UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-K

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

For the fiscal year ended March 31, ~~2010~~2011

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

For the transition period from__________to__________

Commission File Number 0-21762

Gateway Tax Credit Fund III Ltd.

(Exact name of Registrant as specified in its charter)

Florida		59-3090386
(State or other jurisdiction of incorporation or organization)		(IRS Employer No.)

880 Carillon Parkway		St. Petersburg, Florida 33716
(Address of principal executive offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code:

(727) 567-1000

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

Securities registered pursuant to Section 12(g) of the Act:

Title of Each Class

Units of Limited Partnership Interest

		Number of Record Holders
Title of Class		as of March 31, ~~2010~~2011
Limited Partnership Interest		2,~~052~~048
General Partner Interest		2

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

YES [ ]

NO [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

YES [ ]

NO [X]

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 has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit and post such files).

YES [X]

NO [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (Sec. 229.405 of this chapter) 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-K or any amendment to this Form 10-K. [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ]	Smaller Reporting Company [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]

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrants most recently completed second fiscal quarter.

There is no market for the Registrant’s Limited Partnership interests.

DOCUMENTS INCORPORATED BY REFERENCE

Parts I, II, III and IV –- Form S-11 Registration Statement

and all amendments and supplements thereto.

File No. 33-44238

PART I

Item 1. Business

Gateway Tax Credit Fund III Ltd. (“Gateway”) is a Florida Limited Partnership. The general partners are Raymond James Tax Credit Funds, Inc., the Managing General Partner, and Raymond James Partners, Inc., (collectively, the “General Partners”) both sponsors of Gateway Tax Credit Fund III Ltd. and wholly owned subsidiaries of Raymond James Financial, Inc. Gateway was formed October 17, 1991 and commenced operations July 16, 1992 with the first admission of Limited Partners.

Gateway is engaged in only one industry segment, to acquire limited partnership interests in unaffiliated limited partnerships (“Project Partnerships”), each of which owns and operates one or more apartment complexes eligible for Low-Income Housing Tax Credits (“Tax Credits”) under Section 42 of the Internal Revenue Code, received over a ten year period. Subject to certain limitations, Tax Credits may be used by Gateway's investors to reduce their income tax liability generated from other income sources. Gateway will terminate on December 31, 2040 or sooner, in accordance with the terms of its Limited Partnership Agreement. As of March 31, ~~2010~~2011, Gateway received capital contributions of $1,000 from the General Partners and from the Limited Partners: $10,395,000 in Series 7, $9,980,000 from Series 8, $6,254,000 from Series 9, $5,043,000 from Series 10 and $5,127,000 from Series 11.

Gateway offered Limited Partnership units in series. Each Series invests in a separate and distinct pool of Project Partnerships. Net proceeds from each Series were used to acquire Project Partnerships which are specifically allocated to such Series. Income or loss and all tax items from the Project Partnerships acquired by each Series are specifically allocated among the Limited Partners of such Series.

Operating profits and losses, cash distributions from operations and Tax Credits are allocated 99% to the Limited Partners and 1% to the General Partners. Profit or loss and cash distributions from sales of properties will be allocated as described in the Limited Partnership Agreement.

Gateway initially held investments in 133 Project Partnerships. As more fully described in Item 7 herein, Gateway is presently in the process of disposing of its interests in Project Partnerships ~~which have reached the end of their fifteen-year Tax Credit compliance period~~. As of March 31, ~~2010~~2011, 1421 Project Partnerships once held by Gateway have been sold. Project Partnership investments held by Series as of March 31, ~~2010~~2011 are as follows: 3025 Project Partnerships for Series 7, 40 Project Partnerships for Series 8, 2322 Project Partnerships for Series 9, 14 Project Partnerships for Series 10 and 1211 Project Partnerships for Series 11. Gateway acquired its interests in the Project Partnerships by becoming a limited partner in the Project Partnerships that own the properties. As of March 31, ~~2010~~2011, the capital received for each Series was fully invested in Project Partnerships and management plans no new Project Partnership acquisitions.

The primary source of funds from the inception of each Series has been the capital contributions from Limited Partner investors. Gateway’s operating costs are funded using the reserves established for this purpose, the interest earned on these reserves and distributions received from Project Partnerships. Gateway has also received proceeds from the sale of Project Partnerships and made corresponding cash distributions to Limited Partners.

All but eight of the Project Partnerships are financed with mortgage loans from the Farmers Home Administration (now called United States Department of Agriculture - Rural Development) (“USDA-RD”) under Section 515 of the Housing Act of 1949. These mortgage loans are made at low interest rates for multi-family housing in rural and suburban areas, with the requirement that the interest savings be passed on to low income tenants in the form of lower rents. A significant portion of the project partnerships also receive rental assistance from USDA-RD to subsidize certain qualifying tenants. One Project Partnership in Series 7 received conventional financing. One Project Partnership in Series 9, two Project Partnerships in Series 10 and one Project Partnership in Series 11 are fully financed through the HOME Investment Partnerships Program. These HOME Program loans provide financing at rates of 0 % to 0.5% for a period of 15 to 42 years. One Project Partnership in Series 11 is partially financed by HOME. Two Project Partnerships in Series 11 received conventional financing.

The investment objectives of Gateway are to:

1) Provide tax benefits to Limited Partners in the form of Tax Credits during the period in which each Project is eligible ~~to claim Tax Credits;~~

to claim Tax Credits;

2) Preserve and protect the capital of each Series.

The investment objectives and policies of Gateway are described in detail on pages 39 through 47 of the Prospectus under the caption “Investment Objectives and Policies” which is incorporated herein by reference.

Item 1. Business (Continued)

Gateway's goal is to invest in a diversified portfolio of Project Partnerships located in rural and suburban locations with a high demand for low income housing. As of March 31, ~~2010~~2011, each Series' investor capital contributions were successfully invested in Project Partnerships which met the investment criteria. The Tax Credits have been provided to Gateway’s investors and the fifteen year Tax Credit compliance period has expired for ~~most~~all of the Project Partnerships (see further information in the Exit Strategy discussion below). Gateway is now in the process of disposing of its remaining interests and distributing proceeds from those sales to the Limited Partners. Gateway’s objective is to sell Gateway’s interests in Project Partnerships which have exited the Tax Credit compliance period for fair market value and ultimately, liquidate the Project Partnerships and in turn liquidate Gateway.

Gateway has no direct employees. Services are performed by the Managing General Partner and its affiliates and by agents retained by it. The Managing General Partner has full and exclusive discretion in management and control of Gateway.

Exit Strategy Upon expiration of the Project Partnership Tax Credit Compliance Period

When Project Partnerships reach the end of their Tax Credit compliance period, Gateway initiates a process of disposing of its investments in the Project Partnerships. The objective is to sell Gateway’s interest in such properties for fair market value and ultimately, liquidate the Project Partnerships and in turn, when Gateway’s last Project Partnership investment is sold, liquidate Gateway.

The IRS compliance period for low-income housing Tax Credit properties is generally 15 years from occupancy following construction or rehabilitation completion.

OfAll of the original 133 Project Partnership investments, ~~125 Project Partnerships~~ have reached the end of their Tax Credit compliance period as of December 31, ~~2009 and the 8 Project Partnerships that have yet to reach the end of the Tax Credit compliance period will do so in the year ending December 31,~~ 2010. As of March 31, ~~2010~~2011, 1421 of the Project Partnership investments have been sold and, in accordance with the Gateway partnership agreement, the entire net proceeds received from these sales either have been or will be distributed to the Limited Partners of those Series. On a cumulative basis as of March 31, ~~2010~~2011, $338,877 of net sales proceeds representing $32.60 per Limited Partner unit in Series 7 and $67,964 of net sales proceeds representing $6.81 per Limited Partner unit in Series 8 have been distributed to the Limited Partners of the respective Series.

Item 1A. Risk Factors

The General Partners do not believe the Project Partnerships are subject to the risks generally associated with conventionally financed nonsubsidized apartment properties. Risks related to the operations of Gateway are described in detail on pages 29 through 38 of the Prospectus, as supplemented, contained in the Registration Statement, File No. 33-44238 (“Prospectus”), under the Caption “Risk Factors” which is incorporated herein by reference.

Gateway, as a limited partner in the Project Partnerships, is subject to risks inherent in the ownership of property which are beyond its control, such as fluctuations in occupancy rates and operating expenses, variations in rental schedules, proper maintenance and continued eligibility of Tax Credits. If the cost of operating a property exceeds the rental income earned thereon, Gateway may deem it in its best interest to voluntarily provide funds in order to protect its investment. No such contributions have been made during fiscal year ~~2010~~2011, ~~2009~~2010 or ~~2008~~2009.

Investors eventually may be allocated profits for tax purposes which exceed any cash Gateway distributes to them. Under these circumstances, unless an investor has passive losses or credits to reduce such tax liability, the investor will have to pay federal income tax without a corresponding cash distribution from Gateway. Similarly, in the event of a sale or foreclosure of an apartment complex, an investor may be allocated taxable income, resulting in a tax liability in excess of any cash distributed to the investor as a result of such event.

There is no assurance that investors will receive any cash distributions from the sale or disposal of a Project Partnership. The price at which a Project Partnership is sold may not be sufficient to pay the mortgage and other expenses which must be paid at such time.

Item 1B. Unresolved Staff Comments

None.

~~Gateway~~Item ~~holds an interest in properties through its limited partnership investments in Project Partnerships~~2. The largest single net investment as of March 31, 2010 in a Project Partnership for each respective Series is: Series 7, one Project Partnership investment constitutes 28.6% of the Series' total assets, Series 10, one Project Partnership investment constitutes 22.4% of the Series’ total assets, and Series 11, one Project Partnership constitutes 25.9% of the Series’ total assets (the net investment for book purposes is zero for each Project Partnership in Series 8 and Series 9). The following table provides certain summary information regarding the Project Partnerships in which Gateway held an interest as of December 31, 2009 (the Project Partnerships’ financial information contained herein is reported on a 3-month lag):Properties

SERIES 7
PARTNERSHIP	LOCATION OF PROPERTY	# OF UNITS	DATE ACQUIRED	PROPERTY COST	OCCUPANCY RATE
Nottingham	Pisgah, AL	18	6/92	790,969	100%
Washington	Bloomfield, NE	24	9/92	993,827	75%
BrookStone	McCaysville, GA	40	9/92	1,465,231	98%
N. Irvine	Irvine, KY	24	9/92	1,038,563	96%
Horton	Horton, KS	24	9/92	932,540	79%
Manchester	Manchester, GA	42	9/92	1,474,516	100%
Waynesboro	Waynesboro, GA	24	9/92	819,270	100%
Lakeland II	Lakeland, GA	30	9/92	1,009,647	97%
Mt. Vernon	Mt. Vernon, GA	24	9/92	900,526	75%
Meadow Run	Dawson, GA	48	9/92	1,744,840	98%
Warm Springs	Warm Springs, GA	22	9/92	822,692	95%
Blue Ridge	Blue Ridge, GA	41	9/92	1,339,143	98%
Pioneer	Mountain View, AR	48	9/92	1,531,280	100%
Dilley	Dilley, TX	28	9/92	890,965	100%
Elsa	Elsa, TX	40	9/92	1,342,015	100%
Leander	Leander, TX	36	9/92	1,186,753	100%
Louisa Sr.	Louisa, KY	36	9/92	1,451,921	100%
Orchard Commons	Crab Orchard, KY	12	9/92	450,887	100%
Vardaman	Vardaman, MS	24	9/92	929,282	92%
Heritage Park	Paze, AZ	32	9/92	1,656,880	100%
BrooksHollow	Jasper, GA	40	9/92	1,482,789	98%
Cavalry Crossing	Ft. Scott, KS	40	9/92	1,903,195	95%
Carson City	Carson City, KS	24	11/92	979,092	83%
Matteson	Capa, KS	24	11/92	967,320	79%
Pembroke	Pembroke, KY	16	12/92	588,717	94%
Robynwood	Cynthiana, KY	24	12/92	962,677	96%
Atoka	Atoka, OK	24	1/93	835,334	100%
Coalgate	Coalgate, OK	24	1/93	828,505	100%
Hill Creek	West Blocton, AL	24	11/93	1,008,947	96%
Cardinal	Mountain Home, AR	32	11/93	785,240	91%
Total Series 7		889		$ 33,113,563
The average effective rental income per unit for the year ended December 31, 2009 is $4,361 per year ($363 per month).

Gateway holds an interest in properties through its limited partnership investments in Project Partnerships. The largest single net investment as of March 31, 2011 in a Project Partnership for each respective Series is: Series 10, one Project Partnership investment constitutes 21.7% of the Series’ total assets, and in Series 11, one Project Partnership constitutes 22.5% of the Series’ total assets (the net investment for book purposes is zero for each Project Partnership in Series 7, 8 and 9). The following table provides certain summary information regarding the Project Partnerships in which Gateway held an interest as of December 31, 2010 (the Project Partnerships’ financial information contained herein is reported on a 3-month lag):

SERIES 7
PARTNERSHIP	LOCATION OF PROPERTY	# OF UNITS		DATE ACQUIRED		PROPERTY COST		OCCUPANCY RATE
PARTNERSHIP	LOCATION OF PROPERTY	# OF UNITS		DATE ACQUIRED		PROPERTY COST		OCCUPANCY RATE
Nottingham	Pisgah, AL		18		6/92	$	796,494		94	%
Washington	Bloomfield, NE		24		9/92		993,827		71	%
BrookStone	McCaysville, GA		40		9/92		1,464,981		98	%
N. Irvine	Irvine, KY		24		9/92		1,044,872		96	%
Manchester	Manchester, GA		42		9/92		1,474,516		98	%
Waynesboro	Waynesboro, GA		24		9/92		819,270		100	%
Lakeland II	Lakeland, GA		30		9/92		1,009,647		97	%
Mt. Vernon	Mt. Vernon, GA		24		9/92		900,526		96	%
Meadow Run	Dawson, GA		48		9/92		1,744,840		90	%
Warm Springs	Warm Springs, GA		22		9/92		822,692		100	%
Blue Ridge	Blue Ridge, GA		41		9/92		1,339,143		100	%
Dilley	Dilley, TX		28		9/92		892,426		100	%
Elsa	Elsa, TX		40		9/92		1,342,015		100	%
Leander	Leander, TX		36		9/92		1,170,184		100	%
Louisa Sr.	Louisa, KY		36		9/92		1,451,921		100	%
Orchard Commons	Crab Orchard, KY		12		9/92		450,887		100	%
Vardaman	Vardaman, MS		24		9/92		929,282		96	%
Heritage Park	Paze, AZ		32		9/92		1,663,447		97	%
BrooksHollow	Jasper, GA		40		9/92		1,514,019		93	%
Cavalry Crossing	Ft. Scott, KS		40		9/92		1,908,549		93	%
Carson City	Carson City, KS		24		11/92		982,335		75	%
Matteson	Capa, KS		24		11/92		973,185		67	%
Pembroke	Pembroke, KY		16		12/92		588,717		100	%
Robynwood	Cynthiana, KY		24		12/92		962,677		100	%
Hill Creek	West Blocton, AL		24		11/93		1,011,517		92	%

Total Series 7			737			$	28,251,969

The average effective rental income per unit for the year ended December 31, 2010 is $4,543 per year ($379 per month).

Item 2 - Properties (Continued)

SERIES 8

PARTNERSHIP

LOCATION OF PROPERTY

~~LOCATION OF PROPERTY~~

# OF UNITS

~~# OF UNITS~~

~~DATE ACQUIRED~~

DATE ACQUIRED

~~PROPERTY COST~~

~~OCCUPANCY RATE~~

PROPERTY COST

OCCUPANCY RATE

Purdy

Purdy, MO

~~Purdy, MO~~

~~12/92~~

~~641,882~~12/92

~~88%~~

668,614

Galena

Galena, KS

~~Galena, KS~~

~~12/92~~

~~864,229~~12/92

~~100%~~

893,643

Antlers 2

Antlers, OK

~~Antlers, OK~~

~~1/93~~

~~787,859~~1/93

~~100%~~

787,859

Holdenville

Holdenville, OK

~~Holdenville, OK~~

~~1/93~~

~~892,598~~1/93

~~96%~~

892,598

Wetumka

Wetumka, OK

~~Wetumka, OK~~

~~1/93~~

~~812,853~~1/93

~~58%~~

812,853

Mariners Cove

Marine City, MI

~~Marine City, MI~~

~~1/93~~

1~~,136,726~~/93

~~88%~~

1,344,796

Mariners Cove Sr.

Marine City, MI

~~Marine City, MI~~

~~1/93~~

1~~,039,783~~/93

~~100%~~

1,042,248

Antlers

Antlers, OK

~~Antlers, OK~~

~~3/93~~

~~1,321,039~~3/93

~~89%~~

1,321,039

Bentonville

Bentonville, AR

~~Bentonville, AR~~

~~3/93~~

~~758,489~~3/93

~~92%~~

758,489

Deerpoint

Elgin, AL

~~Elgin, AL~~

~~3/93~~

~~948,824~~3/93

~~88%~~

948,824

100

Aurora

Aurora, MO

~~Aurora, MO~~

~~3/93~~

~~977,152~~3/93

~~89%~~

990,087

Baxter

Baxter Springs, KS

~~Baxter Springs, KS~~

~~4/93~~

~~622,917~~4/93

~~100%~~

631,666

100

Arbor Gate

Bridgeport, AL

~~Bridgeport, AL~~

~~5/93~~

~~959,891~~5/93

~~75%~~

965,988

Timber Ridge

Collinsville, AL

~~Collinsville, AL~~

~~5/93~~

~~957,300~~5/93

~~79%~~

964,519

Concordia Sr.

Concordia, KS

~~Concordia, KS~~

~~5/93~~

~~826,389~~5/93

~~88%~~

826,389

Mountainburg

Mountainburg, AR

~~Mountainburg, AR~~

~~6/93~~

~~883,990~~6/93

~~100%~~

883,990

Lincoln

Pierre, SD

~~Pierre, SD~~

~~5/93~~

~~1,187,005~~5/93

~~96%~~

1,206,788

100

Fox Ridge

Russellville, AL

~~Russellville, AL~~

~~6/93~~

~~909,110~~6/93

~~88%~~

909,110

Meadow View

Bridgeport, NE

~~Bridgeport, NE~~

~~6/93~~

~~751,302~~6/93

~~81%~~

753,978

100

Sheridan

Auburn, NE

~~Auburn, NE~~

~~6/93~~

~~828,983~~6/93

~~100%~~

834,822

100

Grand Isle

Grand Isle, ME

~~Grand Isle, ME~~

~~6/93~~

~~1,212,833~~6/93

~~88%~~

1,212,833

Meadowview

Van Buren, AR

~~Van Buren, AR~~

~~8/93~~

~~994,717~~8/93

~~100%~~

994,717

Taylor

Taylor, TX

~~Taylor, TX~~

~~9/93~~

~~1,530,463~~9/93

~~100%~~

1,530,463

Brookwood

Gainesboro, TN

~~Gainesboro, TN~~

~~9/93~~

~~1,817,627~~9/93

~~98%~~

1,823,526

Pleasant Valley

Lynchburg, TN

~~Lynchburg, TN~~

~~9/93~~

~~1,422,746~~9/93

~~97%~~

1,457,746

100

Reelfoot

Ridgely, TN

~~Ridgely, TN~~

~~9/93~~

~~828,993~~9/93

~~95%~~

830,045

River Rest

Newport, TN

~~Newport, TN~~

~~9/93~~

~~1,459,819~~9/93

~~97%~~

1,465,419

100

Kirksville

Kirksville, MO

~~Kirksville, MO~~

~~9/93~~

~~831,492~~9/93

~~100%~~

831,492

Kenton

Kenton, OH

~~Kenton, OH~~

~~9/93~~

~~1,781,759~~9/93

~~87%~~

1,781,759

Lovingston

Lovingston, VA

~~Lovingston, VA~~

~~9/93~~

~~2,841,268~~9/93

~~97%~~

2,841,268

100

Pontotoc

Pontotoc, MS

~~Pontotoc, MS~~

~~10/93~~

~~1,359,366~~10/93

~~100%~~

1,442,814

Hustonville

Hustonville, KY

~~Hustonville, KY~~

~~10/93~~

~~722,785~~10/93

~~94%~~

725,282

Northpoint

Jackson, KY

~~Jackson, KY~~

~~10/93~~

~~1,133,365~~10/93

~~100%~~

1,139,654

Brooks Field

Louisville, GA

~~Louisville, GA~~

~~10/93~~

~~1,176,740~~10/93

~~100%~~

1,245,043

100

Brooks Lane

Clayton, GA

~~Clayton, GA~~

~~10/93~~

~~1,377,993~~10/93

~~100%~~

1,377,993

Brooks Point

Dahlonega, GA

~~Dahlonega, GA~~

~~10/93~~

~~1,658,964~~10/93

~~98%~~

1,699,639

Brooks Run

Jasper, GA

~~Jasper, GA~~

~~10/93~~

~~941,628~~10/93

~~100%~~

957,486

100

Logan Heights

Russellville, KY

~~Russellville, KY~~

~~11/93~~

~~957,380~~11/93

~~88%~~

963,707

Lakeshore 2

Tuskegee, AL

~~Tuskegee, AL~~

~~12/93~~

~~1,473,068~~12/93

~~89%~~

1,480,011

Cottondale

Cottondale, FL

~~Cottondale, FL~~

~~1/94~~

~~948,319~~1/94

~~96%~~

948,319

100

Total Series 8

1,121

~~$ 44,579,646~~

45,187,516

The average effective rental income per unit for the year ended December 31, 2009 is $4,553 per year ($379 per month).

The average effective rental income per unit for the year ended December 31, 2010 is $4,707 per year ($392 per month).

Item 2 - Properties (Continued)

SERIES 9
PARTNERSHIP	LOCATION OF PROPERTY	~~LOCATION OF PROPERTY~~	# OF UNITS	~~# OF UNITS~~	~~DATE ACQUIRED~~	DATE ACQUIRED	~~PROPERTY COST~~	~~OCCUPANCY RATE~~	PROPERTY COST		OCCUPANCY RATE
Jay	Jay, OK	~~Jay, OK~~		24	~~9/93~~		~~810,597~~9/93	~~100%~~	$	810,597		100	%
Boxwood	Lexington, TX	~~Lexington, TX~~		24	~~9/93~~		~~770,939~~9/93	~~100%~~		770,939		100	%
Stilwell 3		Stilwell, OK		16	9/93		587,132	56%
Arbor Trace	Lake Park, GA			24			11/93			918,358		100	%
Arbor Trace		Lake Park, GA		24	11/93		918,358	100%
Arbor Trace 2	Lake Park, GA			42			11/93			1,806,434		98	%
Arbor Trace 2		Lake Park, GA		42	11/93		1,806,434	90%
Omega	Omega, GA			36			11/93			1,407,304		94	%
Omega		Omega, GA		36	11/93		1,407,304	89%
Cornell 2	Watertown, SD			24			11/93			1,275,936		88	%
Cornell 2		Watertown, SD		24	11/93		1,270,021	96%
Elm Creek	Pierre, SD			24			11/93			1,358,399		88	%
Elm Creek		Pierre, SD		24	11/93		1,349,078	83%
Marionville	Marionville, MO			20			11/93			804,558		95	%
Marionville		Marionville, MO		20	11/93		791,717	100%
Lamar	Lamar, AR			24			12/93			904,325		96	%
Lamar		Lamar, AR		24	12/93		904,325	75%
Centreville	Centreville, AL			24			12/93			1,009,795		100	%
Centreville		Centreville, AL		24	12/93		1,001,108	100%
Skyview	Troy, AL			36			12/93			1,502,296		94	%
Skyview		Troy, AL		36	12/93		1,456,364	94%
Sycamore	Coffeyville, KS			40			12/93			1,864,224		100	%
Sycamore		Coffeyville, KS		40	12/93		1,860,916	95%
Bradford	Cumberland, KY			24			12/93			1,026,848		100	%
Bradford		Cumberland, KY		24	12/93		1,026,848	100%
Cedar Lane	London, KY			24			12/93			963,841		100	%
Cedar Lane		London, KY		24	12/93		963,841	100%
Stanton	Stanton, KY			24			12/93			959,149		100	%
Stanton		Stanton, KY		24	12/93		959,149	100%
Abernathy	Abernathy, TX			24			1/94			781,898		92	%
Abernathy		Abernathy, TX		24	1/94		781,898	83%
Pembroke	Pembroke, KY			24			1/94			950,827		100	%
Pembroke		Pembroke, KY		24	1/94		950,827	92%
Meadowview	Greenville, AL			24			2/94			1,170,447		100	%
Meadowview		Greenville, AL		24	2/94		1,170,447	88%
Town Branch	Mt. Vernon, KY			24			12/93			937,356		100	%
Town Branch		Mt. Vernon, KY		24	12/93		937,356	100%
Fox Run	Ragland, AL			24			3/94			978,195		96	%
Fox Run		Ragland, AL		24	3/94		978,195	100%
Maple Street	Emporium, PA			32			3/94			1,722,593		97	%
Maple Street		Emporium, PA		32	3/94		1,715,881	100%
Manchester	Manchester, GA			18			5/94			735,449		94	%
Manchester		Manchester, GA		18	5/94		735,449	100%
Total Series 9				584					$	24,659,768
Total Series 9				600			$ 25,154,184
The average effective rental income per unit for the year ended December 31, 2010 is $4,660 per year ($388 per month).
The average effective rental income per unit for the year ended December 31, 2009 is $4,447 per year ($371 per month).

