10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended:  June 30, 2014

Commission File Number:  000-29274

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

(Exact name of registrant as specified in its charter)

State of Minnesota	41-1789725
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
30 East 7th Street, Suite 1300 St. Paul, Minnesota 55101	(651) 227-7333
(Address of principal executive offices)	(Registrant’s telephone number)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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.     x Yes    o 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 for such shorter period that the registrant was required to submit and post such files).     x Yes    o No

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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

o Large accelerated filer	o Accelerated filer
o Non-accelerated filer	x Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     o Yes    x No

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

INDEX

				Page
Part I – Financial Information
	Item 1.	Financial Statements:
		Balance Sheet as of June 30, 2014 and December 31, 2013		3
		Statements for the Periods ended June 30, 2014 and 2013:
			Income	4
			Cash Flows	5
			Changes in Partners’ Capital (Deficit)	6
		Notes to Financial Statements		7 - 13
	Item 2.	Management's Discussion and Analysis of Financial
			Condition and Results of Operations	14 - 19
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk		20
	Item 4.	Controls and Procedures		20
Part II – Other Information
	Item 1.	Legal Proceedings		20
	Item 1A.	Risk Factors		20
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		21
	Item 3.	Defaults Upon Senior Securities		21
	Item 4.	Mine Safety Disclosures		21
	Item 5.	Other Information		21
	Item 6.	Exhibits		21
Signatures				22

Page 2 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

BALANCE SHEET

ASSETS

	June 30,			December 31,
	2014			2013
	(unaudited)
Current Assets:
Cash	$	4,756,932		$	5,553,960
Real Estate Held for Investment:
Land		3,566,183			2,866,183
Buildings and Equipment		10,216,447			8,809,264
Acquired Intangible Lease Assets		185,920			0
Real Estate Investments, at cost		13,968,550			11,675,447
Accumulated Depreciation and Amortization		(2,716,676	)		(2,533,686	)
Real Estate Held for Investment, Net		11,251,874			9,141,761
Real Estate Held for Sale		0			1,508,930
Equity Method Investment Held for Sale		433,446			0
Total Real Estate		11,685,320			10,650,691
Total Assets	$	16,442,252		$	16,204,651

LIABILITIES AND PARTNERS' CAPITAL

Current Liabilities:
Payable to AEI Fund Management, Inc.	$	24,882	$	11,049
Distributions Payable		291,922		291,922
Unearned Rent		47,027		12,121
Total Current Liabilities		363,831		315,092
Long-term Liabilities:
Acquired Below-Market Lease Intangibles, Net		79,687		0
Partners’ Capital:
General Partners		12,296		11,205
Limited Partners – 24,000 Units authorized;    22,653 Units issued and outstanding		15,986,438		15,878,354
Total Partners' Capital		15,998,734		15,889,559
Total Liabilities and Partners' Capital	$	16,442,252	$	16,204,651

The accompanying Notes to Financial Statements are an integral part of this statement.

Page 3 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

STATEMENT OF INCOME

(unaudited)

	Three Months Ended June 30				Six Months Ended June 30
	2014		2013		2014		2013
Rental Income	$	257,674	$	239,715	$	499,411	$	478,235
Expenses:
Partnership Administration – Affiliates		52,851		50,375		108,310		101,479
Partnership Administration and Property    Management – Unrelated Parties		12,769		14,559		32,683		25,044
Property Acquisition		25,820		0		25,820		0
Depreciation and Amortization		94,897		88,093		182,990		176,186
Total Expenses		186,337		153,027		349,803		302,709
Operating Income		71,337		86,688		149,608		175,526
Other Income:
Interest Income		3,365		1,577		7,352		3,151
Income from Continuing Operations		74,702		88,265		156,960		178,677
Income from Discontinued Operations		476,467		64,131		536,059		128,611
Net Income	$	551,169	$	152,396	$	693,019	$	307,288
Net Income Allocated:
General Partners	$	5,511	$	1,524	$	6,930	$	3,073
Limited Partners		545,658		150,872		686,089		304,215
Total	$	551,169	$	152,396	$	693,019	$	307,288
Income per Limited Partnership Unit:
Continuing Operations	$	3.26	$	3.86	$	6.86	$	7.81
Discontinued Operations		20.83		2.80		23.43		5.62
Total – Basic and Diluted	$	24.09	$	6.66	$	30.29	$	13.43
Weighted Average Units Outstanding –       Basic and Diluted		22,653		22,653		22,653		22,653

The accompanying Notes to Financial Statements are an integral part of this statement.

Page 4 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

STATEMENT OF CASH FLOWS

(unaudited)

	Six Months Ended June 30
	2014			2013
Cash Flows from Operating Activities:
Net Income	$	693,019		$	307,288
Adjustments to Reconcile Net Income To Net Cash Provided by Operating Activities:
Depreciation and Amortization		182,074			245,468
Income from Equity Method Investment Held for Sale		(512,347	)		0
Increase (Decrease) in Payable to    AEI Fund Management, Inc.		13,833			(20,636	)
Increase (Decrease) in Unearned Rent		34,906			9,090
Total Adjustments		(281,534	)		233,922
Net Cash Provided By    Operating Activities		411,485			541,210
Cash Flows from Investing Activities:
Investments in Real Estate		(2,212,500	)		0
Cash Paid for Equity Method Investment Held for Sale		(12,169	)		0
Distributions from Equity Method Investment Held for Sale		1,600,000			0
Net Cash Provided By (Used For)    Investing Activities		(624,669	)		0
Cash Flows from Financing Activities:
Distributions Paid to Partners		(583,844	)		(587,879	)
Net Increase (Decrease) in Cash		(797,028	)		(46,669	)
Cash, beginning of period		5,553,960			2,259,911
Cash, end of period	$	4,756,932		$	2,213,242
Supplemental Disclosure of Non-Cash Investing Activities:
Contribution of Real Estate in Exchange for    Equity Method Investment	$	1,508,930		$	0

The accompanying Notes to Financial Statements are an integral part of this statement.

Page 5 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)

(unaudited)

	General Partners			Limited Partners			Total			Limited Partnership Units Outstanding
Balance, December 31, 2012	$	686		$	15,658,370		$	15,659,056			22,653.11
Distributions Declared		(5,878	)		(582,000	)		(587,878	)
Net Income		3,073			304,215			307,288
Balance, June 30, 2013	$	(2,119	)	$	15,380,585		$	15,378,466			22,653.11
Balance, December 31, 2013	$	11,205		$	15,878,354		$	15,889,559			22,653.11
Distributions Declared		(5,839	)		(578,005	)		(583,844	)
Net Income		6,930			686,089			693,019
Balance, June 30, 2014	$	12,296		$	15,986,438		$	15,998,734			22,653.11

The accompanying Notes to Financial Statements are an integral part of this statement.

Page 6 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2014

(unaudited)

(1)  The condensed statements included herein have been prepared by the registrant, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission, and reflect all adjustments which are, in the opinion of management, necessary to a fair statement of the results of operations for the interim period, on a basis consistent with the annual audited statements.  The adjustments made to these condensed statements consist only of normal recurring adjustments.  Certain information, accounting policies, and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the registrant believes that the disclosures are adequate to make the information presented not misleading.  It is suggested that these condensed financial statements be read in conjunction with the financial statements and the summary of significant accounting policies and notes thereto included in the registrant’s latest annual report on Form 10-K.

