Investments, Equity Method and Joint Ventures

12 Months Ended

Dec. 31, 2011

Investments, Equity Method and Joint Ventures

Equity Method Investments Disclosure [Text Block]

NOTE 2 - INVESTMENTS IN AND ADVANCES TO LOCAL LIMITED PARTNERSHIPS

As of December 31, 2011 and 2010, the Partnership holds limited partnership interests in one and two Local Limited Partnerships, respectively. The remaining Local Limited Partnership at December 31, 2011 owns a residential low income rental project consisting of 330 apartment units. The mortgage loans of this project are payable to a governmental agency.

The Partnership, as a limited partner, does not have a contractual relationship with the Local Limited Partnership or exercise control over the activities and operations, including refinancing or selling decisions, of the Local Limited Partnership, that would require or allow for consolidation. Accordingly, the Partnership accounts for its investment in the Local Limited Partnership using the equity method. The Partnership is allocated profits and losses of the Local Limited Partnership based upon its ownership percentage of 99%. Distributions of surplus cash from operations from the Local Limited Partnership are restricted by the Local Limited Partnership’s Regulatory Agreement with the United States Department of Housing and Urban Development (“HUD”). These restrictions limit the distribution to 12%, of the initial invested capital. The excess surplus cash is deposited into a residual receipts reserve, of which the ultimate realization by the Partnership is uncertain as HUD frequently retains it upon sale or dissolution of the Local Limited Partnership. The Partnership is allocated profits and losses and receives distributions from refinancings and sales in accordance with the Local Limited Partnership’s partnership agreement. This agreement usually limits the Partnership’s distributions to an amount substantially less than its ownership percentage in the Local Limited Partnership.

The individual investment is carried at cost plus the Partnership’s share of the Local Limited Partnership’s profits less the Partnership’s share of the Local Limited Partnership’s losses, distributions and impairment charges. See “Note 1 – Organization and Summary of Significant Accounting Policies” for a description of the impairment policy. The Partnership is not legally liable for the obligations of the Local Limited Partnership and is not otherwise committed to provide additional support to the Local Limited Partnership. Therefore, it does not recognize losses once its investment in the Local Limited Partnership reaches zero. Distributions from the Local Limited Partnership are accounted for as a reduction of the investment balance until the investment balance has been reduced to zero. When the investment balance has been reduced to zero, subsequent distributions received are recognized as income in the accompanying statements of operations. During the year ended December 31, 2011, the Partnership received an operating distribution of approximately $15,000 from one Local Limited Partnership in which the Partnership’s investment balance has been reduced to zero, which was recognized as income. There were no distributions received during the year ended December 31, 2010.

For those investments where the Partnership has determined that the carrying value of its investment approximates the estimated fair value of the investment, the Partnership’s policy is to recognize equity in income of the Local Limited Partnership only to the extent of distributions received and amortization of acquisition costs from the Local Limited Partnership. Therefore, the Partnership limits its recognition of equity earnings to the amount it expects to ultimately realize.

The Partnership has no carrying value in the investment in the Local Limited Partnership as of December 31, 2011 and 2010.

During the year ended December 31, 2010, the Partnership advanced approximately $1,000 to one Local Limited Partnership, Jenny Lind Hall II, L.P., to fund a tax payment. While not obligated to make advances to either of the Local Limited Partnerships, the Partnership made this advance in order to protect its economic investment in the Local Limited Partnership. This amount is included in advance to Local Limited Partnership recognized as expense for the year ended December 31, 2010, as the investment balance in the Local Limited Partnership had been reduced to zero. During the year ended December 31, 2011, the Partnership received repayment of advances of approximately $2,000 from this Local Limited Partnership. This repayment is recognized as recovery of advances made to Local Limited Partnership previously recognized as expense.

On December 21, 2011, Jenny Lind Hall II, L.P., sold its investment property to a third party for a gross sale price of $2,250,000. After payment of closing costs and repayment of the notes payable encumbering the property, the Partnership did not receive any proceeds from the sale. The Partnership had no investment balance remaining in this Local Limited Partnership as of December 31, 2011 or 2010.

Oshtemo Limited Dividend Housing Association was held for sale at December 31, 2011 as a result of the Partnership selling its limited partnership interest in the Local Limited Partnership on January 31, 2012. The Partnership assigned its limited partnership interest in Oshtemo Limited Dividend Housing Association to a third party for $350,000. The Partnership had no remaining investment balance in the Local Limited Partnership at December 31, 2011 and 2010. Oshtemo Limited Dividend Housing Association was the Partnership’s sole remaining investment. The Partnership anticipates liquidating by December 31, 2012.