Item 2 - Properties (Continued)

SERIES 10

PARTNERSHIP

LOCATION OF PROPERTY

~~LOCATION OF PROPERTY~~

# OF UNITS

~~# OF UNITS~~

~~DATE ACQUIRED~~

DATE ACQUIRED

~~PROPERTY COST~~

~~OCCUPANCY RATE~~

PROPERTY COST

OCCUPANCY RATE

Albany

Albany, KY

~~Albany, KY~~

~~1/94~~

1~~,013,806~~/94

~~100%~~

1,013,806

100

Oak Terrace

Bonifay, FL

~~Bonifay, FL~~

~~1/94~~

~~663,278~~1/94

~~100%~~

663,278

100

Wellshill

West Liberty, KY

~~West Liberty, KY~~

~~1/94~~

1~~,282,246~~/94

~~100%~~

1,282,246

100

Applegate

Florence, AL

~~Florence, AL~~

~~2/94~~

~~1,873,008~~2/94

~~100%~~

1,874,908

Heatherwood

Alexander, AL

~~Alexander, AL~~

~~2/94~~

~~1,661,886~~2/94

~~100%~~

1,661,886

100

Peachtree

Gaffney, SC

~~Gaffney, SC~~

~~3/94~~

~~1,217,381~~3/94

~~96%~~

1,217,381

Donna

Donna, TX

~~Donna, TX~~

~~1/94~~

1~~,777,573~~/94

~~100%~~

1,778,336

100

Wellsville

Wellsville, NY

~~Wellsville, NY~~

~~2/94~~

~~1,487,949~~2/94

~~100%~~

1,489,251

100

Tecumseh

Tecumseh, NE

~~Tecumseh, NE~~

~~4/94~~

~~1,186,197~~4/94

~~63%~~

1,186,197

Clay City

Clay City, KY

~~Clay City, KY~~

~~5/94~~

~~1,100,354~~5/94

~~96%~~

1,113,165

100

Irvine West

Irvine, KY

~~Irvine, KY~~

~~5/94~~

~~1,134,037~~5/94

~~100%~~

1,154,266

100

New Castle

New Castle, KY

~~New Castle, KY~~

~~5/94~~

~~1,053,900~~5/94

~~96%~~

1,057,325

Stigler

Stigler, OK

~~Stigler, OK~~

~~7/94~~

~~754,056~~7/94

~~100%~~

754,056

100

Courtyard

Huron, SD

~~Huron, SD~~

~~8/94~~

~~811,230~~8/94

~~95%~~

824,964

Total Series 10

385

~~$ 17,016,901~~

17,071,065

The average effective rental income per unit for the year ended December 31, 2009 is $4,471 per year ($373 per month).

The average effective rental income per unit for the year ended December 31, 2010 is $4,780 per year ($398 per month).

SERIES 11

PARTNERSHIP

LOCATION OF PROPERTY

~~LOCATION OF PROPERTY~~

# OF UNITS

~~# OF UNITS~~

~~DATE ACQUIRED~~

DATE ACQUIRED

~~PROPERTY COST~~

~~OCCUPANCY RATE~~

PROPERTY COST

OCCUPANCY RATE

Homestead

Pinetop, AZ

~~Pinetop, AZ~~

~~9/94~~

~~1,846,395~~9/94

~~100%~~

1,846,395

Mountain Oak

Collinsville, AL

~~Collinsville, AL~~

~~9/94~~

~~894,455~~9/94

~~75%~~

894,455

Eloy

Eloy, AZ

~~Eloy, AZ~~

~~11/94~~

~~1,088,412~~11/94

~~96%~~

1,145,495

Gila Bend

Gila Bend, AZ

~~Gila Bend, AZ~~

~~11/94~~

~~1,583,442~~11/94

~~81%~~

1,601,998

Creekstone

Dallas, GA

~~Dallas, GA~~

~~12/94~~

~~2,008,604~~12/94

~~93%~~

2,008,604

Tifton

Tifton, GA

~~Tifton, GA~~

~~12/94~~

~~1,706,886~~12/94

~~97%~~

1,706,886

Cass Towne

Cartersville, GA

~~Cartersville, GA~~

~~12/94~~

~~359,614~~12/94

~~80%~~

360,040

100

Warsaw

Warsaw, VA

~~Warsaw, VA~~

~~12/94~~

~~3,482,202~~12/94

~~100%~~

3,517,768

100

Royston

Royston, GA

~~Royston, GA~~

~~12/94~~

~~934,609~~12/94

~~100%~~

934,548

100

Red Bud

Mokane, MO

~~Mokane, MO~~

~~12/94~~

~~302,699~~12/94

~~75%~~

305,198

Cardinal

Mountain Home, AR

12/94

512,292

91%

Parsons

Parsons, KS

12/94

1,438,601

100

Parsons

Parsons, KS

12/94

1,430,526

87%

Total Series 11

329

15,759,988

Total Series 11

361

$ 16,150,136

The average effective rental income per unit for the year ended December 31, 2010 is $5,577 per year ($465 per month).

The average effective rental income per unit for the year ended December 31, 2009 is $4,947 per year ($412 per month).

Item 2 - Properties (Continued)

A summary of the book value of the fixed assets of the Project Partnerships as of December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 is as follows:

		12/31/2009
	12/31/2010
	SERIES 7	~~SERIES 7~~		SERIES 8			~~SERIES 9~~	SERIES 9
Land	$	1,~~331~~102,~~869~~244	$	~~1,841,988~~$	1,841,988	$	~~1,076,159~~	$	1,066,159
Land Improvements		185,259		~~449,688~~	506,661		~~266,148~~		267,829
Buildings		3026,~~482~~107,~~220~~509		~~39,998,985~~	40,441,082		~~22,826,427~~		22,319,500
Furniture and Fixtures		1856,~~107,081~~957		~~2,288,985~~	2,397,785		~~985,450~~		1,006,280
Construction in Process		7,134		0			0
Properties, at Cost		28,251,969			45,187,516				24,659,768
Properties, at Cost		33,113,563		44,579,646			25,154,184
Less: Accum Depr.		15,080,769			24,615,247				12,235,111
Less: Accum Depr.		16,929,623		23,197,112			11,869,777
Properties, Net	$	13,171,200		$	20,572,269			$	12,424,657
Properties, Net	$	16,183,940	$	21,382,534		$	13,284,407
	SERIES 10			SERIES 11				TOTAL
		SERIES 10		SERIES 11			TOTAL
Land	$	641,025		$	583,404			$	5,234,820
Land	$	641,025	$	599,197		$	5,490,238
Land Improvements		169,702			22,242				1,151,693
Land Improvements		148,044		22,242			1,071,381
Buildings		15,608,336			14,402,902				118,879,329
Buildings		15,602,386		14,793,221			123,703,239
Furniture and Fixtures		652,002			751,440				5,664,464
Furniture and Fixtures		625,446		735,475			5,742,437
Properties, at Cost		17,071,065			15,759,988				130,930,306
Construction in Process		0		0			7,134
Less: Accum Depr.		7,062,374			7,441,864				66,435,365
Properties, at Cost		17,016,901		16,150,135			136,014,429
Properties, Net	$	10,008,691		$	8,318,124			$	64,494,941
Less: Accum Depr.		6,629,121		7,119,194			65,744,827
Properties, Net	$	10,387,780	$	9,030,941		$	70,269,602

		12/31/2008
	12/31/2009
	SERIES 7	~~SERIES 7~~		SERIES 8			~~SERIES 9~~	SERIES 9
Land	$	1,~~656~~331,~~669~~869	$	~~1,947,646~~$	1,841,988	$	~~1,099,659~~	$	1,076,159
Land Improvements		~~169~~185,~~924~~259		~~425,619~~	449,688		~~234,276~~		266,148
Buildings		3730,~~305~~482,~~480~~220		~~42,332,059~~	39,998,985		~~23,763,784~~		22,826,427
Furniture and Fixtures		1,~~607~~107,~~149~~081		~~2,440,596~~	2,288,985		~~1,048,730~~		985,450
Construction in Process		7,134		0	-		0		-
Properties, at Cost		4033,~~746~~113,~~356~~563		~~47,145,920~~	44,579,646		~~26,146,449~~		25,154,184
Less: Accum Depr.		2016,~~275~~929,~~065~~623		~~23,298,320~~	23,197,112		~~11,745,765~~		11,869,777
Properties, Net	$	2016,~~471~~183,~~291~~940	$	~~23,847,600~~$	21,382,534	$	~~14,400,684~~	$	13,284,407
	SERIES 10	~~SERIES 10~~		SERIES 11			~~TOTAL~~	TOTAL
Land	$	~~648~~641,~~625~~025	$	~~599,197~~$	599,197	$	~~5,951,796~~	$	5,490,238
Land Improvements		~~145~~148,~~644~~044		~~22,242~~	22,242		~~997,705~~		1,071,381
Buildings		1615,~~569~~602,~~411~~386		~~14,716,563~~	14,793,221		~~134,687,297~~		123,703,239
Furniture and Fixtures		~~711~~625,~~717~~446		~~696,059~~	735,475		~~6,504,251~~		5,742,437
Construction in Process		0-		0	-		~~7,134~~		7,134
Properties, at Cost		1817,~~075~~016,~~397~~901		~~16,034,061~~	16,150,135		~~148,148,183~~		136,014,429
Less: Accum Depr.		6,~~862~~629,~~997~~121		~~6,598,452~~	7,119,194		~~68,780,599~~		65,744,827
Properties, Net	$	1110,~~212~~387,~~400~~780	$	~~9,435,609~~$	9,030,941	$	~~79,367,584~~	$	70,269,602

Item 2 - Properties (Continued)

		12/31/2007
	12/31/2008
	SERIES 7	~~SERIES 7~~		SERIES 8			~~SERIES 9~~	SERIES 9
Land	$	1,~~756~~656,669	$	~~1,947,646~~$	1,947,646	$	~~1,099,659~~	$	1,099,659
Land Improvements		~~299~~169,~~050~~924		~~423,554~~	425,619		~~230,418~~		234,276
Buildings		4237,~~429~~305,~~742~~480		~~42,154,871~~	42,332,059		~~23,761,563~~		23,763,784
Furniture and Fixtures		21,~~090~~607,~~121~~149		~~2,322,456~~	2,440,596		~~1,005,879~~		1,048,730
Construction in Process		7,134		0	-		0		-
Properties, at Cost		4640,~~582~~746,~~716~~356		~~46,848,527~~	47,145,920		~~26,097,519~~		26,146,449
Less: Accum Depr.		2120,~~787~~275,~~463~~065		~~21,803,677~~	23,298,320		~~10,955,123~~		11,745,765
Properties, Net	$	2420,~~795~~471,~~253~~291	$	~~25,044,850~~$	23,847,600	$	~~15,142,396~~	$	14,400,684
	SERIES 10	~~SERIES 10~~		SERIES 11			~~TOTAL~~	TOTAL
Land	$	648,625	$	~~599,197~~$	599,197	$	~~6,051,796~~	$	5,951,796
Land Improvements		~~119~~145,~~284~~644		~~22,242~~	22,242		~~1,094,548~~		997,705
Buildings		16,~~565~~569,~~186~~411		~~14,702,954~~	14,716,563		~~139,614,316~~		134,687,297
Furniture and Fixtures		~~638~~711,~~397~~717		~~654,026~~	696,059		~~6,710,879~~		6,504,251
Construction in Process		0-		0	-		~~7,134~~		7,134
Properties, at Cost		1718,~~971~~075,~~492~~397		~~15,978,419~~	16,034,061		~~153,478,673~~		148,148,183
Less: Accum Depr.		6,~~378~~862,~~478~~997		~~6,078,106~~	6,598,452		~~67,002,847~~		68,780,599
Properties, Net	$	11,~~593~~212,~~014~~400	$	~~9,900,313~~$	9,435,609	$	~~86,475,826~~	$	79,367,584

Item 3. Legal Proceedings

Gateway is not a party to any material pending legal proceedings.

Item 4. (Removed and Reserved)

PART II

Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

(a) Gateway's Limited Partnership interests are not publicly traded. There is no market for Gateway's Limited Partnership interests and it is unlikely that any will develop. No transfers of Limited Partnership Interests are permitted without the prior written consent of the Managing General Partner. There have been numerous transfers from inception to date with most being from individuals to their trusts or heirs. The Managing General Partner is not aware of the price at which Limited Partnership units are transferred. The criteria for and the details regarding transfers are found on pages A-28 and A-29 of the Limited Partnership Agreement under ARTICLE XII under the caption “Transfers of Units” found in the Prospectus, which is incorporated herein by reference.

(b) Approximate Number of Equity Security Holders:

		Number of Record Holders
Title of Class		as of March 31, ~~2010~~2011
Limited Partnership Interest		2,~~052~~048
General Partner Interest		2

Item 6. Selected Financial Data

FOR THE YEARS ENDED MARCH 31,

SERIES 7	~~2010~~	2011	~~2009~~		~~2008~~	2010	~~2007~~		~~2006~~	2009			2008			2007
Total Revenues	~~$ 31,189~~	$	~~$ 26~~23,~~416~~473		~~$ 36,085~~	$	~~$ 27~~31,~~050~~189		~~$ 21,470~~	$	26,416		$	36,085		$	27,050
Net Income (Loss)	~~142,985~~		~~(349~~473,~~081)~~439		~~(345,647)~~		~~(366~~142,~~648)~~985		~~(467,796)~~		(349,081	)		(345,647	)		(366,648	)
Equity in Income (Loss) of Project Partnerships	-		~~707~~-		~~(28,789)~~		~~(78,519)~~-		~~(92,380)~~		707			(28,789	)		(78,519	)
Total Assets	~~293,719~~		~~335~~770,~~175~~297		~~650,076~~		~~906~~293,~~324~~719		~~1,186,879~~		335,175			650,076			906,324
Investments In Project Partnerships	~~84,017~~		~~88,308~~-		~~284,147~~		~~442~~84,~~787~~017		~~641,745~~		88,308			284,147			442,787
Per Weighted Average
Limited Partnership Unit: (A)
Tax Credits	~~.00~~		.00		~~.00~~		.9600		~~8.05~~		.00			.00			.96
Portfolio Income	~~3.52~~		71.4075		~~10.02~~		83.1552		~~6.16~~		7.40			10.02			8.15
Passive Loss	~~(100.74)~~		(~~104~~73.~~98)~~86	)	~~(94.93)~~		(98100.~~00)~~74	)	~~(100.77)~~		(104.98	)		(94.93	)		(98.00	)
Net Income (Loss)	~~8.32~~		~~(37~~45.~~38)~~09		~~(32.92)~~		~~(34~~8.~~92)~~32		~~(44.55)~~		(37.38	)		(32.92	)		(34.92	)
Distributions Paid	~~28.43~~		~~4.17~~-		-		-28.43		-		4.17			-			-

FOR THE YEARS ENDED MARCH 31,

SERIES 8	~~2010~~	2011	~~2009~~		~~2008~~	2010	~~2007~~		~~2006~~	2009			2008			2007
Total Revenues	~~$ 23,800~~	$	~~$ 18~~24,~~335~~662		~~$ 29,379~~	$	~~$ 15~~23,~~890~~800		~~$ 16,963~~	$	18,335		$	29,379		$	15,890
Net Loss	~~(91,802)~~		(~~517~~90,~~416)~~218	)	~~(251,652)~~		(~~240~~91,~~629)~~802	)	~~(216,489)~~		(517,416	)		(251,652	)		(240,629	)
Equity in Loss of Project Partnerships	~~(2,631)~~		~~(45,239)~~-		~~(54,012)~~		(152,~~683)~~631	)	~~(29,928)~~		(45,239	)		(54,012	)		(15,683	)
Total Assets	~~238,988~~		~~200~~231,~~925~~397		~~625,123~~		~~741~~238,~~918~~988		~~893,391~~		200,925			625,123			741,918
Investments In Project Partnerships	-		~~15,007~~-		~~296,532~~		~~377,733~~-		~~415,344~~		15,007			296,532			377,733
Per Weighted Average
Limited Partnership Unit: (A)
Tax Credits	~~.00~~		.00		~~.00~~		1.5500		~~16.92~~		.00			.00			1.55
Portfolio Income	~~4.11~~		83.7099		~~12.04~~		104.6811		~~7.30~~		8.70			12.04			10.68
Passive Loss	~~(113.31)~~		(~~131~~96.~~63)~~76	)	~~(110.05)~~		(~~110~~113.~~42)~~31	)	~~(110.88)~~		(131.63	)		(110.05	)		(110.42	)
Net Loss	~~(11.39)~~		(519.~~36)~~35	)	~~(31.71)~~		(2311.~~87)~~39	)	~~(21.48)~~		(51.36	)		(31.71	)		(23.87	)
Distributions Paid	-		~~6.81~~-		-		-		-		6.81			-			-

Item 6. Selected Financial Data (Continued)

FOR THE YEARS ENDED MARCH 31,

SERIES 9	~~2010~~	2011	~~2009~~		~~2008~~	2010	~~2007~~		~~2006~~	2009			2008			2007
Total Revenues	~~$ 15,862~~	$	~~$ 10~~16,~~038~~002		~~$ 8,514~~	$	~~$ 6~~15,~~166~~862		~~$ 4,437~~	$	10,038		$	8,514		$	6,166
Net Loss	~~(120,481)~~		(~~416~~9,~~956)~~637	)	~~(242,723)~~		(~~248~~120,~~128)~~481	)	~~(341,082)~~		(416,956	)		(242,723	)		(248,128	)
Equity in Loss of Project Partnerships	~~(4,909)~~		~~(87,688)~~-		~~(100,405)~~		(~~117~~4,~~893)~~909	)	~~(101,726)~~		(87,688	)		(100,405	)		(117,893	)
Total Assets	~~96,912~~		~~134~~142,~~007~~196		~~502,778~~		~~694~~96,~~273~~912		~~893,314~~		134,007			502,778			694,273
Investments In Project Partnerships	-		~~9,681~~-		~~292,761~~		~~412,287~~-		~~550,442~~		9,681			292,761			412,287
Per Weighted Average
Limited Partnership Unit: (A)
Tax Credits	~~.00~~		.00		~~.00~~		.00		~~6.34~~		.00			.00			.00
Portfolio Income	~~1.84~~		62.0272		~~8.73~~		71.4084		~~5.41~~		6.02			8.73			7.40
Passive Loss	~~(131.15)~~		(~~130~~103.~~99)~~73	)	~~(112.02)~~		(~~103~~131.~~96)~~15	)	~~(90.51)~~		(130.99	)		(112.02	)		(103.96	)
Net Loss	~~(20.65)~~		(668.~~00)~~65	)	~~(38.42)~~		(3920.~~28)~~65	)	~~(53.99)~~		(66.00	)		(38.42	)		(39.28	)

FOR THE YEARS ENDED MARCH 31,

SERIES 10	~~2010~~	2011	~~2009~~		~~2008~~	2010	~~2007~~		~~2006~~	2009			2008			2007
Total Revenues	~~$ 8,658~~	$	$ 12,~~302~~943		~~$ 2,129~~	$	~~$ 2~~8,~~563~~658		~~$ 2,561~~	$	12,302		$	2,129		$	2,563
Net Loss	~~(100,294)~~		(~~609~~60,~~675)~~829	)	~~(561,574)~~		(~~261~~100,~~712)~~294	)	~~(355,932)~~		(609,675	)		(561,574	)		(261,712	)
Equity in (Loss) Income of Project Partnerships	~~(28,325)~~		~~796~~(25,669	)	~~(75,336)~~		(~~113~~28,~~347)~~325	)	~~(111,553)~~		796			(75,336	)		(113,347	)
Total Assets	~~250,905~~		~~295~~218,~~574~~357		~~872,011~~		1250,~~398,676~~905		~~1,626,672~~		295,574			872,011			1,398,676
Investments In Project Partnerships	~~97,267~~		~~136~~64,~~408~~697		~~672,563~~		197,~~159,544~~267		~~1,360,959~~		136,408			672,563			1,159,544
Per Weighted Average
Limited Partnership Unit: (A)
Tax Credits	~~.00~~		.00		~~.00~~		.00		~~9.58~~		.00			.00			.00
Portfolio Income	~~2.97~~		61.2457		~~9.28~~		82.7597		~~7.55~~		6.24			9.28			8.75
Passive Loss	~~(98.97)~~		(8958.~~39)~~86	)	~~(79.58)~~		(9198.~~68)~~97	)	~~(90.73)~~		(89.39	)		(79.58	)		(91.68	)
Net Loss	~~(21.65)~~		(~~119~~12.~~69)~~33	)	~~(110.24)~~		(5121.~~38)~~65	)	~~(69.87)~~		(119.69	)		(110.24	)		(51.38	)

FOR THE YEARS ENDED MARCH 31,

SERIES 11	~~2010~~	2011	~~2009~~		~~2008~~	2010	~~2007~~		~~2006~~	2009			2008			2007
Total Revenues	~~$ 4,207~~	$	~~$ 2~~3,~~182~~607		~~$ 2,782~~	$	~~$ 3~~4,~~382~~207		~~$ 3,382~~	$	2,182		$	2,782		$	3,382
Net Loss	~~(188,280)~~		(~~468~~45,~~075)~~060	)	~~(628,777)~~		(~~470~~188,~~714)~~280	)	~~(776,165)~~		(468,075	)		(628,777	)		(470,714	)
Equity in Loss of Project Partnerships	~~(80,592)~~		(~~115~~107,~~651)~~077	)	~~(74,752)~~		(3280,~~981)~~592	)	~~(96,562)~~		(115,651	)		(74,752	)		(32,981	)
Total Assets	~~621,840~~		~~782~~602,~~534~~148		~~1,220,597~~		1621,~~821,412~~840		~~2,271,082~~		782,534			1,220,597			1,821,412
Investments In Project Partnerships	~~411,872~~		~~536~~245,~~485~~863		~~935,152~~		1411,~~505,978~~872		~~1,926,349~~		536,485			935,152			1,505,978
Per Weighted Average
Limited Partnership Unit: (A)
Tax Credits	~~.00~~		.00		~~.00~~		8.5700		~~110.21~~		.00			.00			8.57
Portfolio Income	~~2.49~~		51.6103		~~7.55~~		62.6149		~~5.75~~		5.61			7.55			6.61
Passive Loss	~~(69.47)~~		(7163.~~57)~~44	)	~~(67.19)~~		(5669.~~12)~~47	)	~~(52.47)~~		(71.57	)		(67.19	)		(56.12	)
Net Loss	~~(36.36)~~		(9016.~~38)~~94	)	~~(121.41)~~		(9036.~~89)~~36	)	~~(149.87)~~		(90.38	)		(121.41	)		(90.89	)

FOR THE YEARS ENDED MARCH 31,

TOTAL SERIES 7 - 11	~~2010~~	2011	~~2009~~		~~2008~~	2010	~~2007~~		~~2006~~	2009			2008			2007
Total Revenues	~~$ 83,716~~	$	~~$ 69~~80,~~273~~687		~~$ 78,889~~	$	~~$ 55~~83,~~051~~716		~~$ 48,813~~	$	69,273		$	78,889		$	55,051
Net Loss	(357,872)		(2,361,203)		(2,030,373)		(1,587,831)		(2,157,464)
Net Income (Loss)			267,695				(357,872	)			(2,361,203	)		(2,030,373	)		(1,587,831	)
Equity in Loss of Project Partnerships	~~(116,457)~~		(~~247~~132,~~075)~~746	)	~~(333,294)~~		(~~358~~116,~~423)~~457	)	~~(432,149)~~		(247,075	)		(333,294	)		(358,423	)
Total Assets	~~1,502,364~~		1,~~748~~964,~~215~~395		~~3,870,585~~		51,~~562~~502,~~603~~364		~~6,871,338~~		1,748,215			3,870,585			5,562,603
Investments In Project Partnerships	~~593,156~~		~~785~~310,~~889~~560		~~2,481,155~~		3593,~~898,239~~156		~~4,894,839~~		785,889			2,481,155			3,898,239

(A) The tax information is as of December 31, the year end for tax purposes.