(2)  Organization –

AEI Income & Growth Fund XXI Limited Partnership (“Partnership”) was formed to acquire and lease commercial properties to operating tenants.  The Partnership's operations are managed by AEI Fund Management XXI, Inc. (“AFM”), the Managing General Partner.  Robert P. Johnson, the President and sole director of AFM, serves as the Individual General Partner.  AFM is a wholly owned subsidiary of AEI Capital Corporation of which Mr. Johnson is the majority shareholder.  AEI Fund Management, Inc. (“AEI”), an affiliate of AFM, performs the administrative and operating functions for the Partnership.

The terms of the Partnership offering called for a subscription price of $1,000 per Limited Partnership Unit, payable on acceptance of the offer.  The Partnership commenced operations on April 14, 1995 when minimum subscriptions of 1,500 Limited Partnership Units ($1,500,000) were accepted.  On January 31, 1997, the offering terminated when the maximum subscription limit of 24,000 Limited Partnership Units was reached.  Under the terms of the Limited Partnership Agreement, the Limited Partners and General Partners contributed funds of $24,000,000 and $1,000, respectively.

During operations, any Net Cash Flow, as defined, which the General Partners determine to distribute will be distributed 90% to the Limited Partners and 10% to the General Partners; provided, however, that such distributions to the General Partners will be subordinated to the Limited Partners first receiving an annual, noncumulative distribution of Net Cash Flow equal to 10% of their Adjusted Capital Contribution, as defined, and, provided further, that in no event will the General Partners receive less than 1% of such Net Cash Flow per annum.  Distributions to Limited Partners will be made pro rata by Units.

Page 7 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

NOTES TO FINANCIAL STATEMENTS

(Continued)

(2)  Organization – (Continued)

Any Net Proceeds of Sale, as defined, from the sale or financing of properties which the General Partners determine to distribute will, after provisions for debts and reserves, be paid in the following manner: (i) first, 99% to the Limited Partners and 1% to the General Partners until the Limited Partners receive an amount equal to: (a) their Adjusted Capital Contribution plus (b) an amount equal to 10% of their Adjusted Capital Contribution per annum, cumulative but not compounded, to the extent not previously distributed from Net Cash Flow;  (ii) any remaining balance will be distributed 90% to the Limited Partners and 10% to the General Partners.  Distributions to the Limited Partners will be made pro rata by Units.

For tax purposes, profits from operations, other than profits attributable to the sale, exchange, financing, refinancing or other disposition of property, will be allocated first in the same ratio in which, and to the extent, Net Cash Flow is distributed to the Partners for such year.  Any additional profits will be allocated in the same ratio as the last dollar of Net Cash Flow is distributed.  Net losses from operations will be allocated 99% to the Limited Partners and 1% to the General Partners.

For tax purposes, profits arising from the sale, financing, or other disposition of property will be allocated in accordance with the Partnership Agreement as follows: (i) first, to those partners with deficit balances in their capital accounts in an amount equal to the sum of such deficit balances; (ii) second, 99% to the Limited Partners and 1% to the General Partners until the aggregate balance in the Limited Partners' capital accounts equals the sum of the Limited Partners' Adjusted Capital Contributions plus an amount equal to 10% of their Adjusted Capital Contributions per annum, cumulative but not compounded, to the extent not previously allocated; (iii) third, the balance of any remaining gain will then be allocated 90% to the Limited Partners and 10% to the General Partners.  Losses will be allocated 98% to the Limited Partners and 2% to the General Partners.

The General Partners are not required to currently fund a deficit capital balance.  Upon liquidation of the Partnership or withdrawal by a General Partner, the General Partners will contribute to the Partnership an amount equal to the lesser of the deficit balances in their capital accounts or 1% of total Limited Partners' and General Partners' capital contributions.

In January 2014, the Managing General Partner mailed a Consent Statement (Proxy) seeking the consent of the Limited Partners to continue the Partnership for an additional 60 months or to initiate the final disposition, liquidation and distribution of all of the Partnership’s properties and assets.  On February 14, 2014, the proposal to continue the Partnership was approved with a majority of Units voted in favor of the continuation proposal.  As a result, the Managing General Partner will continue the operations of the Partnership for an additional 60 months at which time it will again ask the Limited Partners to vote on the same two proposals.

Page 8 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

NOTES TO FINANCIAL STATEMENTS

(Continued)

(3)  Summary of Significant Accounting Policies –

Real Estate

Upon acquisition of real properties, the Partnership records them in the financial statements at cost.  The purchase price is allocated to tangible assets, consisting of land and building, and to identified intangible assets and liabilities, which may include the value of above market and below market leases and the value of in-place leases.  The allocation of the purchase price is based upon the fair value of each component of the property.  Although independent appraisals may be used to assist in the determination of fair value, in many cases these values will be based upon management’s assessment of each property, the selling prices of comparable properties and the discounted value of cash flows from the asset.

The fair values of above market and below market in-place leases will be recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) an estimate of fair market lease rates for the corresponding in-place leases measured over a period equal to the non-cancelable term of the lease including any bargain renewal periods.  The above market and below market lease values will be capitalized as intangible lease assets or liabilities.  Above market lease values will be amortized as an adjustment of rental income over the remaining terms of the respective leases.  Below market leases will be amortized as an adjustment of rental income over the remaining term of the respective leases, including any bargain renewal periods.  If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above market and below market in-place lease values relating to that lease would be recorded as an adjustment to rental income.

The fair values of in-place leases will include estimated direct costs associated with obtaining a new tenant, and opportunity costs associated with lost rentals which are avoided by acquiring an in-place lease.  Direct costs associated with obtaining a new tenant may include commissions, tenant improvements, and other direct costs and are estimated, in part, by management’s consideration of current market costs to execute a similar lease.  These direct costs will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases.  The value of opportunity costs will be calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease.  These intangibles will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases.  If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed.

Page 9 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

NOTES TO FINANCIAL STATEMENTS

(Continued)

(3)  Summary of Significant Accounting Policies – (Continued)

The Partnership tests real estate for recoverability when events or changes in circumstances indicate that the carrying value may not be recoverable.  For properties the Partnership will hold and operate, it compares the carrying amount of the property to the estimated probability-weighted future undiscounted cash flows expected to result from the property and its eventual disposition.  If the sum of the expected future cash flows is less than the carrying amount of the property, the Partnership recognizes an impairment loss by the amount by which the carrying amount of the property exceeds the fair value of the property.  For properties held for sale, the Partnership determines whether impairment has occurred by comparing the property’s estimated fair value less cost to sell to its current carrying value.  If the carrying value is greater than the net realizable value, an impairment loss is recorded to reduce the carrying value of the property to its net realizable value.

