Note 5 - Partnership Income Taxes

9 Months Ended

Sep. 30, 2012

Notes

Note 5 - Partnership Income Taxes

Note 5 – Partnership Income Taxes

The Partnership is subject to a New Jersey tax based upon the number of resident and non-resident limited partners and apportionment of income related to the Partnership’s investment in certain Local Partnerships. For the nine months ended September 30, 2012 and 2011 the expense related to this tax is reflected in tax expense in the accompanying statements of operations. At December 31, 2011, the Partnership’s estimate of the balance of the tax due for 2011 to the state of New Jersey was approximately $44,000 and this amount was included in accounts payable and accrued expenses on the accompanying balance sheet as of December 31, 2011. The actual balance of the tax due for 2011 was approximately $87,000 and was paid during the nine months ended September 30, 2012. The additional tax of approximately $43,000 owed for 2011 taxes is attributable to the sale of interest in Countryside as discussed above and is included as a reduction of gain on sale during the nine months ended September 30, 2012. In addition, during the nine months ended September 30, 2012, the Partnership paid approximately $66,000 as a required deposit for estimated 2012 New Jersey taxes, which is based on half of the previous year’s taxes. However, the Partnership’s estimate of the actual tax due for 2012 is approximately $12,000, of which approximately $3,000 and $9,000 has been recognized as expense during the three and nine months ended September 30, 2012, respectively. The remaining balance paid of approximately $57,000 is reflected as an other asset on the accompanying balance sheet at September 30, 2012.