section 1350,  as adopted  pursuant to Section 302 of the
               Sarbanes-Oxley Act of 2002.

   31.2        Certification  of  Principal  Financial  Officer,  pursuant to 18
               U.S.C.  Section 1350,  as adopted  pursuant to Section 302 of the
               Sarbanes-Oxley Act of 2002.

   32          Certification  of  Principal   Executive  Officer  and  Principal
               Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted
               pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

All other Items are not applicable.

                                      -19-

<PAGE>
                                    SIGNATURE

     In accordance  with the  requirements  of the Exchange Act, the  registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                  CAPITAL REALTY INVESTORS-IV LIMITED
                                    PARTNERSHIP
                                  ----------------------------------------------
                                  (Registrant)

                                  by:  C.R.I., Inc.
                                       -----------------------------------------
                                       Managing General Partner



August 13, 2008                        by:  /s/ H. William Willoughby
---------------                             ------------------------------------
DATE                                        H. William Willoughby,
                                            Director, President, Secretary,
                                              Principal Financial Officer and
                                              Principal Accounting Officer







                                      -20-