(4) Recently Adopted Accounting Standards –

In April 2014, the FASB issued ASU No. 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360) Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.”  This topic amends the requirements for reporting discontinued operations.  The disposal of a component must represent a strategic shift that will have a major effect on the Partnership’s operations and financial results in order to be reported as discontinued operations, and require certain additional interim and annual disclosures.  The amendments in this ASU are effective for reporting periods beginning after December 15, 2014 with early adoption permitted.  The Partnership has early adopted this standard effective January 1, 2014 and has applied the provisions prospectively.  As a result, the Partnership anticipates that properties will not be considered discontinued operations when the properties are sold after January 1, 2014, with the exception of properties that were classified as Real Estate Held for Sale at December 31, 2013.

(5)  Reclassification –

Certain items related to discontinued operations in the prior year’s financial statements have been reclassified to conform to 2014 presentation.  These reclassifications had no effect on Partners’ capital, net income or cash flows.

Page 10 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

NOTES TO FINANCIAL STATEMENTS

(Continued)

(6)  Real Estate Held for Investment –

On May 29, 2014, the Partnership purchased a 50% interest in a Tractor Supply Company store in Canton, Georgia for $2,212,500.  The Partnership allocated $185,920 of the purchase price to Acquired Intangible Lease Assets, representing in-place lease intangibles and allocated $80,603 to Acquired Below-Market Lease Intangibles. The Partnership incurred $25,820 of acquisition expenses related to the purchase that were expensed.  The property is leased to Tractor Supply Company under a Lease Agreement with a remaining primary term of 7.3 years (as of the date of purchase) and annual rent of $164,355 for the interest purchased.  The remaining interest in the property was purchased by AEI Accredited Investor Fund V LP, an affiliate of the Partnership.

For the six months ended June 30, 2014 and 2013, the value of in-place lease intangibles amortized to expense was $2,113 and $0, respectively, and the increase to rental income for below-market leases was $916 and $0, respectively.  For lease intangibles not held for sale at June 30, 2014, the weighted average remaining life is 87 months, the estimated amortization expense is $25,353 and the estimated increase to rental income is $10,991 for each of the next five succeeding years.

On July 3, 2014, the Partnership purchased a 30% interest in a Gander Mountain store in Champaign, Illinois for $2,122,500.  The property is leased to Gander Mountain Company under a Lease Agreement with a remaining primary term of 14.9 years and annual rent of $167,772 for the interest purchased.  The remaining interests in the property were purchased by AEI Accredited Investor Fund V LP and AEI National Income Property Fund VIII LP, affiliates of the Partnership.

(7) Equity Method Investment Held for Sale –

In the fourth quarter of 2013, the Partnership decided to sell its 20% interest in the CarMax Auto Superstore in Lithia Springs, Georgia.  The remaining interests in the property are owned by three affiliated entities, AEI Income & Growth Fund 24 LLC, AEI Income & Growth Fund 25 LLC and AEI Private Net Lease Millennium Fund Limited Partnership.  On March 7, 2014, to facilitate the sale of the property, the Partnership and affiliated entities contributed their respective interests in the property via a limited liability company to CM Lithia Springs DST (“CMLS”), a Delaware statutory trust (“DST”), in exchange for Class B ownership interests in CMLS.  In addition, a small amount of cash was contributed for working capital.  A DST is a recognized mechanism for selling property to investors who are looking for replacement real estate to complete like-kind exchanges under Section 1031 of the Internal Revenue Code.  As investors purchase Class A ownership interests in CMLS, the proceeds received will be used to redeem, on a one-for-one basis, the Class B ownership interests of the Partnership and affiliated entities.

Page 11 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

NOTES TO FINANCIAL STATEMENTS

(Continued)

(7) Equity Method Investment Held for Sale – (Continued)

The investment in CMLS is recorded using the equity method of accounting in the accompanying financial statements.  Under the equity method, the investment in CMLS is stated at cost and adjusted for the Partnership’s share of net income or losses and reduced by distributions received by the Partnership.  As of June 30, 2014, the investment balance consists of the following:

Real Estate Contributed	$	1,508,930
Cash Contributed		12,169
Net Income		512,347
Distributions Received		(1,600,000)
Equity Method Investment Held for Sale	$	433,446

(8)  Payable to AEI Fund Management, Inc. –

AEI Fund Management, Inc. performs the administrative and operating functions for the Partnership.  The payable to AEI Fund Management represents the balance due for those services.  This balance is non-interest bearing and unsecured and is to be paid in the normal course of business.

(9)  Discontinued Operations –

On August 2, 2013, the Partnership sold its 39% interest in the Scott & White Clinic in College Station, Texas to an unrelated third party.  The Partnership received net sale proceeds of $1,822,494, which resulted in a net gain of $512,842.  At the time of sale, the cost and related accumulated depreciation was $1,433,468 and $123,816, respectively.

In June 2013, the Partnership entered into an agreement to sell its 62% interest in the Applebee’s restaurant in Johnstown, Pennsylvania to an unrelated third party.  On August 23, 2013, the sale closed with the Partnership receiving net sale proceeds of $1,958,905, which resulted in a net gain of $615,907.  At the time of sale, the cost and related accumulated depreciation was $1,682,887 and $339,889, respectively.

In the fourth quarter of 2013, the Partnership decided to sell its 20% interest in the CarMax Auto Superstore in Lithia Springs, Georgia.  On March 7, 2014, to facilitate the sale of the property, the Partnership contributed its interest in the property via a limited liability company to CM Lithia Springs DST as described in Note 7.  At December 31, 2013, the property was classified as Real Estate Held for Sale with a carrying value of $1,508,930.

Page 12 of 22

AEI INCOME & GROWTH FUND XXI LIMITED PARTNERSHIP

NOTES TO FINANCIAL STATEMENTS

(Continued)

(9)  Discontinued Operations – (Continued)

During the first six months of 2014 and 2013, the Partnership distributed net sale proceeds of $163,115 and $35,123, respectively.  The Limited Partners received distributions of $161,484 and $34,772 and the General Partners received distributions of $1,631 and $351 for the periods, respectively.  The Limited Partners’ distributions represented $7.13 and $1.53 per Unit for the periods, respectively.

The financial results for these properties are reflected as Discontinued Operations in the accompanying financial statements.  The following are the results of discontinued operations:

		Three Months Ended June 30				Six Months Ended June 30
		2014		2013		2014		2013
Rental Income	$	0	$	99,211	$	26,740	$	198,423
Property Management Expenses		(3,016)		(439)		(3,028)		(530)
Depreciation		0		(34,641)		0		(69,282)
Income from Equity Method Investment    Held for Sale		479,483		0		512,347		0
Income from Discontinued Operations	$	476,467	$	64,131	$	536,059	$	128,611

		Three Months Ended June 30				Six Months Ended June 30
		2014		2013		2014		2013
Cash Flows from Discontinued Operations:
Operating Activities	$	(3,016)	$	98,772	$	23,712	$	197,893
Investing Activities	$	1,600,000	$	0	$	1,587,831	$	0

(10)  Fair Value Measurements –

As of June 30, 2014 and December 31, 2013, the Partnership had no assets or liabilities measured at fair value on a recurring basis or nonrecurring basis.

Page 13 of 22

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS.

