UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    ---------

                                   FORM 10-KSB

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

For the fiscal year ended December 31, 1999       Commission File Number 0-19063


                           PHOENIX INCOME FUND, L.P.
--------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

          California                                     68-0204588
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)


2401 Kerner Boulevard, San Rafael, California                 94901-5527
--------------------------------------------------------------------------------
(Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code:     (415) 485-4500
                                                        --------------

Securities registered pursuant to Section 12(b) of the Act:  NONE

Securities  registered  pursuant to Section  12(g) of the Act:  Units of Limited
Partnership Interest

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-B is not contained  herein,  and will not be contained,  to the
best of Registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB.
____________

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 _____  No __X__

The Registrant's revenue for its most recent fiscal year was $1,347,000.

As of December 31, 1999,  169,587  Units of Limited  Partnership  interest  were
outstanding.  No  market  exists  for the  Units  of  Partnership  interest  and
therefore there exists no aggregate market value at December 31, 1999.

                    DOCUMENTS INCORPORATED BY REFERENCE: NONE

Transitional Small Business Disclosure Format:

                             Yes _____  No __X__



                                  Page 1 of 26

<PAGE>


                            PHOENIX INCOME FUND, L.P.

                         1999 FORM 10-KSB ANNUAL REPORT

                                TABLE OF CONTENTS

                                                                            Page

                                     PART I

Item 1.       Business......................................................  3
Item 2.       Properties....................................................  4
Item 3.       Legal Proceedings.............................................  5
Item 4.       Submission of Matters to a Vote of Security Holders...........  5

                                     PART II

Item 5.       Market for the Registrant's Securities and Related Security
                Holder Matters..............................................  5
Item 6.       Management's Discussion and Analysis of Financial Condition
                and Results of Operations...................................  6
Item 7.       Financial Statements..........................................  9
Item 8.       Disagreements on Accounting and Financial Disclosure Matters.. 23

                                    PART III

Item 9.       Directors and Executive Officers of the Registrant............ 23
Item 10.      Executive Compensation........................................ 24
Item 11.      Security Ownership of Certain Beneficial Owners and
                Management.................................................. 24
Item 12.      Certain Relationships and Related Transactions................ 25

                                     PART IV

Item 13.      Exhibits, Financial Statement Schedules and Reports on
                Form 8-K.................................................... 25


Signatures.................................................................. 26

                                       2
<PAGE>

                                     PART I

Item 1.       Business.
              --------

General Development of Business.

         Phoenix  Income  Fund,  L.P.,  a California  limited  partnership  (the
"Partnership"),  was  organized  on  November  17,  1989.  The  Partnership  was
registered with the Securities and Exchange Commission with an effective date of
January 18, 1991 and shall continue to operate until its termination date unless
dissolved  sooner  due to the sale of  substantially  all of the  assets  of the
Partnership or a vote of the Limited Partners. The Partnership will terminate on
December 31, 2006.  The General  Partner is a  California  limited  partnership,
Phoenix  Leasing  Associates LP, the general partner of which is Phoenix Leasing
Associates,  Inc., a Nevada corporation ("PLA") and a wholly-owned subsidiary of
Phoenix Leasing Incorporated ("PLI"). The General Partner or its affiliates also
is or has been a general partner in several other limited partnerships formed to
invest in capital equipment and other assets.

         The  initial   public   offering  was  for  300,000  units  of  limited
partnership interest at a price of $250 per unit. The Partnership  completed its
public offering on July 28, 1992. The Partnership sold 175,285 units for a total
capitalization  of $43,821,250.  Of the proceeds  received through the offering,
the Partnership has incurred $6,017,000 in organizational and offering expenses.

         From the initial  formation  of the  Partnership  through  December 31,
1999,  the total  investments  in equipment  leases and  financing  transactions
(loans),  including the  Partnership's  pro-rata interest in investments made by
joint  ventures,  approximate  $90,886,000.  The  average  initial  firm term of
contractual  payments  from  equipment  subject to lease was 42 months,  and the
average  initial  net  monthly  payment  rate as a  percentage  of the  original
purchase price was 2.74%. The average initial firm term of contractual  payments
from loans was 66 months.

Narrative Description of Business.

         The  Partnership's  principal  objective is to produce cash flow to the
investors on a  continuing  basis over the life of the  Partnership.  To achieve
this  objective,  the  Partnership  will  invest  in  various  types of  capital
equipment and other assets to provide  leasing or financing of the same to third
parties, including Fortune 1000 companies and their subsidiaries,  middle-market
companies,  emerging growth companies, cable television operators and others, on
either  a  long-term  or  short-term  basis.  The  types of  equipment  that the
Partnership  will  invest  in will  include,  but is not  limited  to,  computer
peripherals, terminal systems, small computer systems, communications equipment,
IBM mainframes,  IBM-software compatible mainframes, office systems, CAE/CAD/CAM
equipment,  telecommunications  equipment,  cable television equipment,  medical
equipment, production and manufacturing equipment and software products.

         In addition to  acquiring  equipment  for lease to third  parties,  the
Partnership,  either directly or through the investment in joint  ventures,  has
provided  limited  financing  to  certain  emerging  growth   companies,   cable
television  operators,  manufacturers  and their  lessees with respect to assets
leased  directly  by  such  manufacturers  to  third  parties.  The  Partnership
maintains a security  interest in the assets financed and in the receivables due
under any lease or rental  agreement  relating  to such  assets.  Such  security
interests  constitute a lien on the equipment and will give the  Partnership the
right, upon default, to obtain possession of the assets.

         The Partnership has acquired significant amounts of equipment or assets
and has provided  financing  with the net offering  proceeds.  In addition,  the
Partnership also acquired equipment through the use of debt financing,  however,
the  ratio  of the  outstanding  debt  to net  capital  contributions  less  any
investment in Leveraged Joint Ventures at the end of the Partnership's  offering
period,  and thereafter,  will not exceed one to one. The cash flow generated by
such investments in equipment leases or financing transactions has been and will
be used to provide  for debt  service,  to  provide  cash  distributions  to the
Partners and the  remainder  will be  reinvested  in capital  equipment or other
assets.

         The Partnership has acquired and intends to acquire and lease equipment
pursuant to either  "Operating"  leases or "Financing"  leases.  At December 31,
1999,  none of the leased  assets owned by the  Partnership  was  classified  as
Financing  leases.  The  Partnership  has also  provided  and intends to provide
financing  secured by assets in the form of notes  receivable.  Operating leases
are generally  short-term  leases under which the lessor will receive  aggregate
rental  payments  in an  amount  that is less  than  the  purchase  price of the
equipment.  Financing  leases are  generally  for a longer  term under which the

                                       3
<PAGE>

noncancellable  rental  payments due during the initial term of the lease are at
least  sufficient to recover the purchase price of the equipment.  A significant
portion of the net offering  proceeds to the  Partnership  has been  invested in
capital equipment subject to Operating leases.

         Operating  leases  represent  a  greater  risk  along  with  a  greater
potential  return  to the  Partnership  than do  Financing  leases.  In order to
recover its investment in equipment  leased pursuant to an Operating  lease, the
Partnership  will,  upon  termination  of such  lease,  either  have to obtain a
renewal from the original lessee,  find a new lessee or sell the equipment.  The
terms for Operating  leases are for a shorter  duration than  Financing  leases.
Consequently, the revenues derived from the initial term of Operating leases are
generally  greater  than  those of Full  Payout  leases.  Due to  technological,
competitive,  market and economic  factors,  it is anticipated  that renewals or
remarkets of leases may be at a lower rental rate than that of the initial lease
terms.  In  spite  of the  remarketing  risks  associated  with  investments  in
Operating   leases,   the  General   Partner   believes   there  are  profitable
opportunities resulting from such investments.