The above selected financial data should be read in conjunction with the financial statements and related notes appearing elsewhere in this report. This statement is not covered by the auditor's opinion included elsewhere in this report.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis (“MD&A”) is intended to help the reader understand the results of operations and financial condition of Gateway. The MD&A is provided as a supplement to, and should be read in conjunction with the financial statements and accompanying footnotes to the financial statements contained elsewhere in this report.

The Managing General Partner monitors developments in the area of legal and regulatory compliance. For example, the Sarbanes-Oxley Act of 2002 (the “Act”) mandates or suggests additional compliance measures with regard to governance, disclosure, audit and other areas, and certain provisions of the Act have been implemented by Gateway and other provisions will be implemented by Gateway in subsequent years.

Gateway –- All Series - The following discusses the overall results of operations, liquidity and capital resources for Gateway as a whole. A summary of the activity within each specific Series of Gateway then follows.

Results of Operations

As more fully detailed in the Exit Strategy discussion included within this MD&A, all of the Project Partnerships have delivered their Tax Credits to Gateway and the Tax Credit compliance period has expired for ~~125~~all 133 of the Project Partnerships initially held. Gateway is in the process of selling or disposing of its interests in Project Partnerships that have reached the end of their Tax Credit compliance period. Net proceeds received from the sales are in turn distributed to the Limited Partners. Once all Project Partnership interests have been sold or otherwise disposed of, Gateway will be liquidated. The target date for liquidation of Gateway is on or before December 31, 2012, although there is no certainty, and it may not even be considered likely at this time, that all the activities necessary to occur as of such date will have transpired.

Distribution income arises from any cash distributions received from Project Partnerships which have a zero investment balance for financial reporting purposes. Distribution income ~~increased~~decreased 214% in fiscal year ~~2010~~2011 to $8380,~~716~~687, ana ~~increase~~decrease of $143,~~443~~029 from the fiscal year ~~2009~~2010 distribution income of $6983,~~273~~716, which represented a $914,~~616~~443 or 1221% ~~decrease~~increase as compared to distribution income of $7869,~~889~~273 in fiscal year ~~2008~~2009. The ~~increase~~decrease in distribution income for the year ended March 31, ~~2010~~2011 is a result of ~~fewer~~a ~~Project~~reduction ~~Partnerships~~in ~~with~~distribution ~~investment~~payments ~~balances~~to ~~coupled~~Gateway ~~with~~by anthe ~~increase of gross distributions received from~~ Project Partnerships. The number of Project Partnerships with an investment balance decreased from 149 as of March 31, ~~2009~~2010 to 94 as of March 31, ~~2010~~2011. The gross distributions received from Project Partnerships ~~increased~~decreased from $~~101~~114,~~326~~268 for the year ended March 31, ~~2009~~2010 to $~~114~~95,~~268~~789 for the year ended March 31, ~~2010~~2011. The ~~decrease~~increase in distribution income for the year ended March 31, ~~2009~~2010 is a result of afewer ~~reduction~~Project inPartnerships ~~distribution~~with ~~payments~~investment tobalances ~~Gateway~~coupled bywith ~~the~~an increase of gross distributions received from Project Partnerships.

Gateway has no direct employees. The General Partners have full and exclusive discretion in management and control of Gateway. Total expenses of Gateway were $~~673~~397,~~401~~859 for the fiscal year ended March 31, ~~2010~~2011, a decrease of $1275,~~583,833~~542 as compared to the fiscal year ~~2009~~2010 total expenses of $2673,~~257~~401,~~234,~~ which represented a $~~335~~1,~~745~~583,833 ~~increase~~decrease in total expenses as compared to the fiscal year ~~2008~~2009 amount of $12,~~921~~257,~~489~~234. Impairment expense represents a significant component of total expenses in fiscal year 2009 ~~and 2008~~. Impairment expense is a non-cash charge that reflects a potential decline in the carrying value of Gateway’s interest in Project Partnerships. Historically, Gateway has considered the residual value of the Project Partnerships as one key component of its estimate of the present value of Gateway’s interest in any of its Project Partnerships. During ~~the~~fiscal ~~quarter~~year ~~ended December 31~~2011, ~~2008,~~no asimpairment aexpense ~~direct~~was result of the deterioration that occurred within the United States financial markets and more specifically, its negative impact on the Tax Credit market, Gateway concluded that any residual value of the Project Partnerships given the Tax Credit market conditions could not be practicably determinedrecognized. ~~As a result, in the quarter ended December 31, 2008 Gateway eliminated estimates of residual value of the Project Partnerships from the recoverability portion of its impairment analysis.~~ During fiscal years 2010, ~~2009~~ and ~~2008~~2009, impairment expense was recorded in the aggregate amount of $28,099, and $1,340,110 ~~and $962~~,~~003,~~ respectively. Net of this impairment expense, expenses of Gateway decreased $~~271~~247,~~822~~443, or 3038% in fiscal year ~~2010~~2011 versus fiscal year ~~2009~~2010. The decrease in fiscal year ~~2010~~2011 results primarily from decreases in 1) asset management fees and general and administrative expenses –- General Partner due to sales of Project Partnerships (Gateway ceases accruing Asset Management Fees and General and Administrative Expenses –- General Partner for sold Project Partnerships) along with the cessation of accruals for general and administrative expenses –- General Partner in Series 8 (beginning in fiscal year 2010), ~~and~~ Series 7, 9 and 10 (beginning in March 2010); and Series 11 (beginning in October 2010); 2) amortization expense (resulting from the suspension of amortization due to Project Partnership investment balances reaching zero or the acquisition fees and expense being fully amortized). The fiscal year ~~2009~~2010 expense represented a $42271,~~362~~822, or 430%, decrease from the fiscal year ~~2008~~2009 amount of $~~959~~917,~~486~~124 (net of impairment expense).

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

For the year ended March 31, ~~2010~~2011, Equity in Loss of Project Partnerships totaled $~~116~~132,~~457~~746 which represents a $~~130~~16,~~618~~289 ~~decrease~~increase as compared to the Equity in Loss of Project Partnerships for the year ended March 31, ~~2009~~2010 of $~~247~~116,~~075~~457. For the year ended March 31, ~~2008~~2009, Equity in Loss of Project Partnerships totaled $~~333~~247,~~294~~075. Equity in Loss of Project Partnerships ~~decreased~~increased for the year ended March 31, ~~2010~~2011 as compared to the year ended March 31, ~~2009~~2010 because of aan ~~decrease~~increase in the losses from Project Partnerships with a positive investment ~~balances~~balance. Because Gateway utilizes the equity method of accounting for its Project Partnerships, income or losses from Project Partnerships with a zero investment balance are not recognized in the Statement of Operations. For the year ended December 31, ~~2009~~2010 (Project Partnership financial information is reported on a three-month lag), Gateway’s share of the net loss was $2,~~478~~197,~~314~~029, of which $2,~~361~~064,~~857~~283 was suspended. For the year ended December 31, ~~2008~~2009, Gateway’s share of the net loss was $2,~~548~~478,~~187~~314, of which $2,~~301~~361,~~112~~857 was suspended. For the year ended December 31, ~~2007~~2008, Gateway’s share of the net loss was $2,~~016~~548,~~916~~187, of which $12,~~683~~301,~~622~~112 was suspended. Typically, it is customary in the low-income housing Tax Credit industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. As the Project Partnership investments mature and the Investments in Project Partnership balances decrease over time, the losses from Project Partnerships recorded by Gateway decrease.

In fiscal year ~~2010~~2011, the Gain on Sale of Project Partnerships amounted to $~~343~~717,~~518~~489, an increase of $~~299~~373,~~744~~971 over the fiscal year ~~2009~~2010 amount of $43343,~~774~~518, which in turn was aan ~~decrease~~increase of $24299,~~226~~744 from the fiscal year ~~2008~~2009 Gain on Sale of Project Partnerships amount of $6843,~~000~~774. As more fully discussed herein, ~~nine~~seven Project Partnership investments were sold during fiscal year 2010 as compared to ~~four~~nine in fiscal year ~~2009~~2010 and ~~one~~four in fiscal year ~~2008~~2009. The amount of the gain or loss from the sale of a Project Partnership and the year in which it is recognized on the Statement of Operations is dependent upon the specifics related to each sale or disposition transaction. Refer to the discussion of each Project Partnerships sold in the Exit Strategy section within this MD&A.

Interest income for the year ended March 31, ~~2010~~2011 of $~~4,752~~124 represents a decrease of $254,~~307~~628 or 8497%, as compared to fiscal year ~~2009~~2010. Interest income in fiscal year ~~2009~~2010 of $304,~~059~~752 was a decrease of $4725,~~462~~307 or 6184% as compared to the fiscal year ~~2008~~2009 interest income of $7730,~~521~~059. The changes in interest income over the prior two fiscal years result primarily from the fluctuation of interest rates on short-term investments over that period, along with the maturation of several investments in securities over the same period. Investments in Securities ~~decreased~~were to $0 as of March 31, ~~2010~~2011 ~~from $79,337 as of March 31, 2009 as a result of the redemption of U.S. Treasury Security Strips in February 2010~~ and ~~the~~decreased ~~reinvestment~~to of$0 ~~these funds into cash and cash equivalents. Investments in Securities~~ as of March 31, ~~2009~~2010 ~~decreased $669,738~~ from $~~749~~79,~~075~~337 as of March 31, ~~2008~~2009. This asdecrease was a result of the redemption of U.S. Treasury ~~Notes in June 2008, the redemption of U.S.~~ Security Strips in February ~~2009~~2010 and the reinvestment of these funds into cash and cash equivalents. Interest income is generally one source of funds available to pay administrative costs of Gateway.

Liquidity and Capital Resources

The capital resources of each Series are used to pay General and Administrative operating costs including personnel, supplies, data processing, travel, legal and accounting associated with the administration and monitoring of Gateway and the Project Partnerships. The capital resources are also used to pay the Asset Management Fee due the Managing General Partner, but only to the extent that Gateway's remaining resources are sufficient to fund Gateway's ongoing needs. (Payment of any Asset Management Fee unpaid at the time Gateway sells its interests in the Project Partnerships is subordinated to the Limited Partners’ return of their original capital contribution).

The sources of funds to pay the expenses of Gateway are cash and cash equivalents and the interest earnings thereon, and cash distributed to the Series from the operations of the Project Partnerships. Due to the rent limitations applicable to the Project Partnerships as a result of their qualifying for Low-Income Housing Tax Credits, Gateway does not expect there to be a significant increase in future rental income of the Project Partnerships. Therefore, cash distributions from the operations of the Project Partnerships are not expected to increase on a per project basis. However, operational factors of the Project Partnerships and the timing of distributions contribute to fluctuations of distributions from year to year. Management believes these sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

In total, Gateway reported a net loss of $~~357~~267,~~872~~695 from operations for the year ended March 31, ~~2010~~2011. Cash and Cash Equivalents increased by $26744,~~219 and Investments in Securities decreased by $79,337 (due to the maturation of Gateway’s remaining U~~627.~~S. Treasury investments during fiscal year 2010).~~ Of the Cash and Cash Equivalents on hand as of March 31, ~~2010~~2011, $48765,~~451~~940 is payable to certain Series’ Limited Partners arising from the sale of Project Partnerships. After consideration of these sales proceeds, Cash and Cash Equivalents ~~and~~increased ~~Investments in Securities decreased~~ $~~101~~27,~~106~~138 as compared to the prior year-end balances.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

The financial performance of each respective Series is summarized as follows:

Series 7 - Gateway closed this series on October 16, 1992 after receiving $10,395,000 from 635 Limited Partner investors. As of March 31, ~~2010~~2011, the Series had invested $54,~~721~~648,~~083~~444 in 3025 Project Partnerships located in 108 states containing ~~889~~737 apartment units. Average occupancy of the Project Partnerships was 9594% at December 31, ~~2009~~2010.

Equity in Loss of Project Partnerships was $0 in fiscal year 2011. Equity in Income (Loss) of Project Partnerships decreased to $0 in fiscal year 2010 from income of $707 for fiscal year 2009. ~~The fiscal year 2009 income was a $29,496 increase from the fiscal year 2008 loss of $28,789.~~ As presented in Note 54, the Project Partnerships generated a loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 of $~~695~~548,~~025~~804, $~~597~~695,~~535~~025 and $~~569~~597,~~021~~535 on Rental and other income of $54,~~284~~434,~~523~~943, $65,~~397~~284,~~144~~523 and $76,~~209~~397,~~575~~144, respectively. Gateway’s share of the Project Partnerships’ net loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 was $~~701~~573,~~101~~276, $~~617~~701,~~777~~101 and $~~592~~617,~~531~~777, of which $~~701~~573,~~101~~276, $~~618~~701,~~484~~101 and $~~563~~618,~~742~~484 were suspended, respectively. If not suspended, these losses would have reduced the Investments in Project Partnerships below zero. The suspended losses for the year ended December 31, 2008 of $618,484 exceed Gateway’s share of the total net loss of $617,777 because certain Project Partnerships with investment balances generated net income of $707. In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. (These Project Partnerships reported depreciation and amortization of $1847,~~008~~923,~~239,~~ $1,~~277~~008,~~049~~239 and $1,~~495~~277,~~597~~049 for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008, respectively). As a result, management expects that this Series, as well as the Series described below, will report its equity in Project Partnerships as a loss for tax and financial reporting purposes. Gateway reviews its investments in Project Partnerships to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. There was no impairment expense for the fiscal ~~year~~years ended March 31, 2011 or 2010. For the fiscal ~~years~~year ended March 31, 2009 ~~and 2008~~, impairment expense of $183,299 ~~and~~ ~~$99,867~~was ~~were~~ recognized~~, respectively~~. Overall management believes the Project Partnerships are operating as expected and have generated Tax Credits which met projections.

At March 31, ~~2010~~2011, the Series had $~~209~~770,~~702~~297 of short-term investments (Cash and Cash Equivalents). Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

As disclosed on the statement of cash flows, the Series had net income of $~~142~~473,~~985~~439 for the year ended March 31, ~~2010~~2011. However, after considering the changes in operating assets and liabilities, net cash used in operating activities was $7787,~~342~~434. Cash provided by investing activities totaled $~~335~~648,~~707~~029 consisting of $3522,~~189~~635 in cash distributions from the Project Partnerships and $~~300~~625,~~518~~394 in net proceeds from the Sale of Project Partnerships (refer to the Exit Strategy section within this MD&A for more detailed discussion of these sales of Project Partnerships). ~~Cash used in financing activities consists of distributions paid to Limited Partners totaling $295,530.~~

Series 8 - Gateway closed this Series on ~~June~~July 281, 1993 after receiving $9,980,000 from 664 Limited Partner investors. As of March 31, ~~2010~~2011, the Series had invested $6,~~941~~965,~~449~~669 in 40 Project Partnerships located in 17 states containing 1,121 apartment units. Average occupancy of the Project Partnerships was 92% at December 31, ~~2009~~2010.

Equity in Loss of Project Partnerships decreased ~~$42,608~~ to $~~2,631~~0 in fiscal year ~~2010~~2011 asfrom ~~compared~~a toloss of $452,~~239~~631 infor fiscal year ~~2009~~2010. ~~The~~Equity ~~fiscal~~in ~~year~~Loss ~~2009~~of ~~amount~~Project Partnerships decreased $842,~~773~~608 ~~from~~to ~~the~~$2,631 in fiscal year ~~2008~~2010 ~~loss~~as ofcompared to $5445,~~012~~239 in fiscal year 2009. As presented in Note 54, the Project Partnerships generated a loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 of $~~782~~723,~~205~~487, $~~925~~782,~~731~~205 and $~~660~~925,~~764~~731 on Rental and other income of $6,~~930~~793,~~389~~755, $76,~~026~~930,~~802~~389 and $67,~~962~~026,~~343~~802, respectively. Gateway’s share of the Project Partnerships’ net loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 was $~~777~~717,~~837~~967, $~~921~~777,~~647~~837 and $~~660~~921,~~633~~647, of which $~~775~~717,~~206~~967, $~~876~~775,~~408~~206 and $~~606~~876,~~621~~408 were suspended, respectively. If not suspended, these losses would have reduced the Investments in Project Partnerships below zero. In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. (These Project Partnerships reported depreciation and amortization of $1,~~397~~420,~~733~~237, $1,~~498~~397,~~607~~733 and $1,~~489~~498,~~012~~607 for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008, respectively). Gateway reviews its investments in Project Partnerships to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. There was no impairment expense for the fiscal year ended March 31, 2011. For the fiscal years ended March 31, 2010, ~~2009~~ and ~~2008~~2009, impairment expense of $8,681, and $221,243 ~~and~~was ~~$31,346 were~~ recognized, respectively. Overall management believes the Project Partnerships are operating as expected and have generated Tax Credits which met projections.

At March 31, ~~2010~~2011, the Series had $~~238~~231,~~988~~397 of short-term investments (Cash and Cash Equivalents). Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

As disclosed on the statement of cash flows, the Series had a net loss of $9190,~~802~~218 for the year ended March 31, ~~2010~~2011. However, after ~~adjusting~~considering ~~for Equity in Loss of Project Partnerships of $2,631 and~~ the changes in operating assets and liabilities, net cash ~~provided~~used byin operating activities was $336,~~731~~253. Cash provided by investing activities totaled $4928,~~339~~662 consisting of $2624,~~339~~662 in cash distributions from the Project Partnerships and $234,000 in net proceeds from the Sale of Project Partnerships (refer to the Exit Strategy section within this MD&A for more detailed discussion of these sales of Project Partnerships).

Series 9 - Gateway closed this Series on September 30, 1993 after receiving $6,254,000 from 406 Limited Partner investors. As of March 31, ~~2010~~2011, the Series had invested $4,~~703~~599,~~741~~313 in 2322 Project Partnerships located in 10 states containing ~~600~~584 apartment units. Average occupancy of the Project Partnerships was 9397% at December 31, ~~2009~~2010.

Equity in Loss of Project Partnerships decreased ~~$82,779~~ to $~~4,909~~0 in fiscal year ~~2010~~2011 asfrom ~~compared~~a toloss of $874,~~688~~909 infor fiscal year ~~2009~~2010. ~~The~~Equity ~~fiscal~~in ~~year~~Loss ~~2009~~of ~~amount~~Project Partnerships decreased $1282,~~717~~779 ~~from~~to ~~the~~$4,909 in fiscal year ~~2008~~2010 ~~loss~~as ofcompared to $~~100~~87,~~405~~688 in fiscal year 2009. As presented in Note 54, the Project Partnerships generated a loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 of $~~552~~452,~~678~~089, $~~540~~552,~~476~~678 and $~~440~~540,~~158~~476 on Rental and other income of $3,~~633~~690,~~336~~119, $3,~~756~~633,~~581~~336 and $3,~~716~~756,~~532~~581, respectively. Gateway’s share of the Project Partnerships’ net loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 was $~~547~~447,~~151~~568, $~~542~~547,~~656~~151 and $~~435~~542,~~756~~656, of which $~~542~~447,~~242~~568, $~~454~~542,~~968~~242 and $~~335~~454,~~351~~968 were suspended, respectively. If not suspended, these losses would have reduced the Investments in Project Partnerships below zero. In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. (These Project Partnerships reported depreciation and amortization of $~~747~~733,~~222~~144, $~~790~~747,~~640~~222 and $~~784~~790,~~023~~640 for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008, respectively). Gateway reviews its investments in Project Partnerships to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. There was no impairment expense for the fiscal ~~year~~years ended March 31, 2011 or 2010. For the fiscal year ended March 31, 2009, impairment expense of $180,400 was recognized. ~~There was no impairment expense for the fiscal year ended March 31, 2008.~~ Overall management believes the Project Partnerships are operating as expected and have generated Tax Credits which met projections.

At March 31, ~~2010~~2011, the Series had $96142,~~912~~196 of short-term investments (Cash and Cash Equivalents). Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

As disclosed on the statement of cash flows, the Series had a net loss of $~~120~~9,~~481~~637 for the year ended March 31, ~~2010~~2011. However, after considering the ~~Equity in Loss of Project Partnerships of $4,909 and the~~ changes in operating assets and liabilities, net cash used in operating activities was $5515,~~055~~748. Cash provided by investing activities totaled $2761,~~641~~032 consisting of $1716,~~641~~002 in cash distributions from the Project Partnerships and $1045,~~000~~030 in net proceeds from the Sale of Project Partnerships (refer to the Exit Strategy section within this MD&A for more detailed discussion of this sale of Project Partnership).

Series 10 - Gateway closed this Series on January 21, 1994 after receiving $5,043,000 from 325 Limited Partner investors. As of March 31, ~~2010~~2011, the Series had invested $3,716,106 in 14 Project Partnerships located in 9 states containing 385 apartment units. Average occupancy of the Project Partnerships was 97% at December 31, ~~2009~~2010.

Equity in (Loss) ~~Income~~ of Project Partnerships decreased $292,~~121~~656 to ~~a loss of~~ $2825,~~325~~669 in fiscal year ~~2010~~2011 as compared to ~~income of~~ $~~796~~28,325 ~~for~~in fiscal year ~~2009~~2010. ~~The~~Equity ~~fiscal~~in ~~year~~(Loss) ~~2009~~Income ~~income~~of ~~was~~Project aPartnerships decreased $7629,~~132~~121 ~~increase~~to ~~from~~a ~~the~~loss of $28,325 in fiscal year ~~2008~~2010 ~~loss~~as compared to income of $~~75,336~~796 for fiscal year 2009. As presented in Note 54, the Project Partnerships generated a loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 of $~~201~~144,~~549~~571, $~~169,~~201,549 and $~~144~~169,~~893~~201 on Rental and other income of $2,~~239~~307,~~370~~400, $2,~~397~~239,~~697~~370 and $2,~~355~~397,~~826~~697, respectively. Gateway’s share of the Project Partnerships’ net loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 was $~~211~~163,~~172~~491, $~~170~~211,~~536~~172 and $~~142~~170,~~726~~536, of which $~~182~~137,~~847~~822, $~~171~~182,~~332~~847 and $67171,~~390~~332 were suspended, respectively. If not suspended, these losses would have reduced the Investments in Project Partnerships below zero. The suspended losses for the year ended December 31, 2008 of $171,332 exceed Gateway’s share of the total net loss of $170,536 because certain Project Partnerships with investment balances generated net income of $796. In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. (These Project Partnerships reported depreciation and amortization of $439,~~815~~674, $~~486~~439,~~635~~815 and $~~479~~486,~~429~~635 for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008, respectively). Gateway reviews its investments in Project Partnerships to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. There was no impairment expense for the fiscal year ended March 31, 2011 or 2010. For the fiscal ~~years~~year ended March 31, 2009 ~~and 2008~~, impairment expense of $506,918 ~~and~~was ~~$376,185 were~~ recognized~~, respectively~~. Overall, management believes the Project Partnerships are operating as expected and have generated Tax Credits which met projections.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

At March 31, ~~2010~~2011, the Series had $153,~~638~~660 of short-term investments (Cash and Cash Equivalents). Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

As disclosed on the statement of cash flows, the Series had a net loss of $~~100~~60,~~294~~829 for the year ended March 31, ~~2010~~2011. However, after considering the Equity in Loss of Project Partnerships of $2825,~~325~~669 and the changes in operating assets and liabilities, net cash used in operating activities was $3621,~~231~~822. Cash provided by investing activities totaled $6821,~~807~~844 consisting of $1819,~~807~~844 in cash distributions from the Project Partnerships, and $102,000 in net proceeds from the Sale of Project Partnerships (refer to the Exit Strategy section within this MD&A for more detailed discussion of this sale of Project Partnership) ~~and $40,000 from matured investments in securities~~.

Series 11 - Gateway closed this Series on April 29, 1994 after receiving $5,127,000 from 330 Limited Partner investors. As of March 31, ~~2010~~2011 the Series had invested $43,~~128~~832,~~042~~294 in 1211 Project Partnerships located in 76 states containing ~~361~~329 apartment units. Average occupancy of the Project Partnerships was 9291% at December 31, ~~2009~~2010.