This section contains "forward-looking statements" which represent management's expectations or beliefs concerning future events, including statements regarding anticipated application of cash, expected returns from rental income, growth in revenue, the sufficiency of cash to meet operating expenses, rates of distribution, and other matters.  These, and other forward-looking statements, should be evaluated in the context of a number of factors that may affect the Partnership's financial condition and results of operations, including the following:

— Market and economic conditions which affect the value of the properties the Partnership owns and the cash from rental income such properties generate;

— the federal income tax consequences of rental income, deductions, gain on sales and other items and the effects of these consequences for the Partners;

— resolution by the General Partners of conflicts with which they may be confronted;

— the success of the General Partners of locating properties with favorable risk return characteristics;

— the effect of tenant defaults; and

— the condition of the industries in which the tenants of properties owned by the Partnership operate.

Application of Critical Accounting Policies

The Partnership’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (US GAAP).  Preparing the financial statements requires management to use judgment in the application of these accounting policies, including making estimates and assumptions.  These judgments will affect the reported amounts of the Partnership’s assets and liabilities and the disclosure of contingent assets and liabilities as of the dates of the financial statements and will affect the reported amounts of revenue and expenses during the reporting periods.  It is possible that the carrying amount of the Partnership’s assets and liabilities, or the results of reported operations, will be affected if management’s estimates or assumptions prove inaccurate.

Management of the Partnership evaluates the following accounting estimates on an ongoing basis, and has discussed the development and selection of these estimates and the management discussion and analysis disclosures regarding them with managing partner of the Partnership.

Allocation of Purchase Price of Acquired Properties

Upon acquisition of real properties, the Partnership records them in the financial statements at cost.  The purchase price is allocated to tangible assets, consisting of land and building, and to identified intangible assets and liabilities, which may include the value of above market and below market leases and the value of in-place leases.  The allocation of the purchase price is based upon the fair value of each component of the property.  Although independent appraisals may be used to assist in the determination of fair value, in many cases these values will be based upon management’s assessment of each property, the selling prices of comparable properties and the discounted value of cash flows from the asset.

Page 14 of 22

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS.  (Continued)

The fair values of above market and below market in-place leases will be recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) an estimate of fair market lease rates for the corresponding in-place leases measured over a period equal to the non-cancelable term of the lease including any bargain renewal periods.  The above market and below market lease values will be capitalized as intangible lease assets or liabilities.  Above market lease values will be amortized as an adjustment of rental income over the remaining terms of the respective leases.  Below market leases will be amortized as an adjustment of rental income over the remaining term of the respective leases, including any bargain renewal periods.  If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above market and below market in-place lease values relating to that lease would be recorded as an adjustment to rental income.

The fair values of in-place leases will include estimated direct costs associated with obtaining a new tenant, and opportunity costs associated with lost rentals which are avoided by acquiring an in-place lease.  Direct costs associated with obtaining a new tenant may include commissions, tenant improvements, and other direct costs and are estimated, in part, by management’s consideration of current market costs to execute a similar lease.  These direct costs will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases.  The value of opportunity costs will be calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease.  These intangibles will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases.  If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed.

The determination of the fair values of the assets and liabilities acquired will require the use of significant assumptions with regard to the current market rental rates, rental growth rates, discount and capitalization rates, interest rates and other variables.  If management’s estimates or assumptions prove inaccurate, the result would be an inaccurate allocation of purchase price, which could impact the amount of reported net income.

Carrying Value of Properties

Properties are carried at original cost, less accumulated depreciation and amortization.  The Partnership tests long-lived assets for recoverability when events or changes in circumstances indicate that the carrying value may not be recoverable.  For properties the Partnership will hold and operate, management determines whether impairment has occurred by comparing the property’s probability-weighted future undiscounted cash flows to its current carrying value.  For properties held for sale, management determines whether impairment has occurred by comparing the property’s estimated fair value less cost to sell to its current carrying value.  If the carrying value is greater than the net realizable value, an impairment loss is recorded to reduce the carrying value of the property to its net realizable value.  Changes in these assumptions or analysis may cause material changes in the carrying value of the properties.

Page 15 of 22

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS.  (Continued)

Allocation of Expenses

AEI Fund Management, Inc. allocates expenses to each of the funds they manage primarily on the basis of the number of hours devoted by their employees to each fund’s affairs.  They also allocate expenses at the end of each month that are not directly related to a fund’s operations based upon the number of investors in the fund and the fund’s capitalization relative to other funds they manage.  The Partnership reimburses these expenses subject to detailed limitations contained in the Partnership Agreement.

Results of Operations

For the six months ended June 30, 2014 and 2013, the Partnership recognized rental income from continuing operations of $499,411 and $478,235, respectively.  In 2014, rental income increased due to additional rent received from one property acquisition in 2014 and rent increases on two properties.  Based on the scheduled rent for the properties owned as of July 31, 2014, the Partnership expects to recognize rental income from continuing operations of approximately $1,149,000 in 2014.

For the six months ended June 30, 2014 and 2013, the Partnership incurred Partnership administration expenses from affiliated parties of $108,310 and $101,479, respectively.  These administration expenses include costs associated with the management of the properties, processing distributions, reporting requirements and communication with the Limited Partners.  During the same periods, the Partnership incurred Partnership administration and property management expenses from unrelated parties of $32,683 and $25,044, respectively.  These expenses represent direct payments to third parties for legal and filing fees, direct administrative costs, outside audit costs, taxes, insurance and other property costs.

For the six months ended June 30, 2014, the Partnership incurred property acquisition expenses of $25,820 related to the purchase of the Tractor Supply Company store in Canton, Georgia.

For the six months ended June 30, 2014 and 2013, the Partnership recognized interest income of $7,352 and $3,151, respectively.  In 2014, interest income increased primarily due to the Partnership having more money invested in a money market account due to two property sales in 2013.

Prior to January 1, 2014, upon complete disposal of a property or classification of a property as Real Estate Held for Sale, the Partnership included the operating results and sale of the property in discontinued operations.  In addition, the Partnership reclassified the prior periods’ operating results of the property to discontinued operations.  For the six months ended June 30, 2014, the Partnership recognized income from discontinued operations of $536,059, representing rental income less property management expenses of $23,712 and income from an equity method investment held for sale of $512,347.  For the six months ended June 30, 2013, the Partnership recognized income from discontinued operations of $128,611, representing rental income less property management expenses and depreciation.

Page 16 of 22

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS.  (Continued)

On August 2, 2013, the Partnership sold its 39% interest in the Scott & White Clinic in College Station, Texas to an unrelated third party.  The Partnership received net sale proceeds of $1,822,494, which resulted in a net gain of $512,842.  At the time of sale, the cost and related accumulated depreciation was $1,433,468 and $123,816, respectively.

In June 2013, the Partnership entered into an agreement to sell its 62% interest in the Applebee’s restaurant in Johnstown, Pennsylvania to an unrelated third party.  On August 23, 2013, the sale closed with the Partnership receiving net sale proceeds of $1,958,905, which resulted in a net gain of $615,907.  At the time of sale, the cost and related accumulated depreciation was $1,682,887 and $339,889, respectively.