         Competition.   The  General   Partner   intends  to   concentrate   the
Partnership's  activities in the equipment  leasing and financing  industry,  an
area in which the General  Partner has  developed  an  expertise.  The  computer
equipment leasing industry is extremely  competitive.  The Partnership  competes
with many well established  companies  having  substantially  greater  financial
resources.  Competitive  factors include pricing,  technological  innovation and
methods  of  financing  (including  use  of  various  short-term  and  long-term
financing plans, as well as the outright purchase of equipment).  Generally, the
impact of these factors to the Partnership would be the realization of increased
equipment  remarketing and storage costs,  as well as lower  residuals  received
from the sale or remarketing of such equipment.

Other.

         A brief  description of the type of assets in which the Partnership has
invested as of December 31, 1999, together with information  concerning the uses
of assets is set forth in Item 2.

Item 2.       Properties.
              ----------

         The  Partnership  is engaged in the  equipment  leasing  and  financing
industry and as such,  does not own or operate any  principal  plants,  mines or
real property. The primary assets held by the Partnership are its investments in
leases and loans to businesses located throughout the United States.

         As of  December  31,  1999,  the  Partnership  owns  equipment  and has
outstanding  loans to borrowers  with an aggregate  original cost of $1,083,000.
The following  table  summarizes the type of equipment  owned or financed by the
Partnership at December 31, 1999.

                                                                   Percentage of
                Asset Types                   Purchase Price(1)    Total Assets
----------------------------------------      -----------------    -------------
                                            (Amounts in Thousands)

Capital Equipment Leased to Emerging
  Growth Companies                                $  369                34%
Financing to Businesses                              337                31
Telecommunications                                   186                17
Miscellaneous                                         96                 9
Computer Peripherals                                  61                 5
Small Computer Systems                                29                 3
Furniture and Fixtures                                 5                 1
                                                 -------               ---

TOTAL                                             $1,083               100%
                                                 =======               ===

(1)      These amounts include the original cost of outstanding loans of $47,000
         at December 31, 1999.


                                       4
<PAGE>



Item 3.       Legal Proceedings.
              -----------------

         The  Registrant is not a party to any pending legal  proceedings  which
would have a material adverse impact on its financial position.

Item 4.       Submission of Matters to a Vote of Security Holders.
              ---------------------------------------------------

         No matters were  submitted to a vote of Limited  Partners,  through the
solicitation of proxies or otherwise, during the year covered by this report.

                                     PART II

Item 5.       Market for the Registrant's Securities and Related Security Holder
              ------------------------------------------------------------------
              Matters.
              --------

         (a)  The Registrant's  limited  partnership  interests are not publicly
              traded.   There  is  no  market  for  the   Registrant's   limited
              partnership interests and it is unlikely that any will develop.

         (b) Approximate number of equity security investments:

                                                        Number of Unit Holders
                     Title of Class                     as of December 31, 1999
              ----------------------------              -----------------------

              Limited Partners                                      3,641
              General Partner                                           1


                                       5
<PAGE>

Item 6.  Management's Discussion and Analysis of Financial Condition and Results
         -----------------------------------------------------------------------
         of Operations.
         -------------

Results of Operations

         Phoenix Income Fund,  L.P.,  (the  Partnership)  reported net income of
$1,134,000  and  $1,444,000  during the years ended  December 31, 1999 and 1998,
respectively. The Partnership reported an overall decrease in total revenues and
expenses  for the year ended  December  31,  1999.  However,  the  decreases  in
revenues exceeded the decreases in expenses, generating a decrease in net income
for the year ended December 31, 1999, compared to the previous year.

         Total  revenues  decreased by $751,000  during 1999, as compared to the
same  period  in the  previous  year.  The  decrease  in total  revenues  is due
primarily to decreases in rental income,  earned income from  financing  leases,
interest  income from notes  receivable  and a decrease  in earnings  from joint
ventures.  However, an increase in gain on sale of securities of $469,000 during
the year ended  December  31,  1999,  compared to the  previous  year,  caused a
smaller  decrease  in  revenues  for this  period  than  there  would  have been
otherwise.  Rental income  decreased by $960,000  during 1999 as compared to the
same period in the previous year. The decrease in rental income is  attributable
to a decrease in the amount of equipment  owned that is  classified as operating
leases.  At December 31, 1999, the Partnership owned equipment with an aggregate
original cost of $745,000,  as compared to the $7 million of equipment  owned at
December 31, 1998.

         Earned income from financing  leases  decreased by $167,000  during the
year ended  December  31,  1999,  as compared  to the same period in 1998.  This
decrease is  attributable  to the  decrease in the net  investment  in financing
leases since December 31, 1998. The Partnership  owned  financing  leases with a
net  investment  of $0 at December 31, 1999, as compared to $351,000 at December
31, 1998. The net investment in financing leases is amortized to income over the
life of the lease until the net investment is $0 using the interest method

         Interest income from notes receivable decreased by $66,000 for the year
ended December 31, 1999,  compared to 1998. The decrease in interest income from
notes  receivable,  for the year ended  December 31, 1999,  compared to 1998, is
attributable  to the  decline in net  investment  in notes  receivable.  The net
investment  in notes  receivable  was $61,000 at December 31, 1999,  compared to
$271,000 at December 31, 1998.

         Earnings  from joint  ventures  decreased by $98,000 for the year ended
December 31, 1999,  compared to 1998.  The decrease was due to one joint venture
experiencing  a loss from sale of  equipment,  as well as another  joint venture
experiencing a reduction in rental income.

         The  Partnership  reported a gain on sale of securities of $473,000 for
the year ended  December 31, 1999,  compared to $4,000 in 1998.  The  securities
sold for both 1999 and 1998  consisted  of common  stock  received  through  the
exercise  of stock  warrants  granted to the  Partnership  as part of  financing
agreements  with  emerging  growth  companies  that  are  publicly  traded.  The
Partnership  received  proceeds  of  $473,000  and $4,000 from the sale of these
securities  during the year ended December 31, 1999 and 1998,  respectively.  In
addition,  at December 31, 1999, the Partnership  owns shares of stock and stock
warrants  in  emerging  growth  companies  that  are  publicly  traded  with  an
unrealized gain of  approximately  $9,000.  These stock warrants contain certain
restrictions, but are generally exercisable within one year.

         Total expenses of the Partnership decreased by $441,000 during the year
ended  December 31, 1999,  compared to the same period in the previous year. All
expense items  decreased,  with  depreciation  expense  contributing the largest
decline.  Depreciation expense decreased by $192,000 for the year ended December
31, 1999 as compared to the same period in 1998.  The  decrease in  depreciation
expense is primarily due to the decrease in the amount of equipment owned by the
Partnership,  as well as, the equipment  portfolio having been fully depreciated
during the year ended December 31, 1999.

         Inflation  affects the  Partnership  in relation to the current cost of
equipment  placed on lease and the residual  values  realized when the equipment
comes  off-lease and is sold.  During the last several years  inflation has been
low, thereby having very little impact upon the investments of the Partnership.