Equity in Loss of Project Partnerships ~~decreased~~increased $3526,~~059~~485 to $80107,~~592~~077 in fiscal year ~~2010~~2011 as compared to $~~115~~80,~~651~~592 in fiscal year ~~2009~~2010. ~~The~~Equity ~~fiscal~~in ~~year~~Loss ~~2009~~of ~~amount~~Project ~~increased~~Partnerships decreased $4035,~~899~~059 ~~from~~to ~~the~~$80,592 in fiscal year ~~2008~~2010 ~~loss~~as ofcompared to $74115,~~752~~651 in fiscal year 2009. As presented in Note 54, the Project Partnerships generated a loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 of $~~246~~307,~~604~~670, $~~279~~246,~~740~~604 and $~~193~~279,~~210~~740 on Rental and other income of $2,~~231~~263,~~664~~577, $2,~~161~~231,~~398~~664 and $2,~~114~~161,~~552~~398, respectively. Gateway’s share of the Project Partnerships’ net loss for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008 was $~~241~~294,~~053~~727, $~~295~~241,~~571~~053 and $~~185~~295,~~270~~571, of which $~~160~~187,~~461~~650, $~~179~~160,~~920~~461 and $~~110~~179,~~518~~920 were suspended, respectively. If not suspended, these losses would have reduced the Investments in Project Partnerships below zero. In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. (These Project Partnerships reported depreciation and amortization of $525,~~030~~157, $~~523~~525,~~527~~030 and $~~529~~523,~~741~~527 for the years ended December 31, ~~2009~~2010, ~~2008~~2009 and ~~2007~~2008, respectively). Gateway reviews its investments in Project Partnerships to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. There was no impairment expense for the fiscal year ended March 31, 2011 For the fiscal years ended March 31, 2010, ~~2009~~ and ~~2008~~2009, impairment expense of $19,418, and $248,250 ~~and~~was ~~$454,605 were~~ recognized, respectively. Overall, management believes the Project Partnerships are operating as expected and have generated Tax Credits which met projections.

At March 31, ~~2010~~2011, the Series had $~~209~~356,~~968~~285 of short-term investments (Cash and Cash Equivalents). Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

As disclosed on the statement of cash flows, the Series had a net loss of $~~188~~45,~~280~~060 for the year ended March 31, ~~2010~~2011. However, after considering the Equity in Loss of Project Partnerships of $80107,~~592~~077 and the changes in operating assets and liabilities, net cash used in operating activities was $5541,~~140~~996. Cash provided by investing activities totaled $60188,~~292~~313 consisting of $1612,~~292~~646 in cash distributions from the Project Partnerships and $44175,~~000~~667 in net proceeds from ~~matured~~the ~~investments~~Sale inof ~~securities~~Project Partnerships (refer to the Exit Strategy section within this MD&A for more detailed discussion of this sale of Project Partnership).

Critical Accounting Estimates

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Recent Accounting Changes

In June 2009, the FASB issued amendments to the consolidation guidance applicable to variable interest entities which Gateway adopted effective April 1, 2010. The amendments ~~will~~had ~~have~~ no impact on its financial statements for the year-ended March 31, 2011.

In May 2009, the FASB issued guidance regarding subsequent events, which was subsequently updated in February 2010. This guidance established general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In particular, this guidance sets forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements, and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. This guidance was effective for financial statements issued for fiscal years and interim periods ending after June 15, 2009, and was therefore adopted by Gateway for the quarter ended December 31, 2009. The adoption did not have a significant impact on the subsequent events that Gateway reports, either through recognition or disclosure, in the financial statements. In February 2010, the FASB amended its guidance on subsequent events to remove the requirement to disclose the date through which an entity has evaluated subsequent events, alleviating conflicts with current SEC guidance. This amendment was effective immediately and therefore Gateway did not include the disclosure in this Form 10-K.

Exit Strategy Upon Expiration of the Project Partnership Tax Credit Compliance Period

The IRS compliance period for low-income housing Tax Credit properties is generally 15 years from occupancy following construction or rehabilitation completion.When Project Partnerships reach the end of their Tax Credit compliance period, Gateway initiates the process of disposing of its investment in the Project Partnership; the objective of the process is to sell Gateway’s interest in the properties for fair market value and ultimately, when Gateway’s last Project Partnership investment is sold, liquidate Gateway. Generally, the market for Project Partnerships is limited. Some of the factors which negatively impact the marketability of these projects include (1) requirements by government agencies that the project’s mortgagor continue to maintain the property in the low-income housing program, and (2) the mortgage balance of the property is very near the initial balance as a result of the heavily subsidized debt of the Project Partnerships and lengthy (usually 50 year) amortization periods.

As of March 31, 2011, Gateway holds a limited partner interest in 112 Project Partnerships which own and operate government assisted multi-family housing complexes. Gateway at one time held investments in 133 Project Partnerships. As of December 31, 2010, all of the Project Partnerships had reached the end of their Tax Credit compliance period. As of March 31, 2011, 21 of the Project Partnerships have been sold (14 in Series 7, 3 in Series 8, 2 in Series 9, 1 in Series 10 and 1 in Series 11) and, in accordance with the Gateway partnership agreement, the entire net proceeds received from these sales either have been or will be distributed to the Limited Partners of the respective Series. A summary of the sale transactions for the Project Partnerships disposed during the past three fiscal years are summarized below:

Fiscal Year 2011 Disposition Activity:

Series 7

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
August 2010	Pioneer Apartments, L.P.	$	157,949	$	15.19	$	157,949
December 2010	Lake Village Apartments		65,124		6.27		65,124
December 2010	Savannah Park of Atoka		65,125		6.27		65,125
December 2010	Savannah Park of Coalgate		65,125		6.27		65,125
December 2010	Cardinal Apartments		272,071		26.17		187,362
						$	540,685

The net proceeds per LP unit from the sale of Pioneer Apartments, Lake Village Apartments, Savannah Park of Atoka, Savannah Park of Coalgate and Cardinal Apartments are a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 7 Limited Partners in a subsequent period at such time that state withholding tax liabilities have been settled.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

As of March 31, 2010, Gateway holds a limited partner interest in 119 Project Partnerships which own and operate government assisted multi-family housing complexes. Gateway at one time held investments in 133 Project Partnerships. As of December 31, 2009, only 8 of the Project Partnerships have yet to reach the end of their Tax Credit compliance period but will do so in the year ending December 31, 2010. As of March 31, 2010, 14 of the Project Partnerships have been sold (9 in Series ~~7, 3 in Series~~ 8, 1 in Series 9, and 1 in Series 10) and, in accordance with the Gateway partnership agreement, the entire net proceeds received from these sales either have been or will be distributed to the Limited Partners of the respective Series. A summary of the sale transactions for the Project Partnerships disposed during the past three fiscal years are summarized below:

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
	Other, net (see below)	$	-	$	-	$	4,000
						$	4,000

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $4,000 resulting from the true-up of certain legal and other sale transaction closing expenses arising from Project Partnership sale transactions which closed in the prior fiscal year. This amount, less the applicable state tax withholding, will be distributed to the Series 8 Limited Partners in a subsequent period at such time that state withholding tax liabilities have been settled.

Series 9

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
September 2010	Stilwell Properties III	$	43,030	$	6.88	$	43,030
	Other, net (see below)		-		-		2,000
						$	45,030

The net proceeds per LP unit from the sale of Stilwell Properties III is a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 9 Limited Partners in a subsequent period at such time that state withholding tax liabilities have been settled.

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $2,000 resulting from the true-up of certain legal and other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This amount, less the applicable state tax withholding, will be distributed to the Series 9 Limited Partners in a subsequent period at such time that state withholding tax liabilities have been settled.

Series 10

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
	Other, net (see below)	$	-	$	-	$	2,000
						$	2,000

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $2,000 resulting from the true-up of certain legal and other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This amount, less the applicable state tax withholding, will be distributed to the Series 10 Limited Partners in a subsequent period at such time that state withholding tax liabilities have been settled.

Series 11

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
December 2010	Cardinal Apartments	$	175,667	$	34.26	$	125,774
						$	125,774

The net proceeds per LP unit from the sale of Cardinal Apartments is a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 11 Limited Partners in a subsequent period at such time that state withholding tax liabilities have been settled.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Fiscal Year 2010 Disposition Activity:

Series 7

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
August 2009	Mountain City Manor	$	36,860	$	3.54	$	38,190
August 2009	Tazewell Village		41,290		3.97		42,620
August 2009	Jamestown Village		36,450		3.51		37,864
August 2009	Clinch View Manor		134,400		12.93		135,814
May 2009	Spring Creek Apartments II LP		46,520		4.48		46,030
						$	300,518

The net proceeds per LP unit from the sale of Mountain City Manor, Tazewell Village, Jamestown Village, Clinch View Manor, and Spring Creek Apartments II LP were distributed to the Series 7 Limited Partners in September 2009.

Series 8

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
January 2010	South Brenchley	$	13,000	$	1.30	$	13,000
January 2010	Cimmaron Station		10,000		1.00		10,000
						$	23,000

The net proceeds per LP unit from the sale of South Brenchely and Cimmaron Station are a component of the Distribution Payable on the Balance Sheet as of March 31, 2010. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 8 Limited Partners in a subsequent ~~quarter~~period at such time that state withholding tax liabilities have been settled.

Series 9

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
January 2010	Mountain Glen	$	10,000	$	1.59	$	10,000
						$	10,000

The net proceeds per LP unit from the sale of Mountain Glen are a component of the Distribution Payable on the Balance Sheet as of March 31, 2010. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 9 Limited Partners in a subsequent ~~quarter~~period at such time that state withholding tax liabilities have been settled.

Series 10

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
January 2010	Redstone	$	10,000	$	1.98	$	10,000
						$	10,000

The net proceeds per LP unit from the sale of Redstone are a component of the Distribution Payable on the Balance Sheet as of March 31, 2010. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 10 Limited Partners in a subsequent ~~quarter~~period at such time that state withholding tax liabilities have been settled.

1920

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Fiscal Year 2009 Disposition Activity:

Series 7

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
September 2008	Cedar Hollow Apartments	$	9,741	$	0.94	$	9,741
September 2008	Sunrise I Apartments		14,741		1.42		14,741
September 2008	Burbank Apartments		9,502		0.91		9,502
September 2008	Walnut Apartments		9,441		0.91		9,441
						$	43,425

The net proceeds per LP unit from the sale of Cedar Hollow Apartments, Sunrise I Apartments, Burbank Apartments, and Walnut Apartments were distributed to the Series 7 Limited Partners in December 2008.

Series 8

Transaction				Net Proceeds		Gain on
Month / Year	Project Partnership	Net Proceeds		Per LP Unit		Disposal
	Other, net (see below)	$	-	$	-	$	349
						$	349

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $349 resulting from the true-up of certain legal and other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This amount, less the applicable state tax withholding, will be distributed to the Series 8 Limited Partners in a subsequent ~~quarter~~period at such time that state withholding tax liabilities have been settled.

Fiscal Year 2008 Disposition Activity:

Series 8

Transaction			Net Proceeds	Gain on
Month / Year	Project Partnership	Net Proceeds	Per LP Unit	Disposal
March 2008	Morningside Villa	$ 68,000	$ 6.81	$ 68,000
				$ 68,000

The net proceeds per LP unit from the sale of Morningside Villa are a component of the Distribution Payable on the Balance Sheet as of March 31, 2008. These net proceeds were distributed to the Series 8 Limited Partners in September 2008.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Status Update on Unsold Project Partnerships:

The following summarizes the most recent status of the sale/disposal process for the Project Partnership investments held as of March 31, ~~2010~~2011:

~~Gateway~~Project ~~has~~Partnerships ~~approved~~sold ~~the~~subsequent ~~sale~~ to ~~the~~March ~~general~~31, ~~partner of the Project Partnership or a third party~~2011:

Series 7

~~Mt.~~Blue ~~Vernon~~Ridge ~~Rental~~Elderly Housing, Ltd., L.P. ~~Meadow Run Apartments, LP~~ Lakeland II, LPL.P. ~~Blue~~Meadow ~~Ridge~~Run ~~Elderly Housing~~Apartments, ~~Ltd.,~~ L.P. ~~Horton~~Mt. Vernon Rental Housing, L.P. ~~Atoka Properties Coalgate Properties~~

~~These~~Subsequent ~~approvals~~to ~~are~~the ~~subject~~March to31, a2011 ~~number~~year-end, ofGateway ~~contingencies,~~sold ~~the~~its ~~outcome~~partnership ofinterests ~~which~~in ~~cannot~~Blue beRidge ~~predicted~~Elderly ~~with~~Housing, ~~certainty~~Ltd. ~~However~~, ~~utilizing~~L.P., ~~the~~Lakeland ~~sales~~II, ~~amounts~~L.P. asMeadow ~~approved~~Run byApartments, ~~Gateway~~L.P., ~~should~~and ~~all~~Mt. ~~the~~Vernon ~~transactions~~Rental ~~close~~Housing, ~~without~~L.P. Gateway ~~modification,~~received ~~the~~approximately ~~estimated~~$114,400 in net proceeds to(approximately ~~Gateway~~$11.01 ~~from~~per beneficial assignee certificate) which also approximates the ~~sales~~gain ofon ~~these~~sale of Project Partnerships. The ~~are~~gain ~~estimated~~will to be ~~$295,000,~~recognized orin ~~$28.38~~the ~~per~~first ~~limited~~quarter ~~partnership~~of ~~unit. Sales~~fiscal ~~proceeds~~year ~~would~~2012 beand available ~~for~~proceeds ~~distribution~~from these sale transactions, less the applicable state tax withholding, will be distributed to the Series 7 ~~Limited~~Assignees ~~Partners~~in a subsequent toperiod ~~the~~at ~~closing~~such oftime ~~these~~that ~~sales~~state ~~transactions~~withholding ~~which~~tax ~~would~~liabilities ~~most~~have ~~likely~~been ~~occur within the next two years~~settled.

Series 8

~~Antlers~~Cottondale ~~Properties~~Rental ~~Antlers Properties II AAA Properties of Bentonville Meadowview Properties Limited Partnership Concordia Senior~~ Housing, L.P. ~~Holdenville Properties Kirksville Senior Apartments, Limited Partnership Mountainburg Properties Wetumka Properties~~

~~These~~Subsequent ~~approvals are subject~~ to athe ~~number~~March of31, ~~contingencies~~2011 year-end, ~~the~~Gateway ~~outcome~~sold ofits ~~which~~partnership ~~cannot~~interests bein ~~predicted~~Cottondale ~~with~~Rental ~~certainty~~Housing, L.P. ~~However,~~Gateway ~~utilizing~~received ~~the~~approximately ~~sales~~$20,000 ~~amounts~~in asnet ~~approved~~proceeds by(approximately ~~Gateway,~~$2.00 ~~should~~per ~~all~~beneficial ~~the~~assignee ~~transactions~~certificate) ~~close~~which ~~without~~also ~~modification,~~approximates the ~~estimated~~gain ~~net~~on ~~proceeds~~sale ~~to Gateway from the sales~~ of ~~these~~ Project Partnerships. The ~~are~~gain ~~estimated~~will to be ~~$630,000,~~recognized orin ~~$63.13~~the ~~per~~first ~~limited~~quarter ~~partnership~~of ~~unit. Sales~~fiscal ~~proceeds~~year ~~would~~2012 beand available ~~for~~proceeds ~~distribution~~from this sale transaction, less the applicable state tax withholding, will be distributed to the Series 8 ~~Limited~~Assignees ~~Partners~~in a subsequent toperiod ~~the~~at ~~closing~~such oftime ~~these~~that ~~sales~~state ~~transactions~~withholding ~~which~~tax ~~would~~liabilities ~~most~~have ~~likely~~been ~~occur within the next two years~~settled.

Series 9

Arbor Trace Apartments Phase I LP Arbor Trace Apartments Phase II LP Abernathy Properties Boxwood Place Properties Lamar Properties, L.P. Stilwell Properties III Jay Properties II

These approvals are subject to a number of contingencies, the outcome of which cannot be predicted with certainty. However, utilizing the sales amounts as approved by Gateway, should all the transactions close without modification, the estimated net proceeds to Gateway from the sales of these Project Partnerships are estimated to be $350,000, or $55.96 per limited partnership unit. Sales proceeds would be available for distribution, less the applicable state tax withholding, to the Series 9 Limited Partners subsequent to the closing of these sales transactions which would most likely occur within the next two years.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Series 9

Arbor Trace Apartments Phase I L.P.

Arbor Trace Apartments Phase II L.P.

Subsequent to the March 31, 2011 year-end, Gateway sold its partnership interests in Arbor Trace Apartments Phase I L.P. and Arbor Trace Apartments Phase II L.P. Gateway received approximately $52,800 in net proceeds (approximately $8.44 per beneficial assignee certificate) which also approximates the gain on sale of Project Partnerships. The gain will be recognized in the first quarter of fiscal year 2012 and available proceeds from these sale transactions, less the applicable state tax withholding, will be distributed to the Series 9 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

Gateway has approved the sale to the general partner of the Project Partnership or a third party:

Series 8

Antlers Properties	Logan Heights, Ltd.
AAA Properties of Bentonville	Meadowview Properties Limited Partnership
Concordia Senior Housing, L.P.	Mountainburg Properties
Kirksville Senior Apartments, Limited Partnership	Wetumka Properties

These approvals are subject to a number of contingencies, the outcome of which cannot be predicted with certainty. However, utilizing the sales amounts as approved by Gateway, should all the transactions close without modification, the estimated net proceeds to Gateway from the sales of these Project Partnerships are estimated to be $572,000, or $57.31 per limited partnership unit. Sales proceeds would be available for distribution, less the applicable state tax withholding, to the Series 8 Limited Partners in a period subsequent to the closing of these sales transactions which would most likely occur within the next two years.

Series 9

Abernathy Properties	Jay Properties II
Boxwood Place Properties	Lamar Properties, L.P.

These approvals are subject to a number of contingencies, the outcome of which cannot be predicted with certainty. However, utilizing the sales amounts as approved by Gateway, should all the transactions close without modification, the estimated net proceeds to Gateway from the sales of these Project Partnerships are estimated to be $260,000, or $41.57 per limited partnership unit. Sales proceeds would be available for distribution, less the applicable state tax withholding, to the Series 9 Limited Partners in a period subsequent to the closing of these sales transactions which would most likely occur within the next two years.

Series 10

Stigler Properties

This approval is subject to a number of contingencies, the outcome of which cannot be predicted with certainty. However, utilizing the ~~sales~~sale amount as approved by Gateway, should the transaction close without modification, the estimated net proceeds to Gateway from the sale of this Project Partnership ~~are~~is estimated to be $54,000, or $10.71 per limited partnership unit. Sales proceeds would be available for distribution, less the applicable state tax withholding, to the Series 10 Limited Partners in a period subsequent to the closing of this sales transaction which would most likely occur within the next two years.

~~Gateway has consented to the general partner granting an option for either the general partner or a third-party to purchase either the Project Partnership Interest or Assets:~~22

~~Series~~Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Pioneer Apartments, an Arkansas Limited Partnership

Should this option be exercised, the estimated net sales proceeds to Gateway from the sales transaction are estimated to be $157,000, or $15.10 per limited partnership unit potentially available for distribution, less the applicable state tax withholding, to the Series 7 Limited Partners within the next two years. This option to purchase could expire without being exercised which would result in no sales proceeds and remarketing of the Project Partnership, the results of which are undeterminable.

Gateway is exploring options regarding the sale or other disposition of the remaining Project Partnership investments that have exited their Tax Credit compliance period and are not specifically listed above. Any net proceeds arising from these particular Project Partnerships are anticipated to be minimal.

Disclosure of Contractual Obligations

		Payment due by period
		Less than			More than
Contractual Obligations	Total	1 year	1-3 years	3-5 years	5 years
Long-Term Debt Obligations
Capital Lease Obligations
Operating Lease Obligations
Purchase Obligations
Other Liabilities Reflected on the
Registrant’s Balance Sheet under GAAP	$3,~~363~~558,~~915~~251 (1)	~~457~~275,~~129~~799	23,~~906~~282,~~786~~452	0-	0-

(1) The Other Liabilities represent the asset management fees and other general and administrative expense reimbursements owed to the General Partners as of March 31, ~~2010~~2011. This payable is unsecured, due on demand and, in accordance with the limited partnership agreement, non-interest bearing. As referred to in Note 43, the Managing General Partner does not intend to demand payment of the portion of this balance reflected as due later than one year within the next twelve months.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

As a smaller reporting company, no information is required.

2223

Item 8. Financial Statements and Supplementary Data

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Partners of Gateway Tax Credit Fund III Ltd.

We have audited the accompanying balance sheets of Gateway Tax Credit Fund III Ltd. (a Florida Limited Partnership) –- Series 7 through 11, in total and for each series, as of March 31, ~~2010~~2011 and ~~2009~~2010, and the related statements of operations, partners’ equity (deficit), and cash flows for the total partnership and for each of the series for each of the years in the three-year period ended March 31, ~~2010~~2011. Gateway’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Gateway is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Gateway’s internal control over financial reporting. Accordingly we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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 Gateway Tax Credit Fund III Ltd. –- Series 7 through 11, in total and for each series, as of March 31, ~~2010~~2011 and ~~2009~~2010, and the results of its operations and its cash flows for the total partnership and for each of the series for each of the years in the three-year period ended March 31, ~~2010~~2011, in conformity with accounting principles generally accepted in the United States of America.

Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The schedules listed under Item 15(a)(2) in the index are presented for purposes of complying with the Securities and Exchange Commission's rules and are not part of the basic financial statements. These schedules have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, based on our audits and the reports of other auditors, fairly state in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole.

/s/ Reznick Group, P.C.

REZNICK GROUP, P.C.