In the fourth quarter of 2013, the Partnership decided to sell its 20% interest in the CarMax Auto Superstore in Lithia Springs, Georgia.  The remaining interests in the property are owned by three affiliated entities, AEI Income & Growth Fund 24 LLC, AEI Income & Growth Fund 25 LLC and AEI Private Net Lease Millennium Fund Limited Partnership.  On March 7, 2014, to facilitate the sale of the property, the Partnership and affiliated entities contributed their respective interests in the property via a limited liability company to CM Lithia Springs DST (“CMLS”), a Delaware statutory trust (“DST”), in exchange for Class B ownership interests in CMLS.  In addition, a small amount of cash was contributed for working capital.  A DST is a recognized mechanism for selling property to investors who are looking for replacement real estate to complete like-kind exchanges under Section 1031 of the Internal Revenue Code.  As investors purchase Class A ownership interests in CMLS, the proceeds received will be used to redeem, on a one-for-one basis, the Class B ownership interests of the Partnership and affiliated entities.  At December 31, 2013, the property was classified as Real Estate Held for Sale with a carrying value of $1,508,930.

The investment in CMLS is recorded using the equity method of accounting in the accompanying financial statements.  Under the equity method, the investment in CMLS is stated at cost and adjusted for the Partnership’s share of net income or losses and reduced by distributions received by the Partnership.

Management believes inflation has not significantly affected income from operations.  Leases may contain rent increases, based on the increase in the Consumer Price Index over a specified period, which will result in an increase in rental income over the term of the leases.  Inflation also may cause the real estate to appreciate in value.  However, inflation and changing prices may have an adverse impact on the operating margins of the properties' tenants, which could impair their ability to pay rent and subsequently reduce the Net Cash Flow available for distributions.

Page 17 of 22

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS.  (Continued)

Liquidity and Capital Resources

During the six months ended June 30, 2014, the Partnership's cash balances decreased $797,028 as a result of cash used to purchase property and distributions paid to the Partners in excess of cash generated from operating activities, which were partially offset by cash distributions received from an equity method investment held for sale.  During the six months ended June 30, 2013, the Partnership's cash balances decreased $46,669 as a result of distributions paid to the Partners in excess of cash generated from operating activities.

Net cash provided by operating activities decreased from $541,210 in 2013 to $411,485 in 2014 as a result of a decrease in total rental and interest income in 2014 and an increase in Partnership administration and property management expenses in 2014, which were partially offset by net timing differences in the collection of payments from the tenants and the payment of expenses.  During 2014, cash from operations was reduced by $25,820 of acquisition expenses related to the purchase of real estate.  Pursuant to accounting guidance, these expenses were reflected as operating cash outflows.  However, pursuant to the Partnership Agreement, acquisition expenses were funded with proceeds from property sales.

The major components of the Partnership's cash flow from investing activities are investments in real estate and proceeds from the sale of real estate, including distributions from an equity method investment held for sale.  During the six months ended June 30, 2014, the Partnership expended $2,212,500 to invest in real properties as the Partnership reinvested cash generated from property sales.  During the six months ended June 30, 2014, the Partnership paid cash for an equity method investment held for sale of $12,169.  During the six months ended June 30, 2014, the Partnership received distributions from an equity method investment of $1,600,000.  The source of all but a small portion of these distributions was proceeds from the sale of the CarMax Auto Superstore as discussed above.

On May 29, 2014, the Partnership purchased a 50% interest in a Tractor Supply Company store in Canton, Georgia for $2,212,500.  The property is leased to Tractor Supply Company under a Lease Agreement with a remaining primary term of 7.3 years (as of the date of purchase) and annual rent of $164,355 for the interest purchased.  The remaining interest in the property was purchased by AEI Accredited Investor Fund V LP, an affiliate of the Partnership.

On July 3, 2014, the Partnership purchased a 30% interest in a Gander Mountain store in Champaign, Illinois for $2,122,500.  The property is leased to Gander Mountain Company under a Lease Agreement with a remaining primary term of 14.9 years and annual rent of $167,772 for the interest purchased.  The remaining interests in the property were purchased by AEI Accredited Investor Fund V LP and AEI National Income Property Fund VIII LP, affiliates of the Partnership.

The Partnership's primary use of cash flow, other than investment in real estate, is distribution and redemption payments to Partners.  The Partnership declares its regular quarterly distributions before the end of each quarter and pays the distribution in the first week after the end of each quarter.  The Partnership attempts to maintain a stable distribution rate from quarter to quarter.  Redemption payments are paid to redeeming Partners on a semi-annual basis.

Page 18 of 22

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS.  (Continued)

For the six months ended June 30, 2014 and 2013, the Partnership declared distributions of $583,844 and $587,878, respectively, which were distributed 99% to the Limited Partners and 1% to the General Partners.  The Limited Partners received distributions of $578,005 and $582,000 and the General Partners received distributions of $5,839 and $5,878 for the periods, respectively.

As part of the distributions discussed above, the Partnership distributed net sale proceeds of $163,115 and $35,123 in 2014 and 2013, respectively.  The Limited Partners received distributions of $161,484 and $34,772 and the General Partners received distributions of $1,631 and $351 for the periods, respectively.  The Limited Partners’ distributions represented $7.13 and $1.53 per Unit for the periods, respectively.  The Partnership anticipates the remaining net sale proceeds will either be reinvested in additional property or distributed to the Partners in the future.

The Partnership may acquire Units from Limited Partners who have tendered their Units to the Partnership.  Such Units may be acquired at a discount.  The Partnership will not be obligated to purchase in any year more than 5% of the total number of Units outstanding on January 1 of such year.  In no event shall the Partnership be obligated to purchase Units if, in the sole discretion of the Managing General Partner, such purchase would impair the capital or operation of the Partnership.  During the six months ended June 30, 2014 and 2013, the Partnership did not redeem any Units from the Limited Partners.

The continuing rent payments from the properties, together with cash generated from property sales, should be adequate to fund continuing distributions and meet other Partnership obligations on both a short-term and long-term basis.

The Economy and Market Conditions

The impact of conditions in the economy over the last several years, including the turmoil in the credit markets, has adversely affected many real estate investment funds.  However, the absence of mortgage financing on the Partnership's properties eliminates the risks of foreclosure and debt-refinancing that can negatively impact the value and distributions of leveraged real estate investment funds.  Nevertheless, a prolonged economic downturn may adversely affect the operations of the Partnership's tenants and their cash flows.  If a tenant were to default on its lease obligations, the Partnership's income would decrease, its distributions would likely be reduced and the value of its properties might decline.

Off-Balance Sheet Arrangements

As of June 30, 2014 and December 31, 2013, the Partnership had no material off-balance sheet arrangements that had or are reasonably likely to have current or future effects on its financial condition, results of operations, liquidity or capital resources.

Page 19 of 22

ITEM 3.  QUANTITATIVE & QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not required for a smaller reporting company.

ITEM 4.  CONTROLS AND PROCEDURES.

(a)  Disclosure Controls and Procedures.