Liquidity and Capital Resources

         The   Partnership's   primary  source  of  liquidity   comes  from  its
contractual  obligations  with a diversified  group of lessees and borrowers for
fixed lease terms at fixed  payment  amounts.  As the initial lease terms of the
Partnership's  short term operating leases expire, the Partnership will re-lease
or sell the equipment.  The future liquidity of the Partnership will depend upon
the General Partner's success in collecting its contractually  owed amounts from

                                       6
<PAGE>

lessees and  borrowers  as well as  re-leasing  and  selling  the  Partnership's
equipment when the lease terms expire.

         The  Partnership  reported net cash generated by equipment  leasing and
financing  activities  for the year ended December 31, 1999 and 1998 of $940,000
and $3,309,000, respectively. The decline in net cash generated from leasing and
financing  activities for the years ended December 31, 1999 is  attributable  to
decreases  in rental  income from  operating  leases,  principal  payments  from
financing  leases and principal  payments from notes  receivable,  as previously
discussed in the Results of Operations.

         The Partnership received  distributions from joint ventures of $160,000
and $356,000 for the year ended  December 31, 1999 and 1998,  respectively.  The
decrease in distributions  from joint ventures,  for the year ended December 31,
1999,  is  attributable  to one joint  venture  experiencing  a decline  in cash
available  for  distributions  as a result of a reduction  in rental  income and
sales proceeds received.

         As of December 31, 1999, the Partnership owned equipment being held for
lease with an original  cost of $418,000 and a net book value of $0, as compared
to equipment with an original cost of $2,859,000 and a net book value of $31,000
at December 31, 1998. The General Partner is actively engaged,  on behalf of the
Partnership,  in remarketing and selling the  Partnership's off lease equipment.
Until new  lessees  or buyers of  equipment  can be found,  the  equipment  will
continue to generate  depreciation  expense  without  any  corresponding  rental
income.  The  effect of this will be a  reduction  of the  Partnership  earnings
during this remarketing period.

         The cash  distributed to partners was $4,383,000 and $3,361,000 for the
years ended  December 31, 1999 and 1998,  respectively.  In accordance  with the
Partnership  Agreement,  the limited  partners  are  entitled to 95% of the cash
available  for  distribution  and the  General  Partner is  entitled to 5%. As a
result,  the  limited  partners  received  $4,383,000  and  $3,193,000  in  cash
distributions for the years ended December 31, 1999 and 1998, respectively.  The
cumulative cash distributions to limited partners is $43,274,000 at December 31,
1999 and  1998.  The  General  Partner  received  cash  distributions  of $0 and
$168,000 for its share of the cash distribution for the years ended December 31,
1999 and 1998,  respectively.  The  Partnership  made its next  distribution  in
January of 2000.

         As provided for by the partnership  agreement,  the General Partner has
determined  to  exercise  its  discretion  that no  further  redemptions  in the
Partnership will be permitted after March 31, 1998.

         The cash to be  generated  from  leasing and  financing  operations  is
anticipated to be sufficient to meet the  Partnership's  continuing  operational
expenses and to provide cash distributions to the Partners.

         Forward-looking statements in this report are made pursuant to the safe
harbor  provisions  of the  Private  Securities  Litigation  Reform Act of 1995.
Actual  results could differ from those  anticipated  by some of the  statements
made above. Limited Partners are cautioned that such forward-looking  statements
involve risks and uncertainties including without limitation the following:  (I)
the  Partnership's  plans are subject to change at any time at the discretion of
the General Partner of the Partnership,  (ii) future technological  developments
in the industry in which the Partnership operates, (iii) competitive pressure on
pricing or services,  (iv) substantial  customer defaults or cancellations,  (v)
changes  in  business  conditions  and the  general  economy,  (vi)  changes  in
government regulations affecting the Partnership's core businesses and (vii) the
ability of the Partnership to sell its remaining assets .

Impact of the Year 2000 Issue

         The  General  Partner  has  appointed  ResourcePhoenix.com.  (RPC),  an
affiliate of the General Partner, to manage its Year 2000 project.

         RPC has a Year 2000 project plan in place and a "Y2K Project  Team" has
been appointed.  The team has identified risks, and has implemented  remediation
procedures for its Year 2000 issues. RPC has budgeted for the necessary changes,
built  contingency  plans,  and has  progressed  along the  scheduled  timeline.
Installation  of all remediation  changes to critical  software and hardware was
completed  on November 5, 1999.  As of January 31, 2000 RPC has not  encountered
any material year 2000  problems with the hardware and software  systems used in
our operations.  In addition,  none of RPC's critical  vendors have reported any
material  year 2000  problems nor have they  experienced  any decline in service
levels from such vendors.

         RPC will continue to monitor  internal and external  issues  related to
year 2000.

                                       7
<PAGE>

         Costs incurred by the Partnership  will be expenses as incurred and are
not currently anticipated to be material to the Partnership's financial position
or results of operations.

         The  Partnership's  customers  consist of lessees  and  borrowers.  The
Partnership  does  not have  exposure  to any  individual  customer  that  would
materially impact the Partnership  should the customer  experience a significant
Year 2000 problem.

                                       8
<PAGE>

                          Item 7. FINANCIAL STATEMENTS
                                  --------------------

                            PHOENIX INCOME FUND, L.P.
                            -------------------------

                          YEAR ENDED DECEMBER 31, 1999
                          ----------------------------


                                       9
<PAGE>


                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
                    ----------------------------------------

To the Partners of Phoenix Income Fund, L.P.:

We have audited the  accompanying  balance sheet of Phoenix Income Fund, L.P. (a
California  limited  partnership)  as of  December  31,  1999,  and the  related
statements of operations and  comprehensive  income,  partners' capital and cash
flows for the years ended December 31, 1999 and 1998. These financial statements
are the responsibility of the Partnership's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Phoenix Income Fund, L.P. as of
December 31, 1999 and the results of its  operations  and its cash flows for the
years ended December 31, 1999 and 1998, in conformity  with  generally  accepted
accounting principles.



San Francisco, California,                                   ARTHUR ANDERSEN LLP
  January 26, 2000


                                       10
<PAGE>


                             PHOENIX INCOME FUND, L.P.
                                  BALANCE SHEET
                 (Amounts in Thousands Except for Unit Amounts)

                                                          December 31, 1999
                                                          -----------------

ASSETS

Cash and cash equivalents                                   $     388

Accounts receivable (net of allowance for losses on
   accounts receivable of $19)                                     26

Notes receivable                                                   61

Equipment on operating leases and held for lease
   (net of accumulated depreciation of $636)                      -

Investment in joint ventures                                       32

Capitalized acquisition fees (net of accumulated
   amortization of $3,622)                                        -

Other assets                                                        8
                                                            ---------

     Total Assets                                           $     515
                                                            =========

LIABILITIES AND PARTNERS' CAPITAL

Liabilities:

   Accounts payable and accrued expenses                    $      70
                                                            ---------

     Total Liabilities                                             70
                                                            ---------
Partners' Capital:

   General Partner                                                -

   Limited Partners, 300,000 units authorized, 175,285
     units issued and 169,587 units outstanding                   436

   Accumulated other comprehensive income                           9
                                                            ---------

     Total Partners' Capital                                      445
                                                            ---------

     Total Liabilities and Partners' Capital                $     515
                                                            =========

        The accompanying notes are an integral part of these statements.