Atlanta, Georgia

July 1, ~~2010~~2011

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

BALANCE SHEETS

	SERIES 7		SERIES 8		SERIES 9
	March 31,	March 31,	March 31,	March 31,	March 31,	March 31,
	2010	2009	2010	2009	2010	2009
ASSETS
Current Assets:
Cash and Cash Equivalents	$ 209,702	$ 246,867	$ 238,988	$ 185,918	$ 96,912	$ 124,326
Total Current Assets	209,702	246,867	238,988	185,918	96,912	124,326
Investments in Project Partnerships, net	84,017	88,308	-	15,007	-	9,681
Total Assets	$ 293,719	$ 335,175	$ 238,988	$ 200,925	$ 96,912	$ 134,007
LIABILITIES AND PARTNERS' DEFICIT
Current Liabilities:
Payable to General Partners	$ 105,464	$ 61,563	$ 215,965	$ 171,880	$ 66,214	$ 31,416
Distribution Payable	5,066	78	23,385	385	10,000	-
Total Current Liabilities	110,530	61,641	239,350	172,265	76,214	31,416
Long-Term Liabilities:
Payable to General Partners	963,160	895,972	1,034,764	948,984	624,387	575,799
Partners' Equity (Deficit):
Limited Partners - 10,395, 9,980, and 6,254
units for Series 7, 8, and 9, respectively,
at March 31, 2010 and 2009	(782,420)	(568,361)	(1,028,499)	(891,845)	(552,816)	(413,640)
General Partners	2,449	(54,077)	(6,627)	(28,479)	(50,873)	(59,568)
Total Partners' Deficit	(779,971)	(622,438)	(1,035,126)	(920,324)	(603,689)	(473,208)
Total Liabilities and Partners' Deficit	$ 293,719	$ 335,175	$ 238,988	$ 200,925	$ 96,912	$ 134,007

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

BALANCE SHEETS

	SERIES 10				SERIES 11				TOTAL SERIES 7 - 11
		SERIES 7								SERIES 8						SERIES 9
	~~March 31,~~	March 31,	~~March 31,~~		~~March 31,~~	March 31,	~~March 31,~~		~~March 31,~~	March 31,	~~March 31,~~		March 31,			March 31,			March 31,
	2010		2009		2010		2009		2010		2009
		2011				2010				2011			2010			2011			2010
ASSETS
Current Assets:
Cash and Cash Equivalents	~~$ 153,638~~	$	~~$ 121~~770,~~062~~297		~~$ 209,968~~	$	~~$ 204~~209,~~816~~702		~~$ 909,208~~	$	~~$ 882~~231,~~989~~397		$	238,988		$	142,196		$	96,912
Investments in Securities	-		38,104		-		41,233		-		79,337
Total Current Assets			770,297				209,702				231,397			238,988			142,196			96,912
Total Current Assets	153,638		159,166		209,968		246,049		909,208		962,326
Investments in Project Partnerships, net			-				84,017				-			-			-			-
Investments in Project Partnerships, net	97,267		136,408		411,872		536,485		593,156		785,889
Total Assets		$	770,297			$	293,719			$	231,397		$	238,988		$	142,196		$	96,912
Total Assets	$ 250,905		$ 295,574		$ 621,840		$ 782,534		$ 1,502,364		$ 1,748,215
LIABILITIES AND PARTNERS' DEFICIT
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
Current Liabilities:
Current Liabilities:
Payable to General Partners		$	6,174			$	105,464			$	183,126		$	215,965		$	55,327		$	66,214
Payable to General Partners	$ 54,975		$ 32,774		$ 14,511		$ 15,049		$ 457,129		$ 312,682
Distribution Payable			545,751				5,066				27,385			23,385			55,030			10,000
Distribution Payable	10,000		-		-		-		48,451		463
Total Current Liabilities			551,925				110,530				210,511			239,350			110,357			76,214
Total Current Liabilities	64,975		32,774		14,511		15,049		505,580		313,145
Long-Term Liabilities:
Long-Term Liabilities:
Payable to General Partners			1,065,589				963,160				1,150,230			1,034,764			690,195			624,387
Payable to General Partners	179,311		145,887		105,164		77,040		2,906,786		2,643,682
Partners' (Deficit) Equity:
Partners' Equity (Deficit):
Limited Partners - 10,395, 9,980, and 6,254
Limited Partners - 5,043 and 5,127 units
units for Series 7, 8, and 9, respectively,
for Series 10 and 11, respectively, at
at March 31, 2011 and 2010			(854,401	)			(782,420	)			(1,125,775	)		(1,028,499	)		(651,966	)		(552,816	)
March 31, 2010 and 2009	40,732		159,923		543,134		729,531		(1,779,869)		(984,392)
General Partners			7,184				2,449				(3,569	)		(6,627	)		(6,390	)		(50,873	)
General Partners	(34,113)		(43,010)		(40,969)		(39,086)		(130,133)		(224,220)
Total Partners' Deficit			(847,217	)			(779,971	)			(1,129,344	)		(1,035,126	)		(658,356	)		(603,689	)
Total Partners' Equity (Deficit)	6,619		116,913		502,165		690,445		(1,910,002)		(1,208,612)
Total Liabilities and Partners' Deficit		$	770,297			$	293,719			$	231,397		$	238,988		$	142,196		$	96,912
Total Liabilities and Partners' Equity (Deficit)	$ 250,905		$ 295,574		$ 621,840		$ 782,534		$ 1,502,364		$ 1,748,215

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

~~STATEMENTS~~BALANCE ~~OF OPERATIONS~~SHEETS

FOR THE YEARS ENDED MARCH 31, 2010, 2009 AND 2008

	SERIES 10						SERIES 11					TOTAL SERIES 7 - 11
	March 31,			March 31,			March 31,		March 31,			March 31,			March 31,
	2011			2010			2011		2010			2011			2010
ASSETS
Current Assets:
Cash and Cash Equivalents	$	153,660		$	153,638		$	356,285	$	209,968		$	1,653,835		$	909,208
Total Current Assets		153,660			153,638			356,285		209,968			1,653,835			909,208

Investments in Project Partnerships, net		64,697			97,267			245,863		411,872			310,560			593,156

Total Assets	$	218,357		$	250,905		$	602,148	$	621,840		$	1,964,395		$	1,502,364

LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
Current Liabilities:
Payable to General Partners	$	27,005		$	54,975		$	4,167	$	14,511		$	275,799		$	457,129
Distribution Payable		12,000			10,000			125,774		-			765,940			48,451

Total Current Liabilities		39,005			64,975			129,941		14,511			1,041,739			505,580

Long-Term Liabilities:
Payable to General Partners		235,562			179,311			140,876		105,164			3,282,452			2,906,786

Partners' (Deficit) Equity:
Limited Partners - 5,043 and 5,127 units
for Series 10 and 11, respectively, at
March 31, 2011 and 2010		(23,468	)		40,732			330,500		543,134			(2,325,110	)		(1,779,869	)
General Partners		(32,742	)		(34,113	)		831		(40,969	)		(34,686	)		(130,133	)

Total Partners' (Deficit) Equity		(56,210	)		6,619			331,331		502,165			(2,359,796	)		(1,910,002	)

Total Liabilities and Partners' Equity (Deficit)	$	218,357		$	250,905		$	602,148	$	621,840		$	1,964,395		$	1,502,364

	SERIES 7			SERIES 8
	2010	2009	2008	2010	2009	2008
Revenues:
Distribution Income	$ 31,189	$ 26,416	$ 36,085	$ 23,800	$ 18,335	$ 29,379
Total Revenues	31,189	26,416	36,085	23,800	18,335	29,379
Expenses:
Asset Management Fee - General Partner	67,188	80,024	85,596	85,780	86,288	89,020
General and Administrative:
General Partner	82,933	114,225	124,429	-	130,191	136,878
Other	38,336	42,989	38,388	40,376	45,703	39,031
Amortization	291	5,014	25,935	1,156	11,073	13,138
Impairment Loss on Investment in Project Partnerships	-	183,299	99,867	8,681	221,243	31,346
Total Expenses	188,748	425,551	374,215	135,993	494,498	309,413
Loss Before Equity in Income (Loss) of Project Partnerships
and Other Income	(157,559)	(399,135)	(338,130)	(112,193)	(476,163)	(280,034)
Equity in Income (Loss) of Project Partnerships	-	707	(28,789)	(2,631)	(45,239)	(54,012)
Gain on Sale of Project Partnerships	300,518	43,425	-	23,000	349	68,000
Interest Income	26	5,922	21,272	22	3,637	14,394
Net Income (Loss)	$ 142,985	$ (349,081)	$ (345,647)	$ (91,802)	$ (517,416)	$ (251,652)
Allocation of Net Income (Loss):
Limited Partners	$ 86,459	$ (388,581)	$ (342,191)	$ (113,654)	$ (512,587)	$ (316,456)
General Partners	56,526	39,500	(3,456)	21,852	(4,829)	64,804
	$ 142,985	$ (349,081)	$ (345,647)	$ (91,802)	$ (517,416)	$ (251,652)
Net Income (Loss) Per Limited Partnership Unit	$ 8.32	$ (37.38)	$ (32.92)	$ (11.39)	$ (51.36)	$ (31.71)
Number of Limited Partnership Units Outstanding	10,395	10,395	10,395	9,980	9,980	9,980

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 9						SERIES 10
		SERIES 7											SERIES 8
	2010		2009		2008		2010		2009		2008
		2011				2010				2009			2011			2010			2009
Revenues:
Distribution Income	~~$ 15,862~~	$	~~$ 10~~23,~~038~~473		~~$ 8,514~~	$	~~$ 8~~31,~~658~~189		~~$ 12,302~~	$	~~$ 2~~26,~~129~~416		$	24,662		$	23,800		$	18,335
Total Revenues	~~15,862~~		1023,~~038~~473		~~8,514~~		831,~~658~~189		~~12,302~~		226,~~129~~416			24,662			23,800			18,335
Expenses:
Asset Management Fee - General Partner	~~48,589~~		4857,~~840~~429		~~49,068~~		3367,~~424~~188		~~33,584~~		3380,~~536~~024			80,466			85,780			86,288
General and Administrative:
General Partner	~~62,259~~		~~74,395~~-		~~76,571~~		3882,~~620~~933		~~46,497~~		47114,~~857~~225			-			-			130,191
Other	~~27,603~~		3033,~~605~~183		~~25,996~~		1938,~~824~~336		~~21,098~~		1842,~~653~~989			38,442			40,376			45,703
Amortization	~~2,993~~		~~10,045~~146		~~12,053~~		~~667~~291		~~20,914~~		245,~~106~~014			-			1,156			11,073
Impairment Loss on Investment in Project Partnerships	-		~~180,400~~-		-		-		~~506,918~~		~~376~~183,~~185~~299			-			8,681			221,243
Total Expenses	~~141,444~~		~~344~~90,~~285~~758		~~163,688~~		92188,~~535~~748		~~629,011~~		~~500~~425,~~337~~551			118,908			135,993			494,498
Loss Before Equity in (Loss) Income of Project Partnerships
Loss Before Equity in Income (Loss) of Project Partnerships
and Other Income	~~(125,582)~~		(~~334~~67,~~247)~~285	)	~~(155,174)~~		(83157,~~877)~~559	)	~~(616,709)~~		(~~498~~399,~~208)~~135	)		(94,246	)		(112,193	)		(476,163	)
Equity in (Loss) Income of Project Partnerships	(4,909)		(87,688)		(100,405)		(28,325)		796		(75,336)
Equity in Income (Loss) of Project Partnerships			-				-				707			-			(2,631	)		(45,239	)
Gain on Sale of Project Partnerships	~~10,000~~		-540,685		-		10300,~~000~~518		-		-43,425			4,000			23,000			349
Interest Income	10		~~4,979~~39		~~12,856~~		~~1,908~~26		~~6,238~~		115,~~970~~922			28			22			3,637
Net Loss	$ (120,481)		$ (416,956)		$ (242,723)		$ (100,294)		$ (609,675)		$ (561,574)
Net Income (Loss)		$	473,439			$	142,985			$	(349,081	)	$	(90,218	)	$	(91,802	)	$	(517,416	)
Allocation of Net (Loss) Income:
Allocation of Net Income (Loss):
Limited Partners	~~$ (129,176)~~	$	~~$ (412~~468,~~786)~~704		~~$ (240,296)~~	$	~~$ (109~~86,~~191)~~459		~~$ (603,578)~~	$	$ (~~555~~388,~~958)~~581	)	$	(93,276	)	$	(113,654	)	$	(512,587	)
General Partners	~~8,695~~		(4,~~170)~~735		~~(2,427)~~		856,~~897~~526		~~(6,097)~~		(539,~~616)~~500			3,058			21,852			(4,829	)
	$ (120,481)		$ (416,956)		$ (242,723)		$ (100,294)		$ (609,675)		$ (561,574)
		$	473,439			$	142,985			$	(349,081	)	$	(90,218	)	$	(91,802	)	$	(517,416	)
Net Loss Per Limited Partnership Unit	$ (20.65)		$ (66.00)		$ (38.42)		$ (21.65)		$ (119.69)		$ (110.24)
Net Income (Loss) Per Limited Partnership Unit		$	45.09			$	8.32			$	(37.38	)	$	(9.35	)	$	(11.39	)	$	(51.36	)
Number of Limited Partnership Units Outstanding	~~6,254~~		610,~~254~~395		~~6,254~~		510,~~043~~395		~~5,043~~		510,~~043~~395			9,980			9,980			9,980

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 11						TOTAL SERIES 7 - 11
		SERIES 9											SERIES 10
	2010		2009		2008		2010		2009		2008
		2011				2010				2009			2011			2010			2009
Revenues:
Distribution Income	~~$ 4,207~~	$	~~$ 2~~16,~~182~~002		~~$ 2,782~~	$	~~$ 83~~15,~~716~~862		~~$ 69,273~~	$	~~$ 78~~10,~~889~~038		$	12,943		$	8,658		$	12,302
Total Revenues	~~4,207~~		216,~~182~~002		~~2,782~~		8315,~~716~~862		~~69,273~~		7810,~~889~~038			12,943			8,658			12,302
Expenses:
Asset Management Fee - General Partner	~~28,124~~		2845,~~352~~797		~~28,699~~		~~263~~48,~~105~~589		~~277,088~~		~~285~~48,~~919~~840			31,251			33,424			33,584
General and Administrative:
General Partner	~~34,766~~		~~37,198~~-		~~38,286~~		~~218~~62,~~578~~259		~~402,506~~		~~424~~74,~~021~~395			-			38,620			46,497
Other	~~19,855~~		2124,~~108~~886		~~18,749~~		~~145~~27,~~994~~603		~~161,503~~		~~140~~30,~~817~~605			18,870			19,824			21,098
Amortization	~~12,518~~		~~28,981~~-		~~33,497~~		172,~~625~~993		~~76,027~~		~~108~~10,~~729~~045			-			667			20,914
Impairment Loss on Investment in Project Partnerships	~~19,418~~		~~248,250~~-		~~454,605~~		~~28,099~~-		~~1,340,110~~		~~962~~180,~~003~~400			-			-			506,918
Total Expenses	~~114,681~~		~~363~~70,~~889~~683		~~573,836~~		~~673~~141,~~401~~444		~~2,257,234~~		1344,~~921,489~~285			50,121			92,535			629,011
Loss Before Equity in Loss of Project Partnerships
Loss Before Equity in (Loss) Income of Project Partnerships
and Other Income	~~(110,474)~~		(~~361~~54,~~707)~~681	)	~~(571,054)~~		(~~589~~125,~~685)~~582	)	~~(2,187,961)~~		(1334,~~842,600)~~247	)		(37,178	)		(83,877	)		(616,709	)
Equity in Loss of Project Partnerships	(80,592)		(115,651)		(74,752)		(116,457)		(247,075)		(333,294)
Equity in (Loss) Income of Project Partnerships			-				(4,909	)			(87,688	)		(25,669	)		(28,325	)		796
Gain on Sale of Project Partnerships	-		-45,030		-		~~343~~10,~~518~~000		~~43,774~~		~~68,000~~-			2,000			10,000			-
Interest Income	~~2,786~~		~~9,283~~14		~~17,029~~		~~4,752~~10		~~30,059~~		774,~~521~~979			18			1,908			6,238
Net Loss	~~$ (188,280)~~	$	$ (~~468~~9,~~075)~~637	)	~~$ (628,777)~~	$	$ (~~357~~120,~~872)~~481	)	~~$ (2,361,203)~~	$	$ (2416,~~030,373)~~956	)	$	(60,829	)	$	(100,294	)	$	(609,675	)
Allocation of Net (Loss) Income:
Allocation of Net (Loss) Income
Limited Partners	~~$ (186,397)~~	$	$ (~~463~~54,~~394)~~120	)	~~$ (622,489)~~	$	$ (~~451~~129,~~959)~~176	)	~~$ (2,380,926)~~	$	$ (2412,~~077,390)~~786	)	$	(62,200	)	$	(109,191	)	$	(603,578	)
General Partners	~~(1,883)~~		(444,~~681)~~483		~~(6,288)~~		948,~~087~~695		~~19,723~~		47(4,~~017~~170	)		1,371			8,897			(6,097	)
	$ (188,280)		$ (468,075)		$ (628,777)		$ (357,872)		$ (2,361,203)		$ (2,030,373)
		$	(9,637	)		$	(120,481	)		$	(416,956	)	$	(60,829	)	$	(100,294	)	$	(609,675	)
Net Loss Per Limited Partnership Unit	~~$ (36.36)~~	$	$ (908.~~38)~~65	)	~~$ (121.41)~~	$	(20.65	)		$	(66.00	)	$	(12.33	)	$	(21.65	)	$	(119.69	)
Number of Limited Partnership Units Outstanding	~~5,127~~		56,~~127~~254		~~5,127~~		6,254				6,254			5,043			5,043			5,043

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF ~~PARTNERS' EQUITY (DEFICIT)~~OPERATIONS

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 7						SERIES 8
		SERIES 11											TOTAL SERIES 7 - 11
	Limited		General				Limited		General
		2011				2010				2009			2011			2010			2009
	Partners		Partners		Total		Partners		Partners		Total
Revenues:
Balance at March 31, 2007	$ 205,836		$ (90,121)		$ 115,715		$ 5,547		$ (88,454)		$ (82,907)
Distribution Income		$	3,607			$	4,207			$	2,182		$	80,687		$	83,716		$	69,273
Net (Loss) Income	(342,191)		(3,456)		(345,647)		(316,456)		64,804		(251,652)
Total Revenues			3,607				4,207				2,182			80,687			83,716			69,273
Distributions	-		-		-		(68,000)		-		(68,000)
Expenses:
Balance at March 31, 2008	(136,355)		(93,577)		(229,932)		(378,909)		(23,650)		(402,559)
Asset Management Fee - General Partner			27,711				28,124				28,352			242,654			263,105			277,088
Net (Loss) Income	(388,581)		39,500		(349,081)		(512,587)		(4,829)		(517,416)
General and Administrative:
Distributions	(43,425)		-		(43,425)		(349)		-		(349)
General Partner			20,774				34,766				37,198			20,774			218,578			402,506
Balance at March 31, 2009	(568,361)		(54,077)		(622,438)		(891,845)		(28,479)		(920,324)
Other			18,904				19,855				21,108			134,285			145,994			161,503
Net Income (Loss)	86,459		56,526		142,985		(113,654)		21,852		(91,802)
Amortization			-				12,518				28,981			146			17,625			76,027
Distributions	(300,518)		-		(300,518)		(23,000)		-		(23,000)
Impairment Loss on Investment in Project Partnerships			-				19,418				248,250			-			28,099			1,340,110
Balance at March 31, 2010	$ (782,420)		$ 2,449		$ (779,971)		$ (1,028,499)		$ (6,627)		$ (1,035,126)
Total Expenses			67,389				114,681				363,889			397,859			673,401			2,257,234
Loss Before Equity in Loss of Project Partnerships
and Other Income			(63,782	)			(110,474	)			(361,707	)		(317,172	)		(589,685	)		(2,187,961	)
Equity in Loss of Project Partnerships			(107,077	)			(80,592	)			(115,651	)		(132,746	)		(116,457	)		(247,075	)
Gain on Sale of Project Partnerships			125,774				-				-			717,489			343,518			43,774
Interest Income			25				2,786				9,283			124			4,752			30,059
Net (Loss) Income		$	(45,060	)		$	(188,280	)		$	(468,075	)	$	267,695		$	(357,872	)	$	(2,361,203	)
Allocation of Net (Loss) Income:
Limited Partners		$	(86,860	)		$	(186,397	)		$	(463,394	)	$	172,248		$	(451,959	)	$	(2,380,926	)
General Partners			41,800				(1,883	)			(4,681	)		95,447			94,087			19,723
		$	(45,060	)		$	(188,280	)		$	(468,075	)	$	267,695		$	(357,872	)	$	(2,361,203	)
Net Loss Per Limited Partnership Unit		$	(16.94	)		$	(36.36	)		$	(90.38	)
Number of Limited Partnership Units Outstanding			5,127				5,127				5,127

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF PARTNERS' EQUITY (DEFICIT)

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 9						SERIES 10
		SERIES 7											SERIES 8
	~~Limited~~	Limited	~~General~~			General	~~Limited~~		~~General~~				Limited			General
	~~Partners~~	Partners	~~Partners~~		~~Total~~	Partners	~~Partners~~		~~Partners~~	Total	~~Total~~		Partners			Partners			Total
Balance at March 31, 2007	$ 239,442		$ (52,971)		$ 186,471		$ 1,319,459		$ (31,297)		$ 1,288,162
Balance at March 31, 2008		$	(136,355	)		$	(93,577	)		$	(229,932	)	$	(378,909	)	$	(23,650	)	$	(402,559	)
Net Loss	(240,296)		(2,427)		(242,723)		(555,958)		(5,616)		(561,574)
Net (Loss) Income			(388,581	)			39,500				(349,081	)		(512,587	)		(4,829	)		(517,416	)
Balance at March 31, 2008	(854)		(55,398)		(56,252)		763,501		(36,913)		726,588
Distributions			(43,425	)			-				(43,425	)		(349	)		-			(349	)
Net Loss	(412,786)		(4,170)		(416,956)		(603,578)		(6,097)		(609,675)
Balance at March 31, 2009			(568,361	)			(54,077	)			(622,438	)		(891,845	)		(28,479	)		(920,324	)
Balance at March 31, 2009	(413,640)		(59,568)		(473,208)		159,923		(43,010)		116,913
Net Income (Loss)			86,459				56,526				142,985			(113,654	)		21,852			(91,802	)
Net (Loss) Income	(129,176)		8,695		(120,481)		(109,191)		8,897		(100,294)
Distributions			(300,518	)			-				(300,518	)		(23,000	)		-			(23,000	)
Distributions	(10,000)		-		(10,000)		(10,000)		-		(10,000)
Balance at March 31, 2010			(782,420	)			2,449				(779,971	)		(1,028,499	)		(6,627	)		(1,035,126	)
Balance at March 31, 2010	$ (552,816)		$ (50,873)		$ (603,689)		$ 40,732		$ (34,113)		$ 6,619
Net Income (Loss)			468,704				4,735				473,439			(93,276	)		3,058			(90,218	)
Distributions			(540,685	)			-				(540,685	)		(4,000	)		-			(4,000	)
Balance at March 31, 2011		$	(854,401	)		$	7,184			$	(847,217	)	$	(1,125,775	)	$	(3,569	)	$	(1,129,344	)

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF PARTNERS' EQUITY (DEFICIT)

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 11						TOTAL SERIES 7 - 11
		SERIES 9											SERIES 10
	~~Limited~~	Limited	~~General~~			General	~~Limited~~		~~General~~				Limited			General
	~~Partners~~	Partners	~~Partners~~		~~Total~~	Partners	~~Partners~~		~~Partners~~	Total	~~Total~~		Partners			Partners			Total
Balance at March 31, 2007	$ 1,815,414		$ (28,117)		$ 1,787,297		$ 3,585,698		$ (290,960)		$ 3,294,738
Balance at March 31, 2008		$	(854	)		$	(55,398	)		$	(56,252	)	$	763,501		$	(36,913	)	$	726,588
Net (Loss) Income	(622,489)		(6,288)		(628,777)		(2,077,390)		47,017		(2,030,373)
Net Loss			(412,786	)			(4,170	)			(416,956	)		(603,578	)		(6,097	)		(609,675	)
Distributions	-		-		-		(68,000)		-		(68,000)
Balance at March 31, 2009			(413,640	)			(59,568	)			(473,208	)		159,923			(43,010	)		116,913
Balance at March 31, 2008	1,192,925		(34,405)		1,158,520		1,440,308		(243,943)		1,196,365
Net (Loss) Income			(129,176	)			8,695				(120,481	)		(109,191	)		8,897			(100,294	)
Net (Loss) Income	(463,394)		(4,681)		(468,075)		(2,380,926)		19,723		(2,361,203)
Distributions			(10,000	)			-				(10,000	)		(10,000	)		-			(10,000	)
Distributions	-		-		-		(43,774)		-		(43,774)
Balance at March 31, 2010			(552,816	)			(50,873	)			(603,689	)		40,732			(34,113	)		6,619
Balance at March 31, 2009	729,531		(39,086)		690,445		(984,392)		(224,220)		(1,208,612)
Net (Loss) Income			(54,120	)			44,483				(9,637	)		(62,200	)		1,371			(60,829	)
Net (Loss) Income	(186,397)		(1,883)		(188,280)		(451,959)		94,087		(357,872)
Distributions			(45,030	)			-				(45,030	)		(2,000	)		-			(2,000	)
Distributions	-		-		-		(343,518)		-		(343,518)
Balance at March 31, 2011		$	(651,966	)		$	(6,390	)		$	(658,356	)	$	(23,468	)	$	(32,742	)	$	(56,210	)
Balance at March 31, 2010	$ 543,134		$ (40,969)		$ 502,165		$ (1,779,869)		$ (130,133)		$ (1,910,002)

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF ~~CASH~~PARTNERS' ~~FLOWS~~EQUITY (DEFICIT)

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 7
		SERIES 11										TOTAL SERIES 7 - 11
	2010		2009		2008
		Limited				General						Limited			General
Cash Flows from Operating Activities:
		Partners				Partners			Total			Partners			Partners			Total
Net Income (Loss)	$ 142,985		$ (349,081)		$ (345,647)
Balance at March 31, 2008		$	1,192,925			$	(34,405	)	$	1,158,520		$	1,440,308		$	(243,943	)	$	1,196,365
Adjustments to Reconcile Net Income (Loss) to Net Cash Used in Operating Activities:
Net (Loss) Income			(463,394	)			(4,681	)		(468,075	)		(2,380,926	)		19,723			(2,361,203	)
Amortization	291		5,014		25,935
Distributions			-				-			-			(43,774	)		-			(43,774	)
Impairment Loss on Investment in Project Partnerships	-		183,299		99,867
Balance at March 31, 2009			729,531				(39,086	)		690,445			(984,392	)		(224,220	)		(1,208,612	)
Accreted Interest Income on Investment in Securities	-		-		(5,240)
Net (Loss) Income			(186,397	)			(1,883	)		(188,280	)		(451,959	)		94,087			(357,872	)
Discount on Investment in Securities	-		(1,592)		(627)
Distributions			-				-			-			(343,518	)		-			(343,518	)
Equity in (Income) Loss of Project Partnerships	-		(707)		28,789
Balance at March 31, 2010			543,134				(40,969	)		502,165			(1,779,869	)		(130,133	)		(1,910,002	)
Gain on Sale of Project Partnerships	(300,518)		(43,425)		-
Net (Loss) Income			(86,860	)			41,800			(45,060	)		172,248			95,447			267,695
Distribution Income	(31,189)		(26,416)		(36,085)
Distributions			(125,774	)			-			(125,774	)		(717,489	)		-			(717,489	)
Changes in Operating Assets and Liabilities:
Balance at March 31, 2011		$	330,500			$	831		$	331,331		$	(2,325,110	)	$	(34,686	)	$	(2,359,796	)
Decrease (Increase) in Interest Receivable	-		2,577		(995)
Decrease (Increase) in Receivable - Other	-		696		(696)
Increase in Payable to General Partners	111,089		77,527		89,399
Net Cash Used in Operating Activities	(77,342)		(152,108)		(145,300)
Cash Flows from Investing Activities:
Distributions Received from Project Partnerships	35,189		34,648		40,134
Net Proceeds from Sale of Project Partnerships	300,518		43,425		-
Redemption of Investment Securities	-		362,000		289,000
Purchase of Investment Securities	-		(160,337)		(200,266)
Net Cash Provided by Investing Activities	335,707		279,736		128,868
Cash Flows from Financing Activities:
Distributions Paid to Limited Partners	(295,530)		(43,347)		-
Net Cash Used in Financing Activities	(295,530)		(43,347)		-
(Decrease) Increase in Cash and Cash Equivalents	(37,165)		84,281		(16,432)
Cash and Cash Equivalents at Beginning of Year	246,867		162,586		179,018
Cash and Cash Equivalents at End of Year	$ 209,702		$ 246,867		$ 162,586