Under the supervision and with the participation of management, including its President and Chief Financial Officer, the Managing General Partner of the Partnership evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)).  Based upon that evaluation, the President and Chief Financial Officer of the Managing General Partner concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in applicable rules and forms and that such information is accumulated and communicated to management, including the President and Chief Financial Officer of the Managing General Partner, in a manner that allows timely decisions regarding required disclosure.

(b)  Changes in Internal Control Over Financial Reporting.

During the most recent period covered by this report, there has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

There are no material pending legal proceedings to which the Partnership is a party or of which the Partnership's property is subject.

ITEM 1A.  RISK FACTORS.

Not required for a smaller reporting company.

Page 20 of 22

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES & USE OF PROCEEDS.

(a) None.

(b) Not applicable.

(c) Pursuant to Section 7.7 of the Partnership Agreement, as amended, each Limited Partner has the right to present Units to the Partnership for purchase by submitting notice to the Managing General Partner during January or July of each year.  The purchase price of the Units is equal to 95% of the net asset value per Unit, as of the first business day of January or July of each year, as determined by the Managing General Partner in accordance with the provisions of the Partnership Agreement.  Units tendered to the Partnership during January and July are redeemed on April 1st and October 1st, respectively, of each year subject to the following limitations.  The Partnership will not be obligated to purchase in any year more than 5% of the total number of Units outstanding on January 1 of such year.  In no event shall the Partnership be obligated to purchase Units if, in the sole discretion of the Managing General Partner, such purchase would impair the capital or operation of the Partnership.  During the period covered by this report, the Partnership did not purchase any Units.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4.  MINE SAFETY DISCLOSURES.

Not Applicable.

ITEM 5.  OTHER INFORMATION.

None.

ITEM 6.  EXHIBITS.

31.1 Certification of Chief Executive Officer of General Partner pursuant to Rule 15d-14(a)(17 CFR 240.15d-14(a)) and Section 302 of the Sarbanes-Oxley Act of 2002.

31.2 Certification of Chief Financial Officer of General Partner pursuant to Rule 15d-14(a)(17 CFR 240.15d-14(a)) and Section 302 of the Sarbanes-Oxley Act of 2002.

32 Certification of Chief Executive Officer and Chief Financial Officer of General Partner pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Page 21 of 22

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated:  August 12, 2014	AEI Income & Growth Fund XXI
	Limited Partnership
	By:	AEI Fund Management XXI, Inc.
	Its:	Managing General Partner
	By:	/s/ ROBERT P JOHNSON
		Robert P. Johnson
		President
		(Principal Executive Officer)
	By:	/s/ PATRICK W KEENE
		Patrick W. Keene
		Chief Financial Officer
		(Principal Accounting Officer)

Page 22 of 22

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Robert P. Johnson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of AEI Income & Growth Fund XXI Limited Partnership;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)      Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)      Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)      Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)      Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)      All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)      Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  August 12, 2014	/s/ ROBERT P JOHNSON
	Robert P. Johnson, President
	AEI Fund Management XXI, Inc.
	Managing General Partner

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Patrick W. Keene, certify that:

1. I have reviewed this quarterly report on Form 10-Q of AEI Income & Growth Fund XXI Limited Partnership;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)      Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)      Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)      Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)      Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)      All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)      Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  August 12, 2014	/s/ PATRICK W KEENE
	Patrick W. Keene, Chief Financial Officer
	AEI Fund Management XXI, Inc.
	Managing General Partner

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO

18 U.S.C. §1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of AEI Income & Growth Fund XXI Limited Partnership (the “Partnership”) on Form 10-Q for the period ended June 30, 2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Robert P. Johnson, President of AEI Fund Management XXI, Inc., the Managing General Partner of the Partnership, and Patrick W. Keene, Chief Financial Officer of AEI Fund Management XXI, Inc., each certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

  /s/ ROBERT P JOHNSON

Robert P. Johnson, President

AEI Fund Management XXI, Inc.

Managing General Partner

August 12, 2014

  /s/ PATRICK W KEENE

Patrick W. Keene, Chief Financial Officer

AEI Fund Management XXI, Inc.

Managing General Partner

August 12, 2014

XML

Discontinued Operations (Details) - Discontinued Operations (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Discontinued Operations [Abstract]
Rental Income	$ 0	$ 99,211	$ 26,740	$ 198,423
Property Management Expenses	3,016	439	3,028	530
Depreciation	0	34,641	0	69,282
Income from Equity Method Investment Held for Sale	479,483	0	512,347	0
Income from Discontinued Operations	$ 476,467	$ 64,131	$ 536,059	$ 128,611

XML

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

(3) Summary of Significant Accounting Policies –

Real Estate

Upon acquisition of real properties, the Partnership records them in the financial statements at cost. The purchase price is allocated to tangible assets, consisting of land and building, and to identified intangible assets and liabilities, which may include the value of above market and below market leases and the value of in-place leases. The allocation of the purchase price is based upon the fair value of each component of the property. Although independent appraisals may be used to assist in the determination of fair value, in many cases these values will be based upon management’s assessment of each property, the selling prices of comparable properties and the discounted value of cash flows from the asset. 

The fair values of above market and below market in-place leases will be recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) an estimate of fair market lease rates for the corresponding in-place leases measured over a period equal to the non-cancelable term of the lease including any bargain renewal periods. The above market and below market lease values will be capitalized as intangible lease assets or liabilities. Above market lease values will be amortized as an adjustment of rental income over the remaining terms of the respective leases. Below market leases will be amortized as an adjustment of rental income over the remaining term of the respective leases, including any bargain renewal periods. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above market and below market in-place lease values relating to that lease would be recorded as an adjustment to rental income.

The fair values of in-place leases will include estimated direct costs associated with obtaining a new tenant, and opportunity costs associated with lost rentals which are avoided by acquiring an in-place lease. Direct costs associated with obtaining a new tenant may include commissions, tenant improvements, and other direct costs and are estimated, in part, by management’s consideration of current market costs to execute a similar lease. These direct costs will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases. The value of opportunity costs will be calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease. These intangibles will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed.

The Partnership tests real estate for recoverability when events or changes in circumstances indicate that the carrying value may not be recoverable.  For properties the Partnership will hold and operate, it compares the carrying amount of the property to the estimated probability-weighted future undiscounted cash flows expected to result from the property and its eventual disposition.  If the sum of the expected future cash flows is less than the carrying amount of the property, the Partnership recognizes an impairment loss by the amount by which the carrying amount of the property exceeds the fair value of the property.  For properties held for sale, the Partnership determines whether impairment has occurred by comparing the property’s estimated fair value less cost to sell to its current carrying value.  If the carrying value is greater than the net realizable value, an impairment loss is recorded to reduce the carrying value of the property to its net realizable value.

XML

Organization

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block]

(2) Organization –

AEI Income & Growth Fund XXI Limited Partnership (“Partnership”) was formed to acquire and lease commercial properties to operating tenants. The Partnership's operations are managed by AEI Fund Management XXI, Inc. (“AFM”), the Managing General Partner. Robert P. Johnson, the President and sole director of AFM, serves as the Individual General Partner. AFM is a wholly owned subsidiary of AEI Capital Corporation of which Mr. Johnson is the majority shareholder. AEI Fund Management, Inc. (“AEI”), an affiliate of AFM, performs the administrative and operating functions for the Partnership.