                                       11
<PAGE>

                            PHOENIX INCOME FUND, L.P.
                STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
               (Amounts in Thousands Except for Per Unit Amounts)

                                                For the Years Ended December 31,
                                                         1999      1998
                                                         ----      ----
INCOME

   Rental income                                       $   520   $ 1,480
   Earned income, financing leases                          26       193
   Gain on sale of securities                              473         4
   Equity in earnings from joint ventures                   77       175
   Interest income, notes receivable                        49       115
   Other income                                            202       131
                                                       -------   -------

     Total Income                                        1,347     2,098
                                                       -------   -------

EXPENSES

   Depreciation                                              5       197
   Amortization of acquisition fees                         28        88
   Lease related operating expenses                         14        44
   Management fees to General Partner                       57       128
   Reimbursed administrative costs to General Partner       67        86
   Provision for (recovery of) losses on receivables       (33)       10
   General and administrative expenses                      75       101
                                                       -------   -------

     Total Expenses                                        213       654
                                                       -------   -------

NET INCOME                                               1,134     1,444

Other comprehensive income:
   Unrealized gains (losses) on securities:
     Unrealized holding gains (losses) arising
       during period                                        467        (7)
     Less:  reclassification adjustment for
       gains included in net income                        (473)       (4)
                                                       -------   -------

Other comprehensive income (loss)                           (6)      (11)
                                                       -------   -------

COMPREHENSIVE INCOME                                   $ 1,128   $ 1,433
                                                       =======   =======

NET INCOME PER LIMITED
   PARTNERSHIP UNIT                                    $  6.69   $  7.52
                                                       =======   =======

ALLOCATION OF NET INCOME:
   General Partner                                     $  --     $   168
   Limited Partners                                      1,134     1,276
                                                       -------   -------

                                                       $ 1,134   $ 1,444
                                                       =======   =======

       The accompanying notes are an integral part of these statements.

                                       12
<PAGE>


                            PHOENIX INCOME FUND, L.P.
                         STATEMENTS OF PARTNERS' CAPITAL
                 (Amounts in Thousands Except for Unit Amounts)
<TABLE>
<CAPTION>

                                                                        Accumulated
                                       General                             Other
                                       Partner's   Limited Partners'   Comprehensive   Total
                                        Amount     Units       Amount     Income       Amount
                                       ---------   ------------------  -------------   ------

<S>                                    <C>         <C>       <C>        <C>          <C>
Balance, December 31, 1997             $   --      169,972   $  5,604   $     26     $  5,630

Redemptions of capital                     --         (368)        (2)      --             (2)

Distributions to partners ($18.82 per
   limited partnership unit)               (168)      --       (3,193)      --         (3,361)

Other comprehensive income                 --         --         --          (11)         (11)

Net income                                  168       --        1,276       --          1,444
                                       --------   --------   --------   --------     --------

Balance, December 31, 1998                 --      169,604      3,685         15        3,700

Redemptions of capital                     --          (17)      --         --           --

Distributions to partners ($25.85 per
   limited partnership unit)               --         --       (4,383)      --         (4,383)

Other comprehensive income                 --         --         --           (6)          (6)

Net income                                 --         --        1,134       --          1,134
                                       --------   --------   --------   --------     --------

Balance, December 31, 1999             $   --      169,587   $    436   $      9     $    445
                                       ========    =======   ========   ========     ========
</TABLE>

       The accompanying notes are an integral part of these statements.

                                       13
<PAGE>


                            PHOENIX INCOME FUND, L.P.
                            STATEMENTS OF CASH FLOWS
                             (Amounts in Thousands)

                                                For the Years Ended December 31,
                                                         1999        1998
                                                         ----        ----
Operating Activities:
--------------------

   Net income                                          $ 1,134     $ 1,444
   Adjustments to reconcile net income to net
     cash provided by operating activities:
       Depreciation                                          5         197
       Amortization of acquisition fees                     28          88
       Gain on sale of equipment                           (93)        (51)
       Gain on sale of securities                         (473)         (4)
       Equity in earnings from joint ventures              (77)       (175)
       Provision for early termination, financing
         leases                                              2          19
       Recovery of losses on accounts receivable           (41)         (9)
       Provision for losses on notes receivable              6        --
       Decrease in accounts receivable                      39         192
       Decrease in accounts payable and accrued
         expenses                                         (143)       (295)
       Decrease in other assets                             24           5
                                                       -------     -------

   Net cash provided by operating activities               411       1,411
                                                       -------     -------

Investing Activities:
--------------------

   Principal payments, financing leases                    325       1,357
   Principal payments, notes receivable                    204         541
   Proceeds from sale of equipment                         148          51
   Proceeds from sale of securities                        473           4
   Distributions from joint ventures                       160         356
                                                       -------     -------

   Net cash provided by investing activities             1,310       2,309
                                                       -------     -------

Financing Activities:
--------------------

   Distributions to partners                            (4,383)     (3,361)
   Redemptions of capital                                 --            (2)
                                                       -------     -------

   Net cash used in financing activities                (4,383)     (3,363)
                                                       -------     -------

Increase (decrease) in cash and cash equivalents        (2,662)        357

Cash and cash equivalents, beginning of period           3,050       2,693
                                                       -------     -------

Cash and cash equivalents, end of period               $   388     $ 3,050
                                                       =======     =======


       The accompanying notes are an integral part of these statements.

                                       14
<PAGE>

                            PHOENIX INCOME FUND, L.P.

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 1999


Note 1.       Organization and Partnership Matters.
              ------------------------------------

         Phoenix  Income  Fund,  L.P.  (the   "Partnership")  was  formed  as  a
California limited  partnership on November 17, 1989. The Partnership's  primary
business  objectives  are to  invest  in  computer,  computer-related  and other
equipment and assets of various types and to lease or finance such  equipment to
third  parties.  In addition to acquiring  equipment for lease to third parties,
the  Partnership  may also  provide  financing  to cable  television  operators,
emerging  growth  companies,  and certain  manufacturers  and their lessees with
respect to equipment leased directly by such manufacturers.  The Partnership met
minimum   investment   requirements   on  February  21,  1991.  The  Partnership
termination date is December 31, 2006.

         The  Partnership  has also  made  investments  in joint  ventures  with
affiliated  partnerships  managed  by the  General  Partner  for the  purpose of
reducing the risks of financing or acquiring certain capital equipment leased to
third parties (see Note 6).

         For  financial  reporting  purposes,  as more  fully  described  in the
Partnership  Agreement,  net income shall be allocated as follows: (a) first, to
Phoenix  Leasing  Associates  LP  (the  "General  Partner")  to  the  extent  of
cumulative  distributions to the General Partner,  (b) second, 1% to the General
Partner to the extent of cumulative syndication expenses and Partnership losses,
and (c) the balance, if any, to the Limited Partners.  Losses shall be allocated
1% to the General Partner and 99% to the Limited Partners.  Syndication expenses
shall be allocated 1% to the General Partner and 99% to the Limited Partners.

         The General Partner is entitled to receive 5% of all cash distributions
until the Limited  Partners have recovered their initial  capital  contributions
plus a cumulative return of 10% per annum, calculated quarterly. Thereafter, the
General Partner will receive 15% of all cash distributions.

         In the event the General  Partner has a deficit  balance in its capital
account  at the  time  of  partnership  liquidation,  it  will  be  required  to
contribute the amount of such deficit to the Partnership.

         As compensation for management services, the General Partner receives a
fee  payable  quarterly,  in  an  amount  equal  to  3.5%,  subject  to  certain
limitations, of the Partnership's gross revenues for the quarter from which such
payment is being made,  which revenues  shall  include,  but are not limited to,
rental  receipts,  maintenance  fees,  proceeds  from the sale of equipment  and
interest income.