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 8
		SERIES 7
	2010		2009		2008
		2011				2010			2009
Cash Flows from Operating Activities:
Net Loss	$ (91,802)		$ (517,416)		$ (251,652)
Net Income (Loss)		$	473,439			$	142,985		$	(349,081	)
Adjustments to Reconcile Net Loss to Net Cash Provided by (Used in) Operating Activities:
Adjustments to Reconcile Net Income (Loss) to Net Cash Used in Operating Activities:
Amortization	~~1,156~~		~~11,073~~146		~~13,138~~		291			5,014
Impairment Loss on Investment in Project Partnerships	~~8,681~~		~~221,243~~-		~~31,346~~		-			183,299
Accreted Interest Income on Investment in Securities	-		-		(4,804)
Discount on Investment in Securities			-				-			(1,592	)
Discount on Investment in Securities	-		(804)		(441)
Equity in Income of Project Partnerships			-				-			(707	)
Equity in Loss of Project Partnerships	2,631		45,239		54,012
Gain on Sale of Project Partnerships			(540,685	)			(300,518	)		(43,425	)
Gain on Sale of Project Partnerships	(23,000)		(349)		(68,000)
Distribution Income			(23,473	)			(31,189	)		(26,416	)
Distribution Income	(23,800)		(18,335)		(29,379)
Changes in Operating Assets and Liabilities:
Changes in Operating Assets and Liabilities:
Decrease in Interest Receivable			-				-			2,577
Decrease in Interest Receivable	-		966		187
Decrease in Receivable - Other			-				-			696
Increase in Payable to General Partners	~~129,865~~		~~161~~3,~~182~~139		~~134,857~~		111,089			77,527
Net Cash Provided by (Used in) Operating Activities	3,731		(97,201)		(120,736)
Net Cash Used in Operating Activities			(87,434	)			(77,342	)		(152,108	)
Cash Flows from Investing Activities:
Distributions Received from Project Partnerships	~~26,339~~		22,~~305~~635		~~36,304~~		35,189			34,648
Net Proceeds from Sale of Project Partnerships	~~23,000~~		~~349~~625,394		~~68,000~~		300,518			43,425
Redemption of Investment Securities	-		~~156,000~~-		~~209,000~~		-			362,000
Purchase of Investment Securities	-		~~(80,169)~~-		~~(75,100)~~		-			(160,337	)
Net Cash Provided by Investing Activities	~~49,339~~		98648,~~485~~029		~~238,204~~		335,707			279,736
Cash Flows from Financing Activities:
Distributions Paid to Limited Partners	-		~~(67,964)~~-		-		(295,530	)		(43,347	)
Net Cash Used in Financing Activities	-		~~(67,964)~~-		-		(295,530	)		(43,347	)
Increase (Decrease) in Cash and Cash Equivalents	~~53,070~~		~~(66~~560,~~680)~~595		~~117,468~~		(37,165	)		84,281
Cash and Cash Equivalents at Beginning of Year	~~185,918~~		~~252~~209,~~598~~702		~~135,130~~		246,867			162,586
Cash and Cash Equivalents at End of Year	~~$ 238,988~~	$	~~$ 185~~770,~~918~~297		~~$ 252,598~~	$	209,702		$	246,867
Supplemental disclosure of non-cash activities:
Increase in Distribution Payable	~~$ 23,000~~	$	~~$ -~~540,685		~~$ 68,000~~	$	-		$	-
Distribution to Limited Partners	~~(23,000)~~		-(540,685	)	~~(68,000)~~		-			-
	$ -		$ -		$ -
		$	-			$	-		$	-

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 9
		SERIES 8
	2010		2009		2008
		2011				2010			2009
Cash Flows from Operating Activities:
Net Loss	~~$ (120,481)~~	$	$ (~~416~~90,~~956)~~218	)	~~$ (242,723)~~	$	(91,802	)	$	(517,416	)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Adjustments to Reconcile Net Loss to Net Cash (Used in) Provided by Operating Activities:
Amortization	~~2,993~~		~~10,045~~-		~~12,053~~		1,156			11,073
Impairment Loss on Investment in Project Partnerships	-		~~180,400~~-		-		8,681			221,243
Accreted Interest Income on Investment in Securities	-		(2,552)		(5,145)
Discount on Investment in Securities			-				-			(804	)
Discount on Investment in Securities	-		(325)		(416)
Equity in Loss of Project Partnerships			-				2,631			45,239
Equity in Loss of Project Partnerships	4,909		87,688		100,405
Gain on Sale of Project Partnerships			(4,000	)			(23,000	)		(349	)
Gain on Sale of Project Partnerships	(10,000)		-		-
Distribution Income			(24,662	)			(23,800	)		(18,335	)
Distribution Income	(15,862)		(10,038)		(8,514)
Changes in Operating Assets and Liabilities:
Changes in Operating Assets and Liabilities:
Decrease in Interest Receivable			-				-			966
Decrease (Increase) in Interest Receivable	-		1,288		(134)
Increase in Payable to General Partners			82,627				129,865			161,182
Increase in Payable to General Partners	83,386		48,185		51,228
Net Cash (Used in) Provided by Operating Activities			(36,253	)			3,731			(97,201	)
Net Cash Used in Operating Activities	(55,055)		(102,265)		(93,246)
Cash Flows from Investing Activities:
Cash Flows from Investing Activities:
Distributions Received from Project Partnerships			24,662				26,339			22,305
Distributions Received from Project Partnerships	17,641		14,985		15,582
Net Proceeds from Sale of Project Partnerships			4,000				23,000			349
Net Proceeds from Sale of Project Partnerships	10,000		-		-
Redemption of Investment Securities			-				-			156,000
Redemption of Investment Securities	-		182,000		172,000
Purchase of Investment Securities			-				-			(80,169	)
Purchase of Investment Securities	-		(34,641)		(100,133)
Net Cash Provided by Investing Activities			28,662				49,339			98,485
Net Cash Provided by Investing Activities	27,641		162,344		87,449
Cash Flows from Financing Activities:
(Decrease) Increase in Cash and Cash Equivalents	(27,414)		60,079		(5,797)
Distributions Paid to Limited Partners			-				-			(67,964	)
Cash and Cash Equivalents at Beginning of Year	124,326		64,247		70,044
Net Cash Used in Financing Activities			-				-			(67,964	)
Cash and Cash Equivalents at End of Year	$ 96,912		$ 124,326		$ 64,247
(Decrease) Increase in Cash and Cash Equivalents			(7,591	)			53,070			(66,680	)
Supplemental disclosure of non-cash activities:
Cash and Cash Equivalents at Beginning of Year			238,988				185,918			252,598
Increase in Distribution Payable	$ 10,000		$ -		$ -
Cash and Cash Equivalents at End of Year		$	231,397			$	238,988		$	185,918
Distribution to Limited Partners	(10,000)		-		-
Supplemental disclosure of non-cash activities:
	$ -		$ -		$ -
Increase in Distribution Payable		$	4,000			$	23,000		$	-
Distribution to Limited Partners			(4,000	)			(23,000	)		-
		$	-			$	-		$	-

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 10
		SERIES 9
	2010		2009		2008
		2011				2010			2009
Cash Flows from Operating Activities:
Net Loss	~~$ (100,294)~~	$	$ (~~609~~9,~~675)~~637	)	~~$ (561,574)~~	$	(120,481	)	$	(416,956	)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Amortization	~~667~~		~~20,914~~-		~~24,106~~		2,993			10,045
Impairment Loss on Investment in Project Partnerships	-		~~506,918~~-		~~376,185~~		-			180,400
Accreted Interest Income on Investment in Securities	~~(1,896)~~		~~(4,367)~~-		~~(6,464)~~		-			(2,552	)
Discount on Investment in Securities	-		~~(495)~~-		~~(361)~~		-			(325	)
Equity in Loss (Income) of Project Partnerships	28,325		(796)		75,336
Equity in Loss of Project Partnerships			-				4,909			87,688
Gain on Sale of Project Partnerships	~~(10,000)~~		-(45,030	)	-		(10,000	)		-
Distribution Income	~~(8,658)~~		(1216,~~302)~~002	)	~~(2,129)~~		(15,862	)		(10,038	)
Changes in Operating Assets and Liabilities:
Decrease in Interest Receivable	-		~~644~~-		~~273~~		-			1,288
Increase in Payable to General Partners	~~55,625~~		3354,~~238~~921		~~34,909~~		83,386			48,185
Net Cash Used in Operating Activities	~~(36,231)~~		(6515,~~921)~~748	)	~~(59,719)~~		(55,055	)		(102,265	)
Cash Flows from Investing Activities:
Distributions Received from Project Partnerships	~~18,807~~		2116,~~421~~002		~~13,483~~		17,641			14,985
Net Proceeds from Sale of Project Partnerships	~~10,000~~		-45,030		-		10,000			-
Redemption of Investment Securities	~~40,000~~		~~136,000~~-		~~135,000~~		-			182,000
Purchase of Investment Securities	-		~~(49,487)~~-		~~(50,066)~~		-			(34,641	)
Net Cash Provided by Investing Activities	~~68,807~~		~~107~~61,~~934~~032		~~98,417~~		27,641			162,344
Increase in Cash and Cash Equivalents	32,576		42,013		38,698
Increase (Decrease) in Cash and Cash Equivalents			45,284				(27,414	)		60,079
Cash and Cash Equivalents at Beginning of Year	~~121,062~~		7996,~~049~~912		~~40,351~~		124,326			64,247
Cash and Cash Equivalents at End of Year	~~$ 153,638~~	$	~~$ 121~~142,~~062~~196		~~$ 79,049~~	$	96,912		$	124,326
Supplemental disclosure of non-cash activities:
Increase in Distribution Payable	~~$ 10,000~~	$	~~$ -~~45,030		~~$ -~~	$	10,000		$	-
Distribution to Limited Partners	~~(10,000)~~		-(45,030	)	-		(10,000	)		-
	$ -		$ -		$ -
		$	-			$	-		$	-

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	SERIES 11
		SERIES 10
	2010		2009		2008
		2011				2010			2009
Cash Flows from Operating Activities:
Net Loss	~~$ (188,280)~~	$	$ (~~468~~60,~~075)~~829	)	~~$ (628,777)~~	$	(100,294	)	$	(609,675	)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Amortization	~~12,518~~		~~28,981~~-		~~33,497~~		667			20,914
Impairment Loss on Investment in Project Partnerships	~~19,418~~		~~248,250~~-		~~454,605~~		-			506,918
Accreted Interest Income on Investment in Securities	~~(2,767)~~		~~(5,622)~~-		~~(8,114)~~		(1,896	)		(4,367	)
Discount on Investment in Securities	-		~~(1,300)~~-		~~(493)~~		-			(495	)
Equity in Loss of Project Partnerships	80,592		115,651		74,752
Equity in Loss (Income) of Project Partnerships			25,669				28,325			(796	)
Distribution Income	(4,207)		(2,182)		(2,782)
Gain on Sale of Project Partnerships			(2,000	)			(10,000	)		-
Changes in Operating Assets and Liabilities:
Distribution Income			(12,943	)			(8,658	)		(12,302	)
Decrease (Increase) in Interest Receivable	-		1,610		(229)
Changes in Operating Assets and Liabilities:
Increase in Payable to General Partners	27,586		30,012		27,962
Decrease in Interest Receivable			-				-			644
Net Cash Used in Operating Activities	(55,140)		(52,675)		(49,579)
Increase in Payable to General Partners			28,281				55,625			33,238
Cash Flows from Investing Activities:
Net Cash Used in Operating Activities			(21,822	)			(36,231	)		(65,921	)
Distributions Received from Project Partnerships	16,292		7,967		10,754
Cash Flows from Investing Activities:
Redemption of Investment Securities	44,000		298,000		192,000
Distributions Received from Project Partnerships			19,844				18,807			21,421
Purchase of Investment Securities	-		(129,655)		(125,166)
Net Proceeds from Sale of Project Partnerships			2,000				10,000			-
Net Cash Provided by Investing Activities	60,292		176,312		77,588
Redemption of Investment Securities			-				40,000			136,000
Increase in Cash and Cash Equivalents	5,152		123,637		28,009
Purchase of Investment Securities			-				-			(49,487	)
Cash and Cash Equivalents at Beginning of Year	204,816		81,179		53,170
Net Cash Provided by Investing Activities			21,844				68,807			107,934
Cash and Cash Equivalents at End of Year	$ 209,968		$ 204,816		$ 81,179
Increase in Cash and Cash Equivalents			22				32,576			42,013
Cash and Cash Equivalents at Beginning of Year			153,638				121,062			79,049
Cash and Cash Equivalents at End of Year		$	153,660			$	153,638		$	121,062
Supplemental disclosure of non-cash activities:
Increase in Distribution Payable		$	2,000			$	10,000		$	-
Distribution to Limited Partners			(2,000	)			(10,000	)		-
		$	-			$	-		$	-

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

	TOTAL SERIES 7 - 11
		SERIES 11
	2010		2009		2008
		2011				2010			2009
Cash Flows from Operating Activities:
Net Loss	~~$ (357,872)~~	$	$ (245,~~361,203)~~060	)	~~$ (2,030,373)~~	$	(188,280	)	$	(468,075	)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Amortization	~~17,625~~		~~76,027~~-		~~108,729~~		12,518			28,981
Impairment Loss on Investment in Project Partnerships	~~28,099~~		~~1,340,110~~-		~~962,003~~		19,418			248,250
Accreted Interest Income on Investment in Securities	~~(4,663)~~		~~(12,541)~~-		~~(29,767)~~		(2,767	)		(5,622	)
Discount on Investment in Securities	-		~~(4,516)~~-		~~(2,338)~~		-			(1,300	)
Equity in Loss of Project Partnerships	~~116,457~~		~~247~~107,~~075~~077		~~333,294~~		80,592			115,651
Gain on Sale of Project Partnerships	~~(343,518)~~		(43125,774)	)	~~(68,000)~~		-			-
Distribution Income	~~(83,716)~~		(693,~~273)~~607	)	~~(78,889)~~		(4,207	)		(2,182	)
Changes in Operating Assets and Liabilities:
Decrease (Increase) in Interest Receivable	-		7,085		(898)
Decrease in Interest Receivable			-				-			1,610
Decrease (Increase) in Receivable - Other	-		696		(696)
Increase in Payable to General Partners			25,368				27,586			30,012
Increase in Payable to General Partners	407,551		350,144		338,355
Net Cash Used in Operating Activities			(41,996	)			(55,140	)		(52,675	)
Net Cash Used in Operating Activities	(220,037)		(470,170)		(468,580)
Cash Flows from Investing Activities:
Cash Flows from Investing Activities:
Distributions Received from Project Partnerships			12,646				16,292			7,967
Distributions Received from Project Partnerships	114,268		101,326		116,257
Net Proceeds from Sale of Project Partnerships			175,667				-			-
Net Proceeds from Sale of Project Partnerships	343,518		43,774		68,000
Redemption of Investment Securities			-				44,000			298,000
Redemption of Investment Securities	84,000		1,134,000		997,000
Purchase of Investment Securities			-				-			(129,655	)
Purchase of Investment Securities	-		(454,289)		(550,731)
Net Cash Provided by Investing Activities			188,313				60,292			176,312
Net Cash Provided by Investing Activities	541,786		824,811		630,526
Increase in Cash and Cash Equivalents			146,317				5,152			123,637
Cash Flows from Financing Activities:
Cash and Cash Equivalents at Beginning of Year			209,968				204,816			81,179
Distributions Paid to Limited Partners	(295,530)		(111,311)		-
Cash and Cash Equivalents at End of Year		$	356,285			$	209,968		$	204,816
Net Cash Used in Financing Activities	(295,530)		(111,311)		-
Supplemental disclosure of non-cash activities:
Increase in Cash and Cash Equivalents	26,219		243,330		161,946
Increase in Distribution Payable		$	125,774			$	-		$	-
Cash and Cash Equivalents at Beginning of Year	882,989		639,659		477,713
Distribution to Limited Partners			(125,774	)			-			-
Cash and Cash Equivalents at End of Year	$ 909,208		$ 882,989		$ 639,659
		$	-			$	-		$	-
Supplemental disclosure of non-cash activities:
Increase in Distribution Payable	$ 43,000		$ -		$ 68,000
Distribution to Limited Partners	(43,000)		-		(68,000)
	$ -		$ -		$ -

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED MARCH 31, 2011, 2010 AND 2009

	TOTAL SERIES 7 - 11
	2011			2010			2009
Cash Flows from Operating Activities:
Net Income (Loss)	$	267,695		$	(357,872	)	$	(2,361,203	)
Adjustments to Reconcile Net Income (Loss) to Net Cash Used in Operating Activities:
Amortization		146			17,625			76,027
Impairment Loss on Investment in Project Partnerships		-			28,099			1,340,110
Accreted Interest Income on Investment in Securities		-			(4,663	)		(12,541	)
Discount on Investment in Securities		-			-			(4,516	)
Equity in Loss of Project Partnerships		132,746			116,457			247,075
Gain on Sale of Project Partnerships		(717,489	)		(343,518	)		(43,774	)
Distribution Income		(80,687	)		(83,716	)		(69,273	)
Changes in Operating Assets and Liabilities:
Decrease in Interest Receivable		-			-			7,085
Decrease in Receivable - Other		-			-			696
Increase in Payable to General Partners		194,336			407,551			350,144
Net Cash Used in Operating Activities		(203,253	)		(220,037	)		(470,170	)

Cash Flows from Investing Activities:
Distributions Received from Project Partnerships		95,789			114,268			101,326
Net Proceeds from Sale of Project Partnerships		852,091			343,518			43,774
Redemption of Investment Securities		-			84,000			1,134,000
Purchase of Investment Securities		-			-			(454,289	)
Net Cash Provided by Investing Activities		947,880			541,786			824,811

Cash Flows from Financing Activities:
Distributions Paid to Limited Partners		-			(295,530	)		(111,311	)
Net Cash Used in Financing Activities		-			(295,530	)		(111,311	)

Increase in Cash and Cash Equivalents		744,627			26,219			243,330
Cash and Cash Equivalents at Beginning of Year		909,208			882,989			639,659

Cash and Cash Equivalents at End of Year	$	1,653,835		$	909,208		$	882,989

Supplemental disclosure of non-cash activities:
Increase in Distribution Payable	$	717,489		$	43,000		$	-
Distribution to Limited Partners		(717,489	)		(43,000	)		-
	$	-		$	-		$	-

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND III LTD.

(A Florida Limited Partnership)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, ~~2010~~2011, ~~2009~~2010 AND ~~2008~~2009

NOTE 1 - ORGANIZATION:

Gateway Tax Credit Fund III Ltd. (“Gateway”), a Florida Limited Partnership, was formed October 17, 1991 under the laws of Florida. Gateway offered its limited partnership interests in Series (“Series”). The first Series for Gateway is Series 7. Operations commenced on July 16, 1992 for Series 7, January 4, 1993 for Series 8, September 30, 1993 for Series 9, January 21, 1994 for Series 10 and April 29, 1994 for Series 11. Each Series invests, as a limited partner, in other limited partnerships (“Project Partnerships”), each of which owns and operates apartment complexes eligible for Low-Income Housing Tax Credits (“Tax Credits”), provided for in Section 42 of the Internal Revenue Code of 1986. Gateway will terminate on December 31, 2040 or sooner, in accordance with the terms of the limited partnership agreement (the “Agreement”). As of March 31, ~~2010~~2011, Gateway had received capital contributions of $1,000 from the General Partners and $36,799,000 from the investor Limited Partners.

Raymond James Partners, Inc. and Raymond James Tax Credit Funds, Inc., wholly owned subsidiaries of Raymond James Financial, Inc., are the General Partner and Managing General Partner, respectively and collectively the General Partners.

Gateway received capital contributions of $10,395,000, $9,980,000, $6,254,000, $5,043,000 and $5,127,000 from the investor Limited Partners in Series 7, 8, 9, 10 and 11, respectively. Each Series will be treated as though it were a separate partnership, investing in a separate and distinct pool of Project Partnerships. Income or loss and all tax items from the Project Partnerships acquired by each Series are specifically allocated among the Limited Partners of such Series.

Operating profits and losses, cash distributions from operations and Tax Credits from each Series are generally allocated 99% to the Limited Partners in that Series and 1% to the General Partners. Profit or loss and cash distributions from sales of properties by each Series are allocated as specified in the Agreement.

The IRS compliance period for low-income housing Tax Credit properties is generally 15 years from occupancy following construction or rehabilitation completion.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:

Basis of Accounting

Gateway utilizes the accrual basis of accounting whereby revenues are recognized as earned and expenses are recognized as obligations are incurred.

Gateway accounts for its investments as the limited partner in Project Partnerships (“Investments in Project Partnerships”) using the equity method of accounting, because management believes that Gateway does not have a majority control of the major operating and financial policies of the Project Partnerships in which it invests, and reports the equity in loss of the Project Partnerships on a 3-month lag in the Statements of Operations. Under the equity method, the Investments in Project Partnerships initially include:

1)	Gateway's capital contribution,

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

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

Quarterly the Investments in Project Partnerships are increased or decreased as follows:

1)	Increased for equity in income or decreased for equity in loss of the Project Partnerships,

2)	Decreased for cash distributions received from the Project Partnerships,

3)	Decreased for the amortization of the acquisition fees and expenses,

4)	Increased for loans or advances made to the Project Partnerships by Gateway,

5)	Decreased, where appropriate, for impairment.

Pursuant to the limited partnership agreements for the Project Partnerships, cash losses generated by the Project Partnerships are allocated to the general partners of those partnerships. In subsequent years, cash profits, if any, are first allocated to the general partners to the extent of the allocation of prior cash losses.

3840

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Continued):

Since Gateway invests as a limited partner, and therefore is not obligated to fund losses or make additional capital contributions, it does not recognize losses from individual Project Partnerships to the extent that these losses would reduce the investment in those Project Partnerships below zero. In accordance with generally accepted accounting principles (“GAAP”), once the net investment in a Project Partnership is reduced to zero, receivables due from the Project Partnership are decreased by Gateway’s share of Project Partnership losses. The suspended losses will be used to offset future income from the individual Project Partnerships. Any cash distributions received from Project Partnerships which have a zero investment balance are accounted for as distribution income in the period the cash distribution is received by Gateway.

Gateway reviews its investments in Project Partnerships to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. If the sum of the expected remaining low-income housing tax credits and other tax benefits is less than the carrying amount of the investment, Gateway recognizes an impairment loss. Gateway has historically considered the residual value of the Project Partnerships as one key component of its analysis. ~~During~~No ~~the~~impairment ~~quarter~~expense ~~ended~~was ~~December~~recognized ~~31,~~for ~~2008, as a direct result of~~ the ~~deterioration~~year ~~that~~ended ~~occurred~~March ~~within the United States financial markets and more specifically~~31, ~~its negative impact on the Tax Credit market, Gateway concluded that any residual value of the Project Partnerships given the Tax Credit market conditions could not be practicably determined~~2011. ~~As a result, Gateway eliminated estimates of residual value of the Project Partnerships from the recoverability portion of its impairment analysis.~~ Impairment expense for the year ended March 31, 2010 totaled $28,099, comprised of $8,681 in Series 8 and $19,418 in Series 11. Impairment expense for the year ended March 31, 2009 totaled $1,340,110, comprised of $183,299 in Series 7, $221,243 in Series 8, $180,400 in Series 9, $506,918 in Series 10, and $248,250 in Series 11. ~~Impairment expense for the year ended March 31, 2008 totaled $962,003, comprised of $99,867 in Series 7, $31,346 in Series 8, $376,185 in Series 10, and $454,605 in Series 11.~~ Refer to Note 54 –- Investments in Project Partnerships for further details regarding the components of the Investments in Project Partnerships balance. Gateway is continuing to execute its process of disposition of its interest in Project Partnerships that have reached the end of their Tax Credit compliance period, refer to Note 65 –- Summary of Disposition Activities for the most recent update of those on-going activities.