The terms of the Partnership offering called for a subscription price of $1,000 per Limited Partnership Unit, payable on acceptance of the offer. The Partnership commenced operations on April 14, 1995 when minimum subscriptions of 1,500 Limited Partnership Units ($1,500,000) were accepted. On January 31, 1997, the offering terminated when the maximum subscription limit of 24,000 Limited Partnership Units was reached. Under the terms of the Limited Partnership Agreement, the Limited Partners and General Partners contributed funds of $24,000,000 and $1,000, respectively.

During operations, any Net Cash Flow, as defined, which the General Partners determine to distribute will be distributed 90% to the Limited Partners and 10% to the General Partners; provided, however, that such distributions to the General Partners will be subordinated to the Limited Partners first receiving an annual, noncumulative distribution of Net Cash Flow equal to 10% of their Adjusted Capital Contribution, as defined, and, provided further, that in no event will the General Partners receive less than 1% of such Net Cash Flow per annum. Distributions to Limited Partners will be made pro rata by Units.

Any Net Proceeds of Sale, as defined, from the sale or financing of properties which the General Partners determine to distribute will, after provisions for debts and reserves, be paid in the following manner: (i) first, 99% to the Limited Partners and 1% to the General Partners until the Limited Partners receive an amount equal to: (a) their Adjusted Capital Contribution plus (b) an amount equal to 10% of their Adjusted Capital Contribution per annum, cumulative but not compounded, to the extent not previously distributed from Net Cash Flow; (ii) any remaining balance will be distributed 90% to the Limited Partners and 10% to the General Partners. Distributions to the Limited Partners will be made pro rata by Units.

For tax purposes, profits from operations, other than profits attributable to the sale, exchange, financing, refinancing or other disposition of property, will be allocated first in the same ratio in which, and to the extent, Net Cash Flow is distributed to the Partners for such year. Any additional profits will be allocated in the same ratio as the last dollar of Net Cash Flow is distributed. Net losses from operations will be allocated 99% to the Limited Partners and 1% to the General Partners.

For tax purposes, profits arising from the sale, financing, or other disposition of property will be allocated in accordance with the Partnership Agreement as follows: (i) first, to those partners with deficit balances in their capital accounts in an amount equal to the sum of such deficit balances; (ii) second, 99% to the Limited Partners and 1% to the General Partners until the aggregate balance in the Limited Partners' capital accounts equals the sum of the Limited Partners' Adjusted Capital Contributions plus an amount equal to 10% of their Adjusted Capital Contributions per annum, cumulative but not compounded, to the extent not previously allocated; (iii) third, the balance of any remaining gain will then be allocated 90% to the Limited Partners and 10% to the General Partners. Losses will be allocated 98% to the Limited Partners and 2% to the General Partners.

The General Partners are not required to currently fund a deficit capital balance. Upon liquidation of the Partnership or withdrawal by a General Partner, the General Partners will contribute to the Partnership an amount equal to the lesser of the deficit balances in their capital accounts or 1% of total Limited Partners' and General Partners' capital contributions.

In January 2014, the Managing General Partner mailed a Consent Statement (Proxy) seeking the consent of the Limited Partners to continue the Partnership for an additional 60 months or to initiate the final disposition, liquidation and distribution of all of the Partnership’s properties and assets. On February 14, 2014, the proposal to continue the Partnership was approved with a majority of Units voted in favor of the continuation proposal. As a result, the Managing General Partner will continue the operations of the Partnership for an additional 60 months at which time it will again ask the Limited Partners to vote on the same two proposals.

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Balance Sheet (USD $)	Jun. 30, 2014	Dec. 31, 2013
Current Assets:
Cash	$ 4,756,932	$ 5,553,960
Real Estate Held for Investment:
Land	3,566,183	2,866,183
Buildings and Equipment	10,216,447	8,809,264
Acquired Intangible Lease Assets	185,920	0
Real Estate Investments, at cost	13,968,550	11,675,447
Accumulated Depreciation and Amortization	2,716,676	2,533,686
Real Estate Held for Investment, Net	11,251,874	9,141,761
Real Estate Held for Sale	0	1,508,930
Equity Method Investment Held for Sale	433,446	0
Total Real Estate	11,685,320	10,650,691
Total Assets	16,442,252	16,204,651
Current Liabilities:
Payable to AEI Fund Management, Inc.	24,882	11,049
Distributions Payable	291,922	291,922
Unearned Rent	47,027	12,121
Total Current Liabilities	363,831	315,092
Long-term Liabilities:
Acquired Below-Market Lease Intangibles, Net	79,687	0
Partners’ Capital:
General Partners	12,296	11,205
Limited Partners – 24,000 Units authorized; 22,653 Units issued and outstanding	15,986,438	15,878,354
Total Partners' Capital	15,998,734	15,889,559
Total Liabilities and Partners' Capital	16,442,252	16,204,651
Limited Partner [Member]
Partners’ Capital:
Total Partners' Capital	$ 15,986,438	$ 15,878,354

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Statement of Changes in Partners' Capital (USD $)	General Partner [Member]	Limited Partner [Member]	Total
Balance at Dec. 31, 2012	$ 686	$ 15,658,370	$ 15,659,056
Balance (in Shares) at Dec. 31, 2012		22,653.11
Distributions Declared	5,878	582,000	587,878
Net Income	3,073	304,215	307,288
Balance at Jun. 30, 2013	(2,119)	15,380,585	15,378,466
Balance (in Shares) at Jun. 30, 2013		22,653.11
Balance at Dec. 31, 2013	11,205	15,878,354	15,889,559
Balance (in Shares) at Dec. 31, 2013		22,653
Distributions Declared	5,839	578,005	583,844
Net Income	6,930	686,089	693,019
Balance at Jun. 30, 2014	$ 12,296	$ 15,986,438	$ 15,998,734
Balance (in Shares) at Jun. 30, 2014		22,653

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Equity Method Investment Held for Sale (Details) (CM Lithia Springs DST)	Mar. 07, 2014
CM Lithia Springs DST
Equity Method Investment Held for Sale (Details) [Line Items]
Equity Method Investment, Ownership Percentage	20.00%

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Discontinued Operations (Details) (USD $)	6 Months Ended		0 Months Ended			6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Aug. 02, 2013 Scott White College Station TX	Aug. 23, 2013 Applebees Johnstown PA	Dec. 31, 2013 CarMax Auto Superstore Lithia Springs GA	Jun. 30, 2014 Limited Partner [Member]	Jun. 30, 2013 Limited Partner [Member]	Jun. 30, 2014 General Partner [Member]	Jun. 30, 2013 General Partner [Member]
Discontinued Operations (Details) [Line Items]
Significant Acquisitions and Disposals, Acquisition Costs or Sale Proceeds			$ 1,822,494	$ 1,958,905
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax			512,842	615,907
SEC Schedule III, Real Estate, Cost of Real Estate Sold			1,433,468	1,682,887
SEC Schedule III, Real Estate Accumulated Depreciation, Real Estate Sold			123,816	339,889
Real Estate Held-for-sale					1,508,930
Sale Proceeds Distribution Made To Member Or Limited Partner	$ 163,115	$ 35,123				$ 161,484	$ 34,772	$ 1,631	$ 351
Sale Proceeds Distribution Made to Limited Partner Per Unit (in Dollars per Item)						7.13	1.53

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Basis of Accounting

6 Months Ended

Jun. 30, 2014

Disclosure Text Block [Abstract]

Basis of Accounting [Text Block]

(1) The condensed statements included herein have been prepared by the registrant, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission, and reflect all adjustments which are, in the opinion of management, necessary to a fair statement of the results of operations for the interim period, on a basis consistent with the annual audited statements. The adjustments made to these condensed statements consist only of normal recurring adjustments. Certain information, accounting policies, and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the registrant believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these condensed financial statements be read in conjunction with the financial statements and the summary of significant accounting policies and notes thereto included in the registrant’s latest annual report on Form 10-K.