         The General  Partner  will be  compensated  for  services  performed in
connection  with the  analysis  of  assets  available  to the  Partnership,  the
selection  of such  assets  and the  acquisition  thereof,  including  obtaining
lessees for the equipment,  negotiating and concluding  master lease  agreements
with certain lessees. As compensation for such acquisition services, the General
Partner will receive a fee equal to 4%, subject to certain  limitations,  of (a)
the purchase price of equipment acquired by the Partnership, or equipment leased
to  customers  by  manufacturers,  the  financing  for which is  provided by the
Partnership,  or (b) financing  provided to businesses such as cable  operators,
emerging growth companies, or other businesses, payable upon such acquisition or
financing,  as the case may be.  Acquisition fees are amortized over the life of
the assets principally on a straight-line basis.

         A schedule of compensation  due and  distributions  made to the General
Partner for the years ended December 31 follows:

                                      1999              1998
                                      ----              ----
                                      (Amounts in Thousands)

         Management fees             $   57            $  128
         Cash distributions             -                 168
                                     ------            ------

              Total                  $   57            $  296
                                     ======            ======


                                       15
<PAGE>

     Redemptions  of  Limited  Partner  units  will  only be made to the  extent
permitted by applicable laws and regulations,  the Partnership Agreement and if,
in the  opinion  of the  General  Partner,  it is in the  best  interest  of the
Partnership. In addition, redemptions will not be made if such redemptions would
cause the  Partnership to be categorized as a publicly  traded  partnership  for
federal  income tax  purposes.  As provided by the  partnership  agreement,  the
General  Partner has  determined  to  exercise  its  discretion  that no further
redemptions in the Partnership will be permitted after March 31, 1998.

         The  Partnership  will acquire such  limited  partnership  units for an
amount  equal to 85% of the  "accrual  basis  capital  account"  relating to the
redeemed units.  The  Partnership  will retain the remaining 15% of the "accrual
basis capital  account"  relating to the redeemed  units.  No  redemptions  were
retained by the  Partnership  during the years ended December 31, 1999 and 1998;
however, during the year ended December 31, 1999 seventeen units were abandoned.
"Accrual  basis capital  account" is computed in  accordance  with the books and
records  regularly   maintained  by  the  Partnership  for  financial  reporting
purposes, utilizing the accrual method of accounting.


Note 2.       Summary of Significant Accounting Policies.
              ------------------------------------------

         Cash and Cash Equivalents.  Cash and cash equivalents includes deposits
at banks,  investments in money market funds and other highly liquid  short-term
investments with original maturities of less than 90 days.

         Credit  and  Collateral.   The   Partnership's   activities  have  been
concentrated  in  the  equipment  leasing  and  financing  industry.   A  credit
evaluation  is performed  by the General  Partner for all leases and loans made,
with  the  collateral  requirements  determined  on a  case-by-case  basis.  The
Partnership's  loans are generally  secured by the equipment or assets  financed
and, in some cases,  other collateral of the borrower.  In the event of default,
the  Partnership  has the right to foreclose upon the collateral  used to secure
such loans.

         Notes  Receivable.  Notes  receivable  generally  are  stated  at their
outstanding unpaid principal balances, which includes accrued interest. Interest
income is accrued on the unpaid principal balance.

         Impaired Notes Receivable.  Generally,  notes receivable are classified
as impaired and the accrual of interest on such notes are discontinued  when the
contractual  payment of  principal  or  interest  has become 90 days past due or
management has serious doubts about further  collectibility  of the  contractual
payments,  even  though  the  loan  may  currently  be  performing.  When a note
receivable is classified as impaired,  income  recognition is discontinued.  Any
payments  received  subsequent  to the  placement of the note  receivable  on to
impaired  status  will  generally  be  applied  towards  the  reduction  of  the
outstanding  note  receivable  balance,  which may  include  previously  accrued
interest as well as principal.  Once the principal and accrued  interest balance
has been reduced to zero,  the  remaining  payments  will be applied to interest
income.  Generally,  notes  receivable  are restored to accrual  status when the
obligation is brought current,  has performed in accordance with the contractual
terms for a  reasonable  period of time and the ultimate  collectibility  of the
total contractual principal and interest is no longer in doubt.

         Allowance for Losses.  An allowance for losses is  established  through
provisions for losses charged  against  income.  Notes  receivable  deemed to be
uncollectible  are charged  against the  allowance  for losses,  and  subsequent
recoveries, if any, are credited to the allowance.

         Leasing  Operations.  The Partnership's  leasing  operations consist of
both  financing and operating  leases.  The financing  method of accounting  for
leases records as unearned  income at the inception of the lease,  the excess of
net rentals  receivable  and  estimated  residual  value at the end of the lease
term, over the cost of equipment  leased.  Unearned income is credited to income
monthly  over  the  term  of the  lease  on a  declining  basis  to  provide  an
approximate  level  rate of return on the  unrecovered  cost of the  investment.
Initial direct costs of consummating  new leases are capitalized and included in
the cost of equipment.  The Partnership  reviews its estimates of residual value
at least  annually.  If a decline  in value  has  occurred  which is other  than
temporary, a reduction in the investment is recognized currently.

         Under the  operating  method  of  accounting  for  leases,  the  leased
equipment  is recorded as an asset at cost and  depreciated.  The  Partnership's
leased  equipment is depreciated  primarily  using an  accelerated  depreciation
method over the estimated useful life of six years,  except for equipment leased
under vendor agreements,  which is depreciated on a straight-line basis over the
estimated useful life, ranging up to six years.

                                       16
<PAGE>

     The  Partnership's  policy is to review  periodically the expected economic
life of its rental equipment in order to determine the probability of recovering
its  undepreciated  cost. Such reviews address,  among other things,  recent and
anticipated   technological   developments   affecting  computer  equipment  and
competitive  factors  within  the  computer  marketplace.  Where  reviews of the
equipment  portfolio  indicate that rentals plus anticipated sales proceeds will
not exceed  expenses  in any future  period,  the  Partnership  will  revise its
depreciation policy and provide for additional depreciation as appropriate.

         Rental income for the year is determined  on a  straight-line  basis of
rental  payments due for the period  under the terms of the lease.  Maintenance,
repairs and minor renewals of the leased equipment are charged to expense.

         Portfolio  Valuation  Methodology.  The Partnership  uses the portfolio
method of accounting for the net realizable value of the Partnership's equipment
portfolio.

         Investment  in  Joint  Ventures.  Investments  in  net  assets  of  the
equipment,  financing and foreclosed  cable systems joint  ventures  reflect the
Partnership's  equity  basis  in  the  ventures.  Under  the  equity  method  of
accounting,  the  original  investment  is  recorded  at  cost  and is  adjusted
periodically  to recognize the  Partnership's  share of earnings,  losses,  cash
contributions and cash distributions after the date of acquisition.

         Investment  in  Available-for-Sale   Securities.  The  Partnership  has
investments in stock warrants in public  companies that have been  determined to
be available for sale.  Available-for-sale  securities  are stated at their fair
market  value,   with  the  unrealized   gains  and  losses  reported  as  other
comprehensive income.

         Reclassification.  Certain  1998  amounts  have  been  reclassified  to
conform to the 1999 presentation.

         Use of Estimates. The preparation of financial statements in conformity
with  generally  accepted  accounting  principles  requires  management  to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements  and the  reported  amounts of revenues  and expenses
during the reporting period. Actual results could differ from those estimates.