Gateway, as a limited partner in the Project Partnerships, is subject to risks inherent in the ownership of property which are beyond its control, such as fluctuations in occupancy rates and operating expenses, variations in rental schedules, proper maintenance and continued eligibility for Tax Credits. If the cost of operating a property exceeds the rental income earned thereon, Gateway may deem it in its best interest to voluntarily provide funds in order to protect its investment. However, Gateway does not guarantee any of the mortgages or other debt of the Project Partnerships. No such funding to Project Partnerships occurred during fiscal years ~~2010~~2011, ~~2009~~2010, or ~~2008~~2009.

Cash and Cash Equivalents

Gateway's policy is to include short-term investments with an original maturity of three months or less in Cash and Cash Equivalents. Short-term investments are comprised of money market mutual funds.

Concentrations of Credit Risk

Financial instruments which potentially subject Gateway to concentrations of credit risk consist of cash investments in a money market mutual fund ~~whose investment advisor is a wholly owned subsidiary of Raymond James Financial, Inc~~. ~~In July 2010, an unaffiliated third party will replace the current investment advisor.~~

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires the use of estimates that affect certain reported amounts and disclosures. These estimates are based on management's knowledge and experience. Accordingly, actual results could differ from these estimates.

3941

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Continued):

Investment in Securities

Gateway is required under GAAP to categorize its investments in debt securities as held-to-maturity, available-for-sale or trading securities, dependent upon Gateway's intent in holding the securities. Gateway's intent is to hold all of its debt securities (U.S. Treasury Security Strips) until maturity and to use these investments to fund Gateway's ongoing operations. Interest income is recognized ratably on the U.S. Treasury Security Strips using the effective yield to maturity. The U.S. Treasury Security Strips are carried at amortized cost, which approximates market value, and are adjusted for amortization of premiums and accretion of discounts to maturity. Such adjustments are included in interest income. There are no ~~investments~~Investments in ~~securities~~Securities as of March 31, 2011 and 2010.

Income Taxes

No provision for income taxes has been made in these financial statements, as income taxes are a liability of the partners rather than of Gateway. Gateway files income tax returns in the U.S. federal jurisdiction and various state jurisdictions. Gateway is no longer subject to U.S. federal examination by tax authorities for years prior to calendar year ~~2007~~2008. The income tax returns subject to state examination by tax authorities are generally consistent with the federal period.

Distribution Payable

Distribution payable consists of amounts received as net sales proceeds. These amounts, net of the applicable state tax withholding, are due and payable to the Assignees and will be distributed at such time that state tax withholding liabilities have been settled.

State Tax Withholding

Certain state tax jurisdictions impose a capital gains tax on the taxable gains associated with the sale of investments in partnerships. As General Partner of Gateway, it is Gateway’s obligation to calculate and withhold the applicable state taxes that are payable by the Partners of Gateway when Project Partnerships are sold or otherwise disposed by Gateway. In most cases, the state taxes are due regardless if proceeds are received from the sale of Project Partnerships. Therefore, Gateway has estimated the withholding taxes payable and the amount is included in Distribution Payable on the Balance Sheet.

Variable Interest Entities

~~Generally,~~In aJune ~~variable interest entity~~2009, ~~or VIE, is an entity with one or more of~~ the ~~following~~FASB ~~characteristics,~~issued ~~(a)~~new ~~the~~consolidation ~~total~~guidance ~~equity~~applicable ~~investment at risk is not sufficient~~ to ~~permit~~variable ~~the~~interest entity to finance its activities without additional subordinated financial support; (b) as a group the holders of the equity investment at risk lack (i) the ability to make decisions about an entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rightsentities. ~~GAAP requires a VIE to be consolidated in the financial statements of the entity that is determined to be the primary beneficiary of the VIE.~~ Gateway’s ~~determination~~adopted ofthis ~~the~~new ~~primary~~guidance ~~beneficiary~~as of ~~each~~April ~~VIE requires judgment and is based on an analysis of all relevant facts and circumstances including: (~~1~~) the existence of a principal-agency relationship between the limited partner and the general partner~~, ~~(2) the relationship and significance of the activities of the VIE to each partner, (3) each partner’s exposure to the expected losses of the VIE, and (4) the design of the VIE~~2010. InThe ~~the~~adoption ~~design~~ of ~~Project~~this ~~Partnership~~new ~~VIEs,~~guidance ~~the~~had ~~overriding~~no ~~concept~~impact ~~centers~~on around the premise that the limited partner invests solely for tax attributes associated with the property held by the VIE, while the general partner of the project partnership is responsible for overseeing its operations. Based upon its analysis of all the relevant facts and considerations, Gateway’s ~~has~~financial concluded that in those instances where the Project Partnership interests are determined to be VIEs, the general partner of the Project Partnership is more closely associated with the Project Partnership than the limited partner (Gateway) and therefore, Gateway is not the primary beneficiarystatements.

~~Gateway~~Generally, ~~holds~~a variable ~~interests~~interest inentity, ~~114~~or ~~VIEs~~VIE, ~~which~~is ~~consist~~an entity with one or more of ~~Project~~the ~~Partnerships~~following characteristics, of(a) ~~which~~the ~~Gateway~~total equity investment at risk is not sufficient to permit the ~~primary~~entity ~~beneficiary. Five~~to finance its activities without additional subordinated financial support; (b) as a group the holders of ~~Gateway’s~~the ~~Project~~equity ~~Partnership~~investment ~~investments~~at ~~have~~risk ~~been~~lack ~~determined~~(i) ~~not~~the power to bedirect ~~VIEs. Since~~the activities of the entity that most significantly affect its ~~inception~~economic performance, ~~Gateway’s~~(ii) ~~maximum~~the ~~exposure~~obligation to ~~loss~~absorb asthe aexpected ~~result~~losses or the right to receive the expected benefits of ~~its~~the ~~involvement~~entity; ~~with~~or ~~unconsolidated~~(c) ~~VIEs~~the ~~has~~equity ~~been~~investors ~~limited~~have tovoting ~~Gateway’s~~rights ~~capital~~that ~~contributions~~are not proportional to their economic interests and ~~receivables~~substantially ~~from~~all ~~those~~of ~~VIEs,~~the ~~which~~entity’s isactivities ~~approximately~~either ~~$23~~involve,~~139,942~~ ator ~~March~~are 31conducted on behalf of, ~~2010~~an investor that has disproportionately few voting rights. ~~Over~~ ~~the~~GAAP ~~course~~requires ofa VIE to be consolidated in the ~~investment~~financial ~~and~~statements ~~Tax~~of ~~Credit~~the ~~cycle,~~entity ~~this~~that ~~maximum~~is ~~exposure~~determined to ~~loss~~be ~~was~~the ~~offset~~primary bybeneficiary ~~actual~~of ~~losses~~the ~~experienced~~VIE. Determination byof the ~~Project~~primary ~~Partnerships~~beneficiary ~~recorded~~of byeach ~~Gateway~~VIE inrequires ~~its~~judgment ~~equity~~and ~~accounting. Accordingly,~~is atbased ~~the~~on ~~current~~an ~~stage~~analysis of control of the ~~investment~~entity and ~~Tax~~economic ~~Credit~~factors. A ~~cycle,~~VIE would be required to be consolidated if it has (1) the ~~carrying~~power ~~value~~to direct the activities of ~~Gateway~~the VIE that most significantly impact the VIE’s ~~interest~~economic inperformance and (2) the ~~VIEs~~obligation ~~has~~to ~~been~~absorb ~~reduced~~losses or receive benefits that could possibly be significant to ~~zero~~the VIE. AsIn ~~Gateway~~the asdesign noof ~~further~~Project ~~capital~~Partnership ~~funding~~VIEs, ~~requirements~~the ~~nor~~overriding ~~does~~concept itcenters ~~guarantee~~around the ~~debt~~premise that the limited partner invests solely for tax attributes associated with the property held by the VIE, while the general partner of the Project ~~Partnerships,~~Partnership is responsible for overseeing its ~~further~~operations. Based ~~exposure~~upon toits ~~loss~~analysis isof ~~limited~~all the relevant facts and considerations, Gateway has concluded that the general partner of the Project Partnership has the power to direct the ~~extent~~activities of ~~any~~the ~~financial~~Project ~~support~~Partnership that ~~Gateway~~most ~~voluntarily~~significantly ~~provides~~impact its economic performance, and the obligation to ~~those~~absorb ~~Project~~losses ~~Partnerships~~or inreceive benefits that could be significant to the ~~future. Gateway~~Project ~~does~~Partnership ~~not~~and ~~currently~~therefore, ~~intend~~Gateway tois ~~provide~~not ~~such~~the ~~support~~primary beneficiary.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Continued):

Gateway holds variable interests in 112 VIEs, which consist of Project Partnerships (Refer to Note 1 – Organization for information about Gateway’s involvement in the Project Partnerships). Gateway is not the primary beneficiary of the VIEs. Since its inception, Gateway’s maximum exposure to loss as a result of its involvement with unconsolidated VIEs is limited to Gateway’s capital contributions to those VIEs, which is approximately $23,761,826 at March 31, 2011. Over the course of the investment and Tax Credit Cycle, this maximum exposure to loss was offset by actual losses experienced by the Project Partnerships recorded by Gateway in its equity accounting. Accordingly, at the current stage of the investment and Tax Credit Cycle, the carrying value of Gateway’s interest in the VIEs has been reduced to $310,560. Tabular disclosures within Note 4 – Investments in Project Partnerships detail total capital contributions to VIEs, the carrying amount of assets and liabilities related to Gateway’s VIEs and the aggregate assets, liabilities and Gateway’s exposure to loss from those VIEs. Gateway may be subject to additional losses to the extent of any financial support that Gateway voluntarily provides to those Project Partnerships in the future. Gateway does not currently intend to provide future financial support to the Project Partnerships.

Recent Accounting Changes

40NOTE 3 - RELATED PARTY TRANSACTIONS:

NOTE 3 - INVESTMENT IN SECURITIES:

The March 31, 2009 Balance Sheet includes U.S. Treasury Security Strips at cost, plus accreted interest income of $25,183 for Series 10 and $27,864 for Series 11. The U.S. Treasury Security Strips were commonly held in a brokerage account maintained at Raymond James and Associates, Inc., an affiliate of the General Partners. A separate accounting is maintained for each Series’ share of any investments.

	Series 10		Series 11
	March 31, 2010	March 31, 2009	March 31, 2010	March 31, 2009
Amortized Cost	$ -	$ 38,104	$ -	$ 41,233
Gross Unrealized Gain	-	1,730	-	2,584
Fair Value	$ -	$ 39,834	$ -	$ 43,817

	Total Series 7 - 11
	March 31, 2010	March 31, 2009
Amortized Cost	$ -	$ 79,337
Gross Unrealized Gain	-	4,314
Fair Value	$ -	$ 83,651

NOTE 4 - RELATED PARTY TRANSACTIONS:

The Payable to General Partners primarily represents the asset management fees and general and administrative expenses owed to the General Partners at the end of the period. It is unsecured, due on demand and, in accordance with the Agreement, non-interest bearing. Within the next 12 months, the Managing General Partner does not intend to demand payment on the portion of Asset Management Fees payable classified as long-term on the Balance Sheet.

Value Partners, Inc., an affiliate of Gateway, acquired the general partner interest in Logan Heights, one of the Project Partnerships in Series 8, in 2003 (see further discussion in Note 54).

For the years ended March 31, ~~2010~~2011, ~~2009~~2010 and ~~2008~~2009 the General Partners and affiliates are entitled to compensation and reimbursement for costs and expenses incurred by Gateway as follows:

Asset Management Fee - The Managing General Partner is entitled to receive an annual asset management fee equal to the greater of (i) $2,000 for each limited partnership in which Gateway invests, or (ii) 0.275% of Gateway's gross proceeds from the sale of limited partnership interests. In either event (i) or (ii), the maximum amount may not exceed 0.2% of the aggregate cost (Gateway's capital contribution plus Gateway's share of the Properties' mortgage) of Gateway's interest in properties owned by the Project Partnerships. The asset management fee will be paid only after all other expenses of Gateway have been paid. These fees are included in the Statements of Operations.

	2010	2009	2008
Series 7	$ 67,188	$ 80,024	$ 85,596
Series 8	85,780	86,288	89,020
Series 9	48,589	48,840	49,068
Series 10	33,424	33,584	33,536
Series 11	28,124	28,352	28,699
Total	$ 263,105	$ 277,088	$ 285,919

NOTE 4 - RELATED PARTY TRANSACTIONS (Continued):

General and Administrative Expenses - The Managing General Partner is reimbursed for general and administrative expenses of Gateway on an accountable basis. This expense is included in the Statements of Operations.

	2010	2009	2008
Series 7	$ 82,933	$ 114,225	$ 124,429
Series 8	-	130,191	136,878
Series 9	62,259	74,395	76,571
Series 10	38,620	46,497	47,857
Series 11	34,766	37,198	38,286
Total	$ 218,578	$ 402,506	$ 424,021

Total unpaid asset management fees and administrative expenses payable to the General Partners, which are included on the Balance Sheet as of March 31, 2010 and 2009 are as follows:

	March 31, 2010	March 31, 2009
Series 7	$ 1,068,624	$ 957,535
Series 8	1,250,729	1,120,864
Series 9	690,601	607,215
Series 10	234,286	178,661
Series 11	119,675	92,089
Total	$ 3,363,915	$ 2,956,364

NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS:

As of March 31, 2010, Gateway had acquired a 99% interest in the profits, losses, and Tax Credits as a limited partner in Project Partnerships (Series 7 - 30, Series 8 - 40, and Series 9 - 23) which own and operate government assisted multi-family housing complexes. Cash flows from operations are allocated according to each Project Partnership agreement. Upon dissolution, proceeds will be distributed according to each Project Partnership agreement. The following is a summary of Investments in Project Partnerships as of:

	SERIES 7		SERIES 8		SERIES 9
	March 31,	March 31,	March 31,	March 31,	March 31,	March 31,
	2010	2009	2010	2009	2010	2009
Capital Contributions to Project Partnerships
and purchase price paid for limited partner
interests in Project Partnerships	$ 5,721,083	$ 6,861,114	$ 6,941,449	$ 7,400,711	$ 4,703,741	$ 4,914,116
Loan receivable from Project Partnerships	-	-	24,220	24,220	-	-
Cumulative equity in losses of Project
Partnerships (1) (2)	(5,194,990)	(6,402,875)	(6,877,633)	(7,340,840)	(4,353,387)	(4,566,084)
Cumulative distributions received from
Project Partnerships	(216,294)	(252,589)	(179,115)	(187,825)	(167,764)	(168,985)
Investment in Project Partnerships before
Adjustment	309,799	205,650	(91,079)	(103,734)	182,590	179,047
Excess of investment cost over the underlying
assets acquired:
Acquisition fees and expenses	573,481	703,733	513,903	536,715	231,156	244,087
Accumulated amortization of acquisition
fees and expenses	(246,706)	(268,518)	(161,554)	(165,385)	(105,814)	(105,521)
Reserve for Impairment of Investment in
Project Partnerships	(552,557)	(552,557)	(261,270)	(252,589)	(307,932)	(307,932)
Investments in Project Partnerships	$ 84,017	$ 88,308	$ -	$ 15,007	$ -	$ 9,681

(1) In accordance with Gateway's accounting policy to not carry Investments in Project Partnerships below zero, cumulative suspended losses of $5,438,071 in Series 7, $8,066,825 in Series 8, and $3,237,997 in Series 9 for the year ended March 31, 2010; and cumulative suspended losses of $5,704,356 in Series 7, $7,564,293 in Series 8, and $2,844,368 in Series 9 for the year ended March 31, 2009 are not included. (2) In accordance with Gateway's accounting policy to apply equity in losses of Project Partnerships to receivables from Project Partnerships, $24,220 in losses are included in Series 8 as of March 31, 2010 and March 31, 2009. (See discussion in Note 2 - Significant Accounting Policies.)

NOTE 53 - ~~INVESTMENTS~~RELATED INPARTY ~~PROJECT~~TRANSACTIONS ~~PARTNERSHIPS~~ (Continued):

AsAsset ofManagement ~~March~~Fee ~~31,~~- ~~2010,~~The ~~Gateway~~Managing ~~had~~General ~~acquired~~Partner ais ~~99%~~entitled ~~interest~~to inreceive ~~the~~an ~~profits,~~annual ~~losses,~~asset ~~and~~management ~~Tax~~fee ~~Credits~~equal asto athe greater of (i) $2,000 for each limited ~~partner~~partnership in ~~Project~~which ~~Partnerships~~Gateway invests, or (~~Series~~ii) 100.275% -of 14Gateway's ~~and~~gross ~~Series~~proceeds 11from -the 12sale of limited partnership interests. In either event (i) ~~which~~or ~~own~~(ii), ~~and~~the ~~operate~~maximum ~~government~~amount ~~assisted~~may ~~multi-family~~not ~~housing~~exceed ~~complexes~~0.2% ~~Cash~~of ~~flows~~the ~~from~~aggregate ~~operations~~cost ~~are~~(Gateway's ~~allocated~~capital ~~according~~contribution toplus ~~each~~Gateway's ~~Project~~share ~~Partnership~~of ~~agreement~~the Properties' mortgage) of Gateway's interest in properties owned by the Project Partnerships. The ~~Upon~~asset ~~dissolution,~~management ~~proceeds~~fee will be ~~distributed~~paid ~~according~~only toafter ~~each~~all ~~Project~~other ~~Partnership~~expenses ~~agreement.~~of ~~The~~Gateway ~~following~~have isbeen apaid. These ~~summary~~fees ofare ~~Investments~~included in ~~Project~~the ~~Partnerships~~Statements as of: Operations.

	SERIES 10			SERIES 11			TOTAL SERIES 7 - 11
		2011			2010			2009
	March 31,		March 31,	March 31,		March 31,	March 31,		March 31,
Series 7		$	57,429		$	67,188		$	80,024
	2010		2009	2010		2009	2010		2009
Series 8			80,466			85,780			86,288
Capital Contributions to Project Partnerships
Series 9			45,797			48,589			48,840
and purchase price paid for limited partner
Series 10			31,251			33,424			33,584
interests in Project Partnerships	$ 3,716,106		$ 3,914,672	$ 4,128,042		$ 4,128,042	$ 25,210,421		$ 27,218,655
Series 11			27,711			28,124			28,352
Loan receivable from Project Partnerships	-		-	-		-	24,220		24,220
Total		$	242,654		$	263,105		$	277,088
Cumulative equity in losses of Project
Partnerships (1)	(2,325,162)		(2,506,807)	(1,908,139)		(1,827,547)	(20,659,311)		(22,644,153)
Cumulative distributions received from
Project Partnerships	(234,740)		(229,841)	(206,979)		(194,894)	(1,004,892)		(1,034,134)
Investment in Project Partnerships before
Adjustment	1,156,204		1,178,024	2,012,924		2,105,601	3,570,438		3,564,588
Excess of investment cost over the underlying
assets acquired:
Acquisition fees and expenses	174,878		196,738	290,335		290,335	1,783,753		1,971,608
Accumulated amortization of acquisition
fees and expenses	(147,889)		(152,428)	(222,991)		(210,473)	(884,954)		(902,325)
Reserve for Impairment of Investment in
Project Partnerships	(1,085,926)		(1,085,926)	(1,668,396)		(1,648,978)	(3,876,081)		(3,847,982)
Investments in Project Partnerships	$ 97,267		$ 136,408	$ 411,872		$ 536,485	$ 593,156		$ 785,889

~~(1)~~General Inand ~~accordance~~Administrative ~~with~~Expenses ~~Gateway's~~- ~~accounting~~The ~~policy~~Managing toGeneral ~~not~~Partner ~~carry~~is ~~Investments~~reimbursed infor ~~Project~~general ~~Partnerships~~and ~~below~~administrative ~~zero,~~expenses ~~cumulative~~of ~~suspended~~Gateway ~~losses~~on ofan ~~$719,103~~accountable inbasis. This ~~Series~~expense 10is ~~and~~included ~~$1,392,126~~ in ~~Series 11 for~~ the ~~year~~Statements ~~ended March 31, 2010; and cumulative suspended losses~~ of ~~$660,430~~Operations. During infiscal ~~Series~~year ~~10 and $1~~2011,~~231,664~~ inthe ~~Series~~General 11Partner ~~for~~ceased ~~the~~further ~~year~~allocations ~~ended~~of ~~March~~general ~~31,~~and ~~2009~~administrative ~~are~~expenses ~~not~~to ~~included~~Gateway.

	2011		2010		2009
Series 7	$	-	$	82,933	$	114,225
Series 8		-		-		130,191
Series 9		-		62,259		74,395
Series 10		-		38,620		46,497
Series 11		20,774		34,766		37,198
Total	$	20,774	$	218,578	$	402,506

Total unpaid asset management fees and administrative expenses payable to the General Partners, which are included on the Balance Sheet as of March 31, 2011 and 2010 are as follows:

	March 31, 2011		March 31, 2010
Series 7	$	1,071,763	$	1,068,624
Series 8		1,333,356		1,250,729
Series 9		745,522		690,601
Series 10		262,567		234,286
Series 11		145,043		119,675
Total	$	3,558,251	$	3,363,915

NOTE 54 - INVESTMENTS IN PROJECT PARTNERSHIPS ~~(Continued)~~:

InAs ~~accordance~~of ~~with~~March ~~Gateway’s~~31, ~~policy~~2011, ofGateway ~~presenting~~had ~~the~~acquired ~~financial~~a ~~information~~99% ofinterest in the ~~Project~~profits, ~~Partnerships~~losses, onand Tax Credits as a ~~three~~limited ~~month~~partner ~~lag,~~in ~~below~~Project isPartnerships ~~the~~(Series ~~summarized~~7 ~~balance~~- ~~sheets~~25, ~~for~~Series ~~the~~8 ~~Project~~- ~~Partnerships~~40, ofand Series 79 as- of22) ~~December~~which 31own and ~~the~~operate ~~summarized~~government ~~statements~~assisted ofmulti-family housing complexes. Cash flows from operations ~~for~~are ~~the~~allocated ~~year~~according ~~ended~~to ~~December~~each 31Project ofPartnership agreement. Upon dissolution, proceeds will be distributed according to each ~~year~~Project Partnership agreement. The following is a summary of Investments in Project Partnerships as of:

	~~SERIES 7~~	SERIES 7							SERIES 8						SERIES 9
	2009		2008		2007
		March 31,				March 31,			March 31,			March 31,			March 31,			March 31,
SUMMARIZED BALANCE SHEETS
		2011				2010			2011			2010			2011			2010
Assets:
Capital Contributions to Project Partnerships
Current assets	$ 3,440,082		$ 4,760,067		$ 4,701,831
and purchase price paid for limited partner
Investment properties, net	16,183,940		20,471,291		24,795,254
interests in Project Partnerships		$	4,648,444			$	5,721,083		$	6,965,669		$	6,941,449		$	4,599,313		$	4,703,741
Other assets	38,062		34,399		38,318
Loan receivable from Project Partnerships			-				-			-			24,220			-			-
Total assets	$ 19,662,084		$ 25,265,757		$ 29,535,403
Cumulative equity in losses of Project
Liabilities and Partners' Deficit:
Partnerships (1) (2)			(4,533,144	)			(5,194,990	)		(6,877,633	)		(6,877,633	)		(4,242,472	)		(4,353,387	)
Current liabilities	$ 786,978		$ 935,908		$ 1,071,844
Cumulative distributions received from
Long-term debt	24,463,674		30,468,234		34,955,515
Project Partnerships			(177,214	)			(216,294	)		(179,115	)		(179,115	)		(164,111	)		(167,764	)
Total liabilities	25,250,652		31,404,142		36,027,359
Investment in Project Partnerships before
Partners' deficit
Adjustment			(61,914	)			309,799			(91,079	)		(91,079	)		192,730			182,590
Limited Partner	(5,270,577)		(5,737,510)		(6,059,892)
Excess of investment cost over the underlying
General Partners	(317,991)		(400,875)		(432,064)
assets acquired:
Total partners' deficit	(5,588,568)		(6,138,385)		(6,491,956)
Acquisition fees and expenses			496,983				573,481			513,903			513,903			218,681			231,156
Total liabilities and partners' deficit	$ 19,662,084		$ 25,265,757		$ 29,535,403
Accumulated amortization of acquisition
SUMMARIZED STATEMENTS OF OPERATIONS
fees and expenses			(229,600	)			(246,706	)		(161,554	)		(161,554	)		(103,479	)		(105,814	)
Rental and other income	$ 5,284,523		$ 6,397,144		$ 7,209,575
Reserve for Impairment of Investment in
Expenses:
Project Partnerships			(205,469	)			(552,557	)		(261,270	)		(261,270	)		(307,932	)		(307,932	)
Operating expenses	3,172,014		3,478,583		3,742,728
Investments in Project Partnerships		$	-			$	84,017		$	-		$	-		$	-		$	-
Interest expense	1,799,295		2,239,047		2,540,271
Depreciation and amortization	1,008,239		1,277,049		1,495,597
Total expenses	5,979,548		6,994,679		7,778,596
Net loss	$ (695,025)		$ (597,535)		$ (569,021)
Other partners' share of net income	$ 6,076		$ 20,242		$ 23,510
Gateway's share of net loss	$ (701,101)		$ (617,777)		$ (592,531)
Suspended losses	701,101		618,484		563,742
Equity in Income (Loss) of Project Partnerships	$ -		$ 707		$ (28,789)

(1) In accordance with Gateway's accounting policy to not carry Investments in Project Partnerships below zero, cumulative suspended losses of $5,196,366 in Series 7, $8,784,792 in Series 8, and $3,506,137 in Series 9 for the year ended March 31, 2011; and cumulative suspended losses of $5,438,071 in Series 7, $8,066,825 in Series 8, and $3,237,997 in Series 9 for the year ended March 31, 2010 are not included.