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Balance Sheet (Parentheticals)(Limited Partner [Member])	Jun. 30, 2014	Dec. 31, 2013
Limited Partners, units authorized	24,000	24,000
Limited Partners, units issued	22,653	22,653
Limited Partners, units outstanding	22,653	22,653

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Accounting Policies, by Policy (Policies)

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

Distribution Policy, Members or Limited Partners, Description

During operations, any Net Cash Flow, as defined, which the General Partners determine to distribute will be distributed 90% to the Limited Partners and 10% to the General Partners; provided, however, that such distributions to the General Partners will be subordinated to the Limited Partners first receiving an annual, noncumulative distribution of Net Cash Flow equal to 10% of their Adjusted Capital Contribution, as defined, and, provided further, that in no event will the General Partners receive less than 1% of such Net Cash Flow per annum. Distributions to Limited Partners will be made pro rata by Units.Any Net Proceeds of Sale, as defined, from the sale or financing of properties which the General Partners determine to distribute will, after provisions for debts and reserves, be paid in the following manner: (i) first, 99% to the Limited Partners and 1% to the General Partners until the Limited Partners receive an amount equal to: (a) their Adjusted Capital Contribution plus (b) an amount equal to 10% of their Adjusted Capital Contribution per annum, cumulative but not compounded, to the extent not previously distributed from Net Cash Flow; (ii) any remaining balance will be distributed 90% to the Limited Partners and 10% to the General Partners. Distributions to the Limited Partners will be made pro rata by Units.

Key Provisions of Operating or Partnership Agreement, Description

For tax purposes, profits from operations, other than profits attributable to the sale, exchange, financing, refinancing or other disposition of property, will be allocated first in the same ratio in which, and to the extent, Net Cash Flow is distributed to the Partners for such year. Any additional profits will be allocated in the same ratio as the last dollar of Net Cash Flow is distributed. Net losses from operations will be allocated 99% to the Limited Partners and 1% to the General Partners.For tax purposes, profits arising from the sale, financing, or other disposition of property will be allocated in accordance with the Partnership Agreement as follows: (i) first, to those partners with deficit balances in their capital accounts in an amount equal to the sum of such deficit balances; (ii) second, 99% to the Limited Partners and 1% to the General Partners until the aggregate balance in the Limited Partners' capital accounts equals the sum of the Limited Partners' Adjusted Capital Contributions plus an amount equal to 10% of their Adjusted Capital Contributions per annum, cumulative but not compounded, to the extent not previously allocated; (iii) third, the balance of any remaining gain will then be allocated 90% to the Limited Partners and 10% to the General Partners. Losses will be allocated 98% to the Limited Partners and 2% to the General Partners.The General Partners are not required to currently fund a deficit capital balance. Upon liquidation of the Partnership or withdrawal by a General Partner, the General Partners will contribute to the Partnership an amount equal to the lesser of the deficit balances in their capital accounts or 1% of total Limited Partners' and General Partners' capital contributions.

Property, Plant and Equipment, Policy [Policy Text Block]

Real Estate

Upon acquisition of real properties, the Partnership records them in the financial statements at cost. The purchase price is allocated to tangible assets, consisting of land and building, and to identified intangible assets and liabilities, which may include the value of above market and below market leases and the value of in-place leases. The allocation of the purchase price is based upon the fair value of each component of the property. Although independent appraisals may be used to assist in the determination of fair value, in many cases these values will be based upon management’s assessment of each property, the selling prices of comparable properties and the discounted value of cash flows from the asset. 

The fair values of above market and below market in-place leases will be recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) an estimate of fair market lease rates for the corresponding in-place leases measured over a period equal to the non-cancelable term of the lease including any bargain renewal periods. The above market and below market lease values will be capitalized as intangible lease assets or liabilities. Above market lease values will be amortized as an adjustment of rental income over the remaining terms of the respective leases. Below market leases will be amortized as an adjustment of rental income over the remaining term of the respective leases, including any bargain renewal periods. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above market and below market in-place lease values relating to that lease would be recorded as an adjustment to rental income.

The fair values of in-place leases will include estimated direct costs associated with obtaining a new tenant, and opportunity costs associated with lost rentals which are avoided by acquiring an in-place lease. Direct costs associated with obtaining a new tenant may include commissions, tenant improvements, and other direct costs and are estimated, in part, by management’s consideration of current market costs to execute a similar lease. These direct costs will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases. The value of opportunity costs will be calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease. These intangibles will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed.

The Partnership tests real estate for recoverability when events or changes in circumstances indicate that the carrying value may not be recoverable.  For properties the Partnership will hold and operate, it compares the carrying amount of the property to the estimated probability-weighted future undiscounted cash flows expected to result from the property and its eventual disposition.  If the sum of the expected future cash flows is less than the carrying amount of the property, the Partnership recognizes an impairment loss by the amount by which the carrying amount of the property exceeds the fair value of the property.  For properties held for sale, the Partnership determines whether impairment has occurred by comparing the property’s estimated fair value less cost to sell to its current carrying value.  If the carrying value is greater than the net realizable value, an impairment loss is recorded to reduce the carrying value of the property to its net realizable value

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Document And Entity Information (USD $)	6 Months Ended
	Jun. 30, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	AEI Income & Growth Fund XXI Ltd Partnership
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding	22,653
Entity Public Float	$ 0
Amendment Flag	false
Entity Central Index Key	0000931755
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Jun. 30, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2

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Equity Method Investment Held for Sale (Tables) (CM Lithia Springs DST)

6 Months Ended

Jun. 30, 2014

CM Lithia Springs DST

Equity Method Investment Held for Sale (Tables) [Line Items]

Equity Method Investments [Table Text Block]

Equity Method Investment Held for Sale

Real Estate Contributed	$	1,508,930
Cash Contributed		12,169
Net Income		512,347
Distributions Received		(1,600,000)
Equity Method Investment Held for Sale	$	433,446

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Statement of Income (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Rental Income	$ 257,674	$ 239,715	$ 499,411	$ 478,235
Expenses:
Partnership Administration – Affiliates	52,851	50,375	108,310	101,479
Partnership Administration and Property Management – Unrelated