         Comprehensive  Income.  As of January 1, 1998, the Partnership  adopted
Statement of Financial  Accounting  Standards No. 130, "Reporting  Comprehensive
Income" (SFAS 130). This statement  establishes  standards for the reporting and
display of comprehensive income and its components in the financial  statements.
For the  Partnership,  comprehensive  income includes net income reported on the
statement of operations and changes in the fair value of its  available-for-sale
investments reported as a component of partners' capital.


Note 3.       Accounts Receivable.
              -------------------

         Accounts receivable consist of the following at December 31:

                                                                   1999
                                                                   ----
                                                          (Amounts in Thousands)

         Property and sales taxes                                  $ 26
         Lease payments                                              18
         Interest                                                     1
                                                                   ----
                                                                     45
         Less:  allowance for losses on accounts receivable         (19)
                                                                   ----
           Total                                                   $ 26
                                                                   ====

                                       17
<PAGE>

Note 4.       Notes Receivable.
              ----------------

         Notes receivable consist of the following at December 31:

                                                                   1999
                                                                   ----
                                                          (Amounts in Thousands)

         Notes receivable from other businesses with
           stated interest ranging from 17% to 25% per
           annum, receivable in installments ranging from
           37 to 60 months, collateralized by the equipment
           financed.                                               $ 61
                                                                   ----

           Total                                                   $ 61
                                                                   ====

         Minimum payments to be received on non-cancelable  notes receivable for
the years ended December 31, are as follows:

                                                          (Amounts in Thousands)

         2000 ..............................................      $  1
         2001 ..............................................        14
                                                                  ----

         Total minimum payments to be received .............        15
         Impaired notes receivable .........................        48
         Less:  unearned interest ..........................        (2)
                                                                  ----

         Net investment in notes receivable ................      $ 61
                                                                  ====

         At  December  31,  1999,  the  recorded  investment  in notes  that are
considered to be impaired was $48,000, net of specific write-downs.  The average
recorded  investment in impaired  loans during the years ended December 31, 1999
and 1998 was approximately $67,000 and $106,000,  respectively.  The Partnership
recognized  $25,000 and $6,000 of interest  income on impaired notes  receivable
during the years ended December 31, 1999 and 1998, respectively.

         The activity in the allowance for losses on notes receivable during the
year ended December 31, is as follows:

                                                              1999       1998
                                                              ----       ----
                                                          (Amounts in Thousands)

         Beginning balance                                    $ 162     $ 162
           Provision for losses                                   6       --
           Write downs                                         (168)      --
                                                              -----     -----
         Ending balance                                       $ --      $ 162
                                                              =====     =====

Note 5.    Equipment on Operating Leases.
           -----------------------------

         Equipment on lease consists primarily of computer peripheral  equipment
and other capital equipment.

         The  Partnership's  operating  leases are for  initial  lease  terms of
approximately 24 to 48 months.  During the remaining terms of existing operating
leases  the  Partnership  will not  recover  all of the  undepreciated  cost and
related expenses of its rental equipment,  and therefore must remarket a portion
of its equipment in future years.

         The  Partnership  has  entered  into  direct  lease  arrangements  with
businesses  in  different  industries,  located  throughout  the United  States.
Generally,  it is the  responsibility  of the lessee to provide  maintenance  on
leased  equipment.  The General Partner  administers the equipment  portfolio of
leases acquired through the direct leasing program.  Administration includes the
collection of rents from the lessees and remarketing of the equipment.


                                       18
<PAGE>

         Minimum rentals to be received on  noncancellable  operating leases for
the years ended December 31 are as follows:

                                                                Operating
                                                                ---------
                                                          (Amounts in Thousands)

         2000 .................................................   $   1
         2001 .................................................     --
         2002 .................................................     --
         2003 .................................................     --
                                                                    --
                                                                  -----

         Totals ...............................................   $   1
                                                                  =====


Note 6.       Investment in Joint Ventures.
              ----------------------------

Equipment Joint Venture
-----------------------

         On August 1, 1994,  the  Partnership  entered into an agreement,  along
with two other affiliated partnerships,  to contribute certain leased assets and
notes receivable (the Assets) to Phoenix Acceptance Limited Liability Company, a
Delaware  limited  liability  company  (the "Joint  Venture")  in exchange for a
22.55% equity interest in the Joint Venture.  The interest received in the Joint
Venture  was  accounted  for  at  the  historical   cost  basis  of  the  Assets
transferred.  The Partnership has accounted for its net investment in this Joint
Venture using the equity method of  accounting.  The Joint Venture was organized
to hold title to the assets and subsequently transfer such assets to a trust for
the purpose of the trust  issuing two classes of lease  backed  certificates  to
third parties in exchange for cash proceeds.  The transaction  between the Joint
Venture and the trust has been  accounted  for as a financing  arrangement.  The
Joint Venture retains a residual interest in the assets transferred  through the
ownership of a third class of subordinated trust certificates.  The lease backed
certificates  are  recourse  only  to  the  assets  used  to  collateralize  the
obligation.

         The net carrying value of the Assets  contributed by the Partnership to
the Joint Venture was approximately $5.6 million and the total carrying value of
all of the  assets  contributed  by all three  partnerships  approximated  $24.7
million. The net proceeds from the issuance of the lease backed certificates are
being distributed back to the partnerships who contributed to the Joint Venture.
On August 5, 1994, the Joint Venture received  proceeds from the issuance of the
7.1% Class A lease backed certificates in the principal amount of $18.5 million.
On August 12, 1994, the Joint Venture received proceeds from the issuance of the
8.25% Class B lease backed certificates in the principal amount of $5.3 million.
The lease backed certificates were paid in full in November 1996.

         The manager of the Joint Venture is Phoenix Leasing  Incorporated,  who
is responsible for the daily  management of the operations of the Joint Venture.
Phoenix  Leasing  Incorporated  also acts as Servicer and  Administrator  to the
trust. As Servicer,  Phoenix Leasing  Incorporated is responsible for servicing,
managing  and  administering  the  Assets,  as  well  as  enforcing  and  making
collections on the Assets.

         An analysis of the  Partnership's  investment  account in the equipment
joint venture is as follows:

                                                                         Net
                 Net Investment                                      Investment
                  at Beginning               Equity in                 at End
Date               of Period   Contributions Earnings  Distributions  of Period
----             ------------- ------------- --------- -------------  ---------
                                      (Amounts in Thousands)

Year Ended
  December 31, 1998   $ 126         $   0       $ 159       $ 273       $  12
                      =====         =====       =====       =====       =====

Year Ended
  December 31, 1999   $  12         $   0       $ 119      $   99       $  32
                      =====         =====       =====       =====       =====


                                       19
<PAGE>

         The aggregate  financial  information of the equipment joint venture is
presented as follows:

                                                      December 31, 1999
                                                      -----------------
                                                   (Amounts in Thousands)

         Assets                                            $ 177
         Liabilities                                          35
         Partners' Capital                                   142

                                               For the Years Ended December 31,
                                                     1999            1998
                                                     ----            ----
                                                     (Amounts in Thousands)

         Revenue                                    $  586          $  766
         Expenses                                       72              59
         Net Income                                    514             707

         The General Partner earns a management fee of 3.5% of the Partnership's
respective  interest in the gross receipts of the Joint  Venture.  Cash proceeds
subject  to a  management  fee at the joint  venture  level are not  subject  to
management fees at the Partnership level.