(2) In accordance with Gateway's accounting policy to apply equity in losses of Project Partnerships to receivables from Project Partnerships, $24,220 in losses are included in Series 8 as of March 31, 2010. (See discussion in Note 2 - Significant Accounting Policies.)

NOTE 54 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

InAs ~~accordance~~of ~~with~~March 31, 2011, Gateway’s ~~policy~~had ofacquired ~~presenting~~a 99% interest in the ~~financial~~profits, ~~information~~losses, ofand ~~the~~Tax Credits as a limited partner in Project Partnerships on(Series a10 ~~three~~- ~~month~~14 ~~lag,~~and ~~below~~Series is11 ~~the~~- ~~summarized~~11) ~~balance~~which ~~sheets~~own ~~for~~and ~~the~~operate ~~Project~~government ~~Partnerships~~assisted ofmulti-family ~~Series~~housing 8complexes. asCash offlows ~~December~~from 31operations ~~and~~are ~~the~~allocated ~~summarized~~according ~~statements~~to ofeach ~~operations~~Project ~~for~~Partnership ~~the~~agreement. ~~year~~Upon ~~ended~~dissolution, ~~December~~proceeds 31will ofbe distributed according to each ~~year~~Project Partnership agreement. The following is a summary of Investments in Project Partnerships as of:

	SERIES 8 (1)
		SERIES 10							SERIES 11						TOTAL SERIES 7 - 11
	2009		2008		2007
		March 31,				March 31,			March 31,			March 31,			March 31,			March 31,
SUMMARIZED BALANCE SHEETS
		2011				2010			2011			2010			2011			2010
Assets:
Capital Contributions to Project Partnerships
Current assets	$ 4,271,715		$ 4,572,520		$ 4,634,557
and purchase price paid for limited partner
Investment properties, net	21,382,534		23,847,600		25,044,850
interests in Project Partnerships		$	3,716,106			$	3,716,106		$	3,832,294		$	4,128,042		$	23,761,826		$	25,210,421
Other assets	341,101		252,930		266,834
Loan receivable from Project Partnerships			-				-			-			-			-			24,220
Total assets	$ 25,995,350		$ 28,673,050		$ 29,946,241
Cumulative equity in losses of Project
Liabilities and Partners' Deficit:
Partnerships (1)			(2,350,831	)			(2,325,162	)		(2,013,680	)		(1,908,139	)		(20,017,761	)		(20,659,311	)
Current liabilities	$ 1,527,103		$ 1,553,737		$ 1,562,014
Cumulative distributions received from
Long-term debt	33,354,386		35,579,018		35,854,400
Project Partnerships			(241,641	)			(234,740	)		(203,283	)		(206,979	)		(965,363	)		(1,004,892	)
Total liabilities	34,881,489		37,132,755		37,416,414
Investment in Project Partnerships before
Partners' deficit
Adjustment			1,123,634				1,156,204			1,615,331			2,012,924			2,778,702			3,570,438
Limited Partner	(8,199,433)		(7,701,622)		(6,781,537)
Excess of investment cost over the underlying
General Partners	(686,706)		(758,083)		(688,636)
assets acquired:
Total partners' deficit	(8,886,139)		(8,459,705)		(7,470,173)
Acquisition fees and expenses			174,878				174,878			267,568			290,335			1,672,013			1,783,753
Total liabilities and partners' deficit	$ 25,995,350		$ 28,673,050		$ 29,946,241
Accumulated amortization of acquisition
SUMMARIZED STATEMENTS OF OPERATIONS
fees and expenses			(147,889	)			(147,889	)		(200,224	)		(222,991	)		(842,746	)		(884,954	)
Rental and other income	$ 6,930,389		$ 7,026,802		$ 6,962,343
Reserve for Impairment of Investment in
Expenses:
Project Partnerships			(1,085,926	)			(1,085,926	)		(1,436,812	)		(1,668,396	)		(3,297,409	)		(3,876,081	)
Operating expenses	3,922,755		4,105,796		3,747,637
Investments in Project Partnerships		$	64,697			$	97,267		$	245,863		$	411,872		$	310,560		$	593,156
Interest expense	2,392,106		2,348,130		2,386,458
Depreciation and amortization	1,397,733		1,498,607		1,489,012
Total expenses	7,712,594		7,952,533		7,623,107
Net loss	$ (782,205)		$ (925,731)		$ (660,764)
Other partners' share of net loss	$ (4,368)		$ (4,084)		$ (131)
Gateway's share of net loss	$ (777,837)		$ (921,647)		$ (660,633)
Suspended losses	775,206		876,408		606,621
Equity in Loss of Project Partnerships	$ (2,631)		$ (45,239)		$ (54,012)

(1) In accordance with Gateway's accounting policy to not carry Investments in Project Partnerships below zero, cumulative suspended losses of $856,925 in Series 10 and $1,579,776 in Series 11 for the year ended March 31, 2011; and cumulative suspended losses of $719,103 in Series 10 and $1,392,126 in Series 11 for the year ended March 31, 2010 are not included.

NOTE 54 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

~~(1) As~~In ~~discussed~~accordance inwith ~~Note~~Gateway’s 4,policy ~~an affiliate~~ of ~~the~~presenting ~~General Partner (Value Partners, Inc.) is~~ the ~~operating~~financial ~~general~~information ~~partner in one~~ of the Project Partnerships ~~included~~on ina ~~Series~~three 8month ~~above~~lag, ~~(Logan~~below ~~Heights). The Logan Heights Project Partnership~~ is ~~not~~the ~~consolidated~~summarized inbalance ~~Gateway’s~~sheets ~~financial statements as Gateway’s investment in Logan Heights is accounted~~ for ~~under~~ the ~~equity~~Project ~~method. The~~Partnerships ~~information~~of ~~below~~Series is7 ~~included~~as ~~for~~of ~~related~~December ~~party~~31 ~~disclosure~~and ~~purposes. The~~the ~~Project~~summarized ~~Partnership’s~~statements ~~financial~~of ~~information~~operations for the ~~years~~year ~~ending~~ended December ~~2009~~31 ~~and~~of ~~December~~each ~~2008 is as follows~~year:

	December 2009		December 2008
		SERIES 7
Total Assets	$ 430,280		$ 479,080
		2010			2009			2008
Total Liabilities	798,477		803,320
SUMMARIZED BALANCE SHEETS
Gateway Deficit	(335,866)		(292,349)
Assets:
Other Partner's Deficit	(32,331)		(31,891)
Current assets		$	2,824,891		$	3,440,082		$	4,760,067
Total Revenue	161,288		154,655
Investment properties, net			13,171,200			16,183,940			20,471,291
Net Loss	$ (43,957)		$ (20,545)
Other assets			23,284			38,062			34,399
Total assets		$	16,019,375		$	19,662,084		$	25,265,757
Liabilities and Partners' Deficit:
Current liabilities		$	684,298		$	786,978		$	935,908
Long-term debt			21,032,703			24,463,674			30,468,234
Total liabilities			21,717,001			25,250,652			31,404,142
Partners' deficit
Limited Partner			(5,368,845	)		(5,270,577	)		(5,737,510	)
General Partners			(328,781	)		(317,991	)		(400,875	)
Total partners' deficit			(5,697,626	)		(5,588,568	)		(6,138,385	)
Total liabilities and partners' deficit		$	16,019,375		$	19,662,084		$	25,265,757
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income		$	4,434,943		$	5,284,523		$	6,397,144
Expenses:
Operating expenses			2,703,870			3,172,014			3,478,583
Interest expense			1,431,954			1,799,295			2,239,047
Depreciation and amortization			847,923			1,008,239			1,277,049
Total expenses			4,983,747			5,979,548			6,994,679
Net loss		$	(548,804	)	$	(695,025	)	$	(597,535	)
Other partners' share of net income		$	24,472		$	6,076		$	20,242
Gateway's share of net loss		$	(573,276	)	$	(701,101	)	$	(617,777	)
Suspended losses			573,276			701,101			618,484
Equity in Income of Project Partnerships		$	-		$	-		$	707

NOTE 54 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

In accordance with Gateway’s policy of presenting the financial information of the Project Partnerships on a three month lag, below is the summarized balance sheets for the Project Partnerships of Series 98 as of December 31 and the summarized statements of operations for the year ended December 31 of each year:

	SERIES 9
		SERIES 8 (1)
	2009		2008		2007
		2010				2009			2008
SUMMARIZED BALANCE SHEETS
Assets:
Current assets	~~$ 2,118,394~~	$	~~$ 2~~4,~~339~~220,~~114~~739		~~$ 2,260,038~~	$	4,271,715		$	4,572,520
Investment properties, net	~~13,284,407~~		1420,~~400~~572,~~684~~269		~~15,142,396~~		21,382,534			23,847,600
Other assets	~~30,637~~		16126,~~667~~899		~~42,650~~		341,101			252,930
Total assets	~~$ 15,433,438~~	$	~~$ 16~~24,~~756~~919,~~465~~907		~~$ 17,445,084~~	$	25,995,350		$	28,673,050
Liabilities and Partners' Deficit:
Current liabilities	~~$ 488,554~~	$	~~$ 463~~1,~~546~~549,539		~~$ 437,188~~	$	1,527,103		$	1,553,737
Long-term debt	~~18,523,562~~		1933,~~468~~041,~~844~~891		~~19,596,802~~		33,354,386			35,579,018
Total liabilities	~~19,012,116~~		1934,~~932~~591,~~390~~430		~~20,033,990~~		34,881,489			37,132,755
Partners' deficit
Limited Partner	~~(3,139,742)~~		(28,~~739~~833,~~514)~~568	)	~~(2,187,748)~~		(8,199,433	)		(7,701,622	)
General Partners	~~(438,936)~~		(~~436~~837,~~411)~~955	)	~~(401,158)~~		(686,706	)		(758,083	)
Total partners' deficit	~~(3,578,678)~~		(39,~~175~~671,~~925)~~523	)	~~(2,588,906)~~		(8,886,139	)		(8,459,705	)
Total liabilities and partners' deficit	~~$ 15,433,438~~	$	~~$ 16~~24,~~756~~919,~~465~~907		~~$ 17,445,084~~	$	25,995,350		$	28,673,050
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income	~~$ 3,633,336~~	$	~~$ 3~~6,~~756~~793,~~581~~755		~~$ 3,716,532~~	$	6,930,389		$	7,026,802
Expenses:
Operating expenses	~~2,173,411~~		24,~~178~~044,~~215~~264		~~2,004,049~~		3,922,755			4,105,796
Interest expense	~~1,265,381~~		12,~~328~~052,~~202~~741		~~1,368,618~~		2,392,106			2,348,130
Depreciation and amortization	~~747,222~~		~~790~~1,~~640~~420,237		~~784,023~~		1,397,733			1,498,607
Total expenses	~~4,186,014~~		47,~~297~~517,~~057~~242		~~4,156,690~~		7,712,594			7,952,533
Net loss	~~$ (552,678)~~	$	$ (~~540~~723,~~476)~~487	)	~~$ (440,158)~~	$	(782,205	)	$	(925,731	)
Other partners' share of net (loss) income	$ (5,527)		$ 2,180		$ (4,402)
Other partners' share of net loss		$	(5,520	)		$	(4,368	)	$	(4,084	)
Gateway's share of net loss	~~$ (547,151)~~	$	$ (~~542~~717,~~656)~~967	)	~~$ (435,756)~~	$	(777,837	)	$	(921,647	)
Suspended losses	~~542,242~~		~~454~~717,~~968~~967		~~335,351~~		775,206			876,408
Equity in Loss of Project Partnerships	~~$ (4,909)~~	$	~~$ (87,688)~~-		~~$ (100,405)~~	$	(2,631	)	$	(45,239	)

NOTE 54 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

In(1) As ~~accordance~~discussed ~~with~~in ~~Gateway’s~~Note ~~policy~~3, an affiliate of ~~presenting~~the General Partner (Value Partners, Inc.) is the ~~financial~~operating ~~information~~general partner in one of the Project Partnerships onincluded ain ~~three~~Series ~~month~~8 ~~lag,~~above ~~below~~(Logan Heights). The Logan Heights Project Partnership is ~~the~~not ~~summarized~~consolidated ~~balance~~in ~~sheets~~Gateway’s financial statements as Gateway’s investment in Logan Heights is accounted for under the ~~Project~~equity ~~Partnerships~~method. The ofinformation ~~Series~~below 10is asincluded offor ~~December~~related 31party ~~and~~disclosure ~~the~~purposes. The ~~summarized~~Project ~~statements~~Partnership’s offinancial ~~operations~~information for the ~~year~~years ~~ended~~ending December 312010 ofand ~~each~~December ~~year~~2009 is as follows:

	SERIES 10
		December 2010				December 2009
	2009		2008		2007
Total Assets		$	439,620			$	430,280
SUMMARIZED BALANCE SHEETS
Total Liabilities			794,593				798,477
Assets:
Gateway Deficit			(327,559	)			(335,866	)
Current assets	$ 1,953,105		$ 2,081,976		$ 1,992,544
Other Partner's Deficit			(27,414	)			(32,331	)
Investment properties, net	10,387,780		11,212,400		11,593,014
Total Revenue			141,186				161,288
Other assets	44,068		18,938		21,577
Net Income (Loss)		$	13,224			$	(43,957	)
Total assets	$ 12,384,953		$ 13,313,314		$ 13,607,135
Liabilities and Partners' Equity (Deficit):
Current liabilities	$ 499,015		$ 473,965		$ 443,396
Long-term debt	11,952,788		12,832,733		12,934,608
Total liabilities	12,451,803		13,306,698		13,378,004
Partners' equity (deficit)
Limited Partner	425,714		500,409		684,835
General Partners	(492,564)		(493,793)		(455,704)
Total partners' equity (deficit)	(66,850)		6,616		229,131
Total liabilities and partners' equity (deficit)	$ 12,384,953		$ 13,313,314		$ 13,607,135
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income	$ 2,239,370		$ 2,397,697		$ 2,355,826
Expenses:
Operating expenses	1,358,362		1,397,130		1,304,691
Interest expense	642,742		683,133		716,599
Depreciation and amortization	439,815		486,635		479,429
Total expenses	2,440,919		2,566,898		2,500,719
Net loss	$ (201,549)		$ (169,201)		$ (144,893)
Other partners' share of net income (loss)	$ 9,623		$ 1,335		$ (2,167)
Gateway's share of net loss	$ (211,172)		$ (170,536)		$ (142,726)
Suspended losses	182,847		171,332		67,390
Equity in (Loss) Income of Project Partnerships	$ (28,325)		$ 796		$ (75,336)

NOTE 54 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

In accordance with Gateway’s policy of presenting the financial information of the Project Partnerships on a three month lag, below is the summarized balance sheets for the Project Partnerships of Series 119 as of December 31 and the summarized statements of operations for the year ended December 31 of each year:

	SERIES 11
		SERIES 9
	2009		2008		2007
		2010				2009			2008
SUMMARIZED BALANCE SHEETS
Assets:
Current assets	~~$ 1,184,662~~	$	~~$ 1~~2,~~144~~143,~~132~~673		~~$ 1,123,100~~	$	2,118,394		$	2,339,114
Investment properties, net	~~9,030,941~~		912,~~435~~424,~~609~~657		~~9,900,312~~		13,284,407			14,400,684
Other assets	~~284,542~~		~~278~~35,~~980~~561		~~271,652~~		30,637			16,667
Total assets	~~$ 10,500,145~~	$	~~$ 10~~14,~~858~~603,~~721~~891		~~$ 11,295,064~~	$	15,433,438		$	16,756,465
Liabilities and Partners' Equity:
Liabilities and Partners' Deficit:
Current liabilities	~~$ 470,712~~	$	~~$ 429~~532,~~490~~780		~~$ 434,747~~	$	488,554		$	463,546
Long-term debt	~~9,799,866~~		917,~~916~~941,~~521~~049		~~10,035,475~~		18,523,562			19,468,844
Total liabilities	~~10,270,578~~		1018,~~346~~473,~~011~~829		~~10,470,222~~		19,012,116			19,932,390
Partners' equity (deficit)
Partners' deficit
Limited Partner	~~646,030~~		~~896~~(3,~~880~~408,830	)	~~1,175,899~~		(3,139,742	)		(2,739,514	)
General Partners	~~(416,463)~~		(~~384~~461,~~170)~~108	)	~~(351,057)~~		(438,936	)		(436,411	)
Total partners' equity	229,567		512,710		824,842
Total partners' deficit			(3,869,938	)			(3,578,678	)		(3,175,925	)
Total liabilities and partners' equity	$ 10,500,145		$ 10,858,721		$ 11,295,064
Total liabilities and partners' deficit		$	14,603,891			$	15,433,438		$	16,756,465
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income	~~$ 2,231,664~~	$	~~$ 2~~3,~~161~~690,~~398~~119		~~$ 2,114,552~~	$	3,633,336		$	3,756,581
Expenses:
Operating expenses	~~1,349,500~~		12,~~310~~159,~~769~~846		~~1,170,777~~		2,173,411			2,178,215
Interest expense	~~603,738~~		~~606~~1,~~842~~249,218		~~607,244~~		1,265,381			1,328,202
Depreciation and amortization	~~525,030~~		~~523~~733,~~527~~144		~~529,741~~		747,222			790,640
Total expenses	~~2,478,268~~		24,~~441~~142,~~138~~208		~~2,307,762~~		4,186,014			4,297,057
Net loss	~~$ (246,604)~~	$	$ (~~279~~452,~~740)~~089	)	~~$ (193,210)~~	$	(552,678	)	$	(540,476	)
Other partners' share of net (loss) income	~~$ (5,551)~~	$	~~$ 15~~(4,~~831~~521	)	~~$ (7,940)~~	$	(5,527	)	$	2,180
Gateway's share of net loss	~~$ (241,053)~~	$	$ (~~295~~447,~~571)~~568	)	~~$ (185,270)~~	$	(547,151	)	$	(542,656	)
Suspended losses	~~160,461~~		~~179~~447,~~920~~568		~~110,518~~		542,242			454,968
Equity in Loss of Project Partnerships	~~$ (80,592)~~	$	~~$ (115,651)~~-		~~$ (74,752)~~	$	(4,909	)	$	(87,688	)

NOTE 54 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

In accordance with Gateway’s policy of presenting the financial information of the Project Partnerships on a three month lag, below is the summarized balance sheets for the Project Partnerships of Series 710 ~~through 11~~ as of December 31 and the summarized statements of operations for the year ended December 31 of each year:

	TOTAL SERIES 7 - 11
		SERIES 10
	2009		2008		2007
		2010				2009			2008
SUMMARIZED BALANCE SHEETS
Assets:
Current assets	~~$ 12,967,958~~	$	~~$ 14~~2,~~897~~022,~~809~~394		~~$ 14,712,070~~	$	1,953,105		$	2,081,976
Investment properties, net	~~70,269,602~~		7910,~~367~~008,~~584~~691		~~86,475,826~~		10,387,780			11,212,400
Other assets	~~738,410~~		~~601~~62,~~914~~419		~~641,031~~		44,068			18,938
Total assets	~~$ 83,975,970~~	$	~~$ 94~~12,~~867~~093,~~307~~504		~~$ 101,828,927~~	$	12,384,953		$	13,313,314
Liabilities and Partners' Deficit:
Liabilities and Partners' Equity (Deficit):
Current liabilities	~~$ 3,772,362~~	$	~~$ 3~~492,~~856,646~~932		~~$ 3,949,189~~	$	499,015		$	473,965
Long-term debt	~~98,094,276~~		~~108~~11,~~265~~859,~~350~~858		~~113,376,800~~		11,952,788			12,832,733
Total liabilities	~~101,866,638~~		~~112~~12,~~121~~352,~~996~~790		~~117,325,989~~		12,451,803			13,306,698
Partners' deficit
Partners' equity (deficit)
Limited Partner	~~(15,538,008)~~		~~(14~~267,~~781,357)~~256		~~(13,168,443)~~		425,714			500,409
General Partners	~~(2,352,660)~~		(2526,~~473,332)~~542	)	~~(2,328,619)~~		(492,564	)		(493,793	)
Total partners' deficit	(17,890,668)		(17,254,689)		(15,497,062)
Total partners' equity (deficit)			(259,286	)			(66,850	)		6,616
Total liabilities and partners' deficit	$ 83,975,970		$ 94,867,307		$ 101,828,927
Total liabilities and partners' equity (deficit)		$	12,093,504			$	12,384,953		$	13,313,314
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income	~~$ 20,319,282~~	$	~~$ 21~~2,~~739~~307,~~622~~400		~~$ 22,358,828~~	$	2,239,370		$	2,397,697
Expenses:
Operating expenses	~~11,976,042~~		121,~~470~~394,~~493~~094		~~11,969,882~~		1,358,362			1,397,130
Interest expense	~~6,703,262~~		7618,~~205,354~~203		~~7,619,190~~		642,742			683,133
Depreciation and amortization	~~4,118,039~~		4439,~~576,458~~674		~~4,777,802~~		439,815			486,635
Total expenses	~~22,797,343~~		242,~~252~~451,~~305~~971		~~24,366,874~~		2,440,919			2,566,898
Net loss	~~$ (2,478,061)~~	$	$ (2144,~~512,683)~~571	)	~~$ (2,008,046)~~	$	(201,549	)	$	(169,201	)
Other partners' share of net income	~~$ 253~~	$	~~$ 35~~18,~~504~~920		~~$ 8,870~~	$	9,623		$	1,335
Gateway's share of net loss	~~$ (2,478,314)~~	$	$ (2163,~~548,187)~~491	)	~~$ (2,016,916)~~	$	(211,172	)	$	(170,536	)
Suspended losses	~~2,361,857~~		2137,~~301,112~~822		~~1,683,622~~		182,847			171,332
Equity in Loss of Project Partnerships	$ (116,457)		$ (247,075)		$ (333,294)
Equity in (Loss) Income of Project Partnerships		$	(25,669	)		$	(28,325	)	$	796

NOTE 54 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

In accordance with Gateway’s policy of presenting the financial information of the Project Partnerships on a three month lag, below is the summarized balance sheets for the Project Partnerships of Series 11 as of December 31 and the summarized statements of operations for the year ended December 31 of each year:

	SERIES 11
	2010			2009			2008
SUMMARIZED BALANCE SHEETS
Assets:
Current assets	$	1,096,882		$	1,184,662		$	1,144,132
Investment properties, net		8,318,124			9,030,941			9,435,609
Other assets		232,653			284,542			278,980
Total assets	$	9,647,659		$	10,500,145		$	10,858,721

Liabilities and Partners' Equity:
Current liabilities	$	470,370		$	470,712		$	429,490
Long-term debt		9,604,676			9,799,866			9,916,521
Total liabilities		10,075,046			10,270,578			10,346,011

Partners' equity (deficit)
Limited Partner		43,347			646,030			896,880
General Partners		(470,734	)		(416,463	)		(384,170	)
Total partners' equity		(427,387	)		229,567			512,710

Total liabilities and partners' equity	$	9,647,659		$	10,500,145		$	10,858,721

SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income	$	2,263,577		$	2,231,664		$	2,161,398
Expenses:
Operating expenses		1,449,775			1,349,500			1,310,769
Interest expense		596,315			603,738			606,842
Depreciation and amortization		525,157			525,030			523,527

Total expenses

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