Financing Joint Venture
-----------------------

         The Partnership owned a 25% interest in Phoenix Joint Venture 1994-2, a
financing  joint  venture.  This joint  venture  was  closed  during  1999.  The
investment  was accounted for using the equity method of  accounting.  The other
partners  of the  venture  were  entities  organized  and managed by the General
Partner.

         An analysis of the  Partnership's  investment  account in the Financing
Joint Venture is as follows:

                                                                         Net
                 Net Investment               Equity in               Investment
                  at Beginning                Earnings                 at End
Date               of Period   Contributions  (Losses) Distributions  of Period
----             ------------- -------------  -------- -------------  ---------
                                      (Amounts in Thousands)

Year Ended
  December 31, 1998   $ 170         $   0       $  16       $  83       $ 103
                      =====         =====       =====       =====       =====

Year Ended
  December 31, 1999   $ 103         $   0       $ (42)      $  61       $   0
                      =====         =====       =====       =====       =====

         The aggregate  financial  information of the Financing Joint Venture is
presented as follows:


                                                For the Years Ended December 31,
                                                      1999            1998
                                                      ----            ----
                                                     (Amounts in Thousands)

         Revenue                                      $   2           $  85
         Expenses                                       155              17
         Net Income (Loss)                             (153)             68


         The  General   Partner   earned  a  management   fee  of  3.5%  of  the
Partnership's  respective  interest in gross payments received for the financing
joint venture.  Revenues  subject to a management fee at the joint venture level
were not subject to management fees at the Partnership level.


                                       20
<PAGE>

Note 7.       Accounts Payable and Accrued Expenses.
              -------------------------------------

         Accounts  payable  and accrued  expenses  consist of the  following  at
December 31:

                                                                  1999
                                                                  ----
                                                          (Amounts in Thousands)

         Equipment lease operations                               $ 30
         Other                                                      26
         General Partner and affiliates                             13
         Security deposits                                           1
                                                                  ----

              Total                                               $ 70
                                                                  ====


Note 8.       Income Taxes.
              ------------

         Federal  and state  income tax  regulations  provide  that taxes on the
income  or loss of the  Partnership  are  reportable  by the  partners  in their
individual income tax returns. Accordingly, no provision for such taxes has been
made in the accompanying financial statements.

         The net differences  between the tax basis and the reported  amounts of
the Partnership's assets and liabilities are as follows at December 31, 1999:

                              Reported Amounts    Tax Basis      Net Difference
                              ----------------    ---------      --------------
                                            (Amounts in Thousands)

         Assets                     $ 515          $ 802          $ (287)
         Liabilities                   70             49              21


Note 9.       Related Entities.
              ----------------

         The  General  Partner  is a  California  limited  partnership,  Phoenix
Leasing  Associates  LP,  the  general  partner  of  which  is  Phoenix  Leasing
Associates,  Inc., a Nevada corporation and a wholly-owned subsidiary of Phoenix
Leasing  Incorporated.  Phoenix  Leasing  Incorporated  is or has been a general
partner in other  limited  partnerships  formed to make  investments  in capital
equipment and to engage in the leasing and financing business.


Note 10.      Reimbursed Costs to the General Partner and Affiliates.
              ------------------------------------------------------

         The General Partner and affiliates incur certain  administrative  costs
such  as  data   processing,   investor   and   lessee   communications,   lease
administration,  accounting,  equipment storage and equipment remarketing, which
is reimbursed by the Partnership. These expenses incurred by the General Partner
and  affiliates  are to be  reimbursed  at the lower of the  actual  costs or an
amount equal to 90% of the fair market value for such services.

         The reimbursed administrative costs to the General Partner were $67,000
and $86,000 for the years ended  December 31, 1999 and 1998,  respectively.  The
equipment  storage,  remarketing  and data  processing  costs  reimbursed to the
General  Partner  during the years ended December 31, 1999 and 1998 were $15,000
and $42,000, respectively.

         In  addition,  the General  Partner  receives a  management  fee and an
acquisition fee (see Note 1).


Note 11.      Net Income (Loss) and Distributions per Limited Partnership Unit.
              ----------------------------------------------------------------

         Net income and distributions per limited partnership unit were based on
the limited  partners' share of net income and  distributions,  and the weighted
average  number of units  outstanding of 169,587 and 169,677 for the years ended
December  31, 1999 and 1998,  respectively.  For purposes of  allocating  income

                                       21
<PAGE>

(loss) and  distributions to each individual  limited  partner,  the Partnership
allocates net income (loss) and distributions based upon each respective limited
partner's net capital contributions.


Note 12.      Fair Value of Financial Instruments.
              -----------------------------------

         The carrying  amounts  reported on the balance  sheet for cash and cash
equivalents,  available-for-sale  securities  and notes  receivable  approximate
their fair value.

                                       22
<PAGE>

Item 8.       Disagreements on Accounting and Financial Disclosure Matters.
              ------------------------------------------------------------

         None.

                                    PART III

Item 9.       Directors and Executive Officers of the Registrant.
              --------------------------------------------------

         The  registrant  is  a  limited  partnership  and,  therefore,  has  no
executive  officers or  directors.  The  General  Partner of the  Registrant  is
Phoenix Leasing Associates LP, a California limited  partnership,  the Corporate
General  Partner  of  which  is  Phoenix  Leasing  Associates,  Inc.,  a  Nevada
corporation  and a wholly-owned  subsidiary of Phoenix Leasing  Incorporated,  a
California  corporation  (PLI). The directors and executive  officers of Phoenix
Leasing Associates, Inc. (PLA) are as follows:

         GUS  CONSTANTIN,  age 62,  is  President  and a  Director  of PLA.  Mr.
Constantin received a B.S. degree in Engineering from the University of Michigan
and a Master's Degree in Management Science from Columbia University.  From 1969
to 1972,  he  served  as  Director,  Computer  and  Technical  Equipment  of DCL
Incorporated  (formerly  Diebold Computer Leasing  Incorporated),  a corporation
formerly  listed on the  American  Stock  Exchange,  and as Vice  President  and
General  Manager of DCL Capital  Corporation,  a wholly-owned  subsidiary of DCL
Incorporated.  Mr.  Constantin  was actively  engaged in marketing  manufacturer
leasing  programs  to  computer  and  medical  equipment  manufacturers  and  in
directing DCL Incorporated's IBM System/370 marketing activities. Prior to 1969,
Mr.  Constantin was employed by IBM as a data  processing  systems  engineer for
four years.  Mr.  Constantin  is an  individual  general  partner in four active
partnerships and is an NASD registered principal.  Mr. Constantin is the founder
of PLI and the beneficial  owner of all of the common stock of Phoenix  American
Incorporated.

         GARY W.  MARTINEZ,  age 49, is Senior Vice  President and a Director of
PLA. He has been associated with PLI since 1976. He manages the Asset Management
Department,  which is responsible for lease and loan portfolio management.  This
includes credit analysis,  contract terms, documentation and funding; remittance
application,  change processing and maintenance of customer  accounts;  customer
service, invoicing,  collection,  settlements and litigation;  negotiating lease
renewals,  extensions,  sales and buyouts; and management information reporting.
From 1973 to 1976, Mr.  Martinez was a Loan Officer with Crocker  National Bank,
San  Francisco.  Prior to 1973,  he was an Area Manager with  Pennsylvania  Life
Insurance  Company.  Mr. Martinez is a graduate of California State  University,
Chico.

         HOWARD SOLOVEI, age 38, is the Chief Financial Officer, Treasurer and a
Director  of PLA.  He has been  associated  with PLI  since  1984.  Mr.  Solovei
oversees  the  Finance  Department.  He  is  responsible  for  the  structuring,
planning,  and monitoring of the  partnerships  sponsored by the General Partner
and its  affiliates,  as well as  maintaining  the  banking  relationships.  Mr.
Solovei graduated with a B.S. in Business  Administration from the University of
California, Berkeley.

         Neither the General  Partner nor any  Executive  Officer of the General
Partner has any family relationship with the others.

         Phoenix  Leasing  Incorporated  or its  affiliates  and  the  executive
officers of the General  Partner  serve in a similar  capacity to the  following
affiliated limited partnerships:

              Phoenix Leasing American Business Fund, L.P.
              Phoenix Leasing Cash Distribution Fund V, L.P. and
              Phoenix Leasing Cash Distribution Fund IV

Disclosure Pursuant to Section 16, Item 405 of Regulation S-K:

         The General  Partner (and any corporate  general partner of the General
Partner) of the  Registrant,  and the executive  officers of the General Partner
(or any corporate  general  partner of the General  Partner) of the  Registrant,
file reports  pursuant to Section 16(a) of the Securities  Exchange Act of 1934,
as amended.  Based solely on the Registrant's review of the copies of such forms
received by the Registrant,  the Registrant believes that, during 1998, all such
required reports were filed on a timely basis.


                                       23
<PAGE>

Certain Legal Proceedings.

         On October 28, 1997, a Class Action  Complaint  (the  "Complaint")  was
filed against Phoenix Leasing Inc., Phoenix Leasing Associates, II and III L.P.,
Phoenix   Securities  Inc.  and  Phoenix  American  Inc.  (the  "Companies")  in
California  Superior Court for the County of Sacramento by eleven individuals on
behalf of investors in Phoenix Leasing Cash Distribution  Funds I through V (the
"Partnerships").  The  Companies  were served with the  Complaint on December 9,
1997. The Complaint sought  declaratory and other relief  including  accounting,
receivership,  imposition of  constructive  trust and judicial  dissolution  and
winding up of the Partnerships,  and damages based on fraud, breach of fiduciary
duty and  breach  of  contract  by the  Companies  as  general  partners  of the
Partnerships.

         Plaintiffs  severed  one cause of action  from the  Complaint,  a claim
related to the marketing and sale of CDF V, and  transferred  it to Marin County
Superior  Court (the "Marin  Action").  Plaintiffs  then dismissed the remaining
claims in  Sacramento  Superior  Court and re-filed  them in a separate  lawsuit
making similar allegations (the "Sacramento Action").

         Plaintiffs have amended the Marin Action twice. Defendants have not yet
answered the Complaint and may file a demurrer to dismiss the claims.  Discovery
has not commenced. The Companies intend to vigorously defend the Complaint.

         In February  1999,  plaintiffs  requested a transfer of the  Sacramento
Action  to  Marin  County.  The  Court  granted  that  request,  and the case is
currently  in  transit.  Defendants  have not yet  responded  to the  Complaint.
Discovery  has not  commenced.  The Companies  intend to  vigorously  defend the
Complaint.


Item 10.      Executive Compensation.
              ----------------------

         Set forth is the information  relating to all direct  remuneration paid
or accrued by the Registrant during the last year to the General Partner.


<TABLE>
         Set forth is the information  relating to all direct  remuneration paid
or accrued by the Registrant during the last year to the General Partner.
<CAPTION>
         (A)                       (B)                                    (C)                                   (D)

                                                                  Cash and cash-                          Aggregate of
Name of Individual           Capacities in                        equivalent forms                        contingent forms
or persons in group          which served                         of remuneration                         of remuneration
-------------------          ------------            -------------------------------------------          -----------------
                                                              (C1)                     (C2)
                                                                              Securities or property
                                                Salaries, fees, directors'    insurance benefits or
                                                fees, commissions, and        reimbursement, personal
                                                bonuses                       benefits
                                                -------------------------     -----------------------
                                                               (Amounts in Thousands)

<S>                          <C>                        <C>                            <C>                      <C>
Phoenix Leasing
  Associates LP              General Partner            $   57(1)                    $   -                    $   -
                                                         ======                        =====                    ====
<FN>
(1)  consists of management fees.
</FN>

</TABLE>

                                     PART IV

Item 11.      Security Ownership of Certain Beneficial Owners and Management.
              --------------------------------------------------------------

         (a)  No person  owns of record,  or is known by the  Registrant  to own
              beneficially,  more  than  five  percent  of any  class of  voting
              securities of the Registrant.

         (b)  The General Partner of the Registrant  owns the equity  securities
              of the Registrant set forth in the following table:


                                       24
<PAGE>

               (1)                         (2)                        (3)
         Title of Class          Amount Beneficially Owned      Percent of Class
         --------------          -------------------------      ----------------

     General Partner Interest   Represents a 5% interest in            100%
                                the Registrant's profits and
                                distributions, until the Limited
                                Partners have recovered their
                                capital contributions plus a
                                cumulative return of 12% per
                                annum, compounded quarterly, on
                                the unrecovered portion thereof.
                                Thereafter, the General Partner
                                will receive 15% interest in the
                                Registrant's profits and
                                distributions.

     Limited Partner Interest   12 units                                -


Item 12.      Certain Relationships and Related Transactions.
              ----------------------------------------------

         None.


Item 13.      Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
              ----------------------------------------------------------------

                                                                        Page No.
                                                                        --------
(a)      1.   Financial Statements:

              Balance Sheet as of December 31, 1999                        11
              Statements of Operations and Comprehensive Income
                for the Years Ended December 31, 1999 and 1998             12
              Statements of Partners' Capital for the Years
                Ended December 31, 1999 and 1998                           13
              Statements of Cash Flows for the Years Ended
                December 31, 1999 and 1998                                 14
              Notes to Financial Statements                             15-22

         All other schedules are omitted because they are not applicable, or not
required,  or because the  required  information  is  included in the  financial
statements or notes thereto.

(b)      Reports on Form 8-K:

         No reports on Form 8-K were filed for the quarter  ended  December  31,
1999.

(c)      Exhibits

         21.  Additional Exhibits

               a) Balance Sheets of Phoenix Leasing Associates, Inc.   E21  1-5
                  Balance Sheets of Phoenix Leasing Associates L.P.    E21  6-9

         27.  Financial Data Schedule


                                       25
<PAGE>

                                   SIGNATURES

         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.

                                    PHOENIX INCOME FUND, L.P.
                                    a California limited partnership
                                          (Registrant)

                                    BY:   PHOENIX LEASING ASSOCIATES LP,
                                          a California limited partnership,
                                          General Partner

                                          BY:  PHOENIX LEASING ASSOCIATES, INC.,
                                               a Nevada corporation,
                                               General Partner


         Date:  March 17, 2000      By:    /S/ GUS CONSTANTIN
                --------------             -------------------------
                                           Gus Constantin, President

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

       Signature                      Title                         Date
       ---------                      -----                         ----


/S/ GUS CONSTANTIN         President and a Director            March 17, 2000
-------------------------  of Phoenix Leasing Associates, Inc. --------------
(Gus Constantin)


/S/ GARY W. MARTINEZ       Senior Vice President and           March 17, 2000
-------------------------  a Director of                       --------------
(Gary W. Martinez)         Phoenix Leasing Associates, Inc.


/S/ HOWARD SOLOVEI         Chief Financial Officer,            March 17, 2000
-------------------------  Treasurer and Director of           --------------
(Howard Solovei)           Phoenix Leasing Associates, Inc.



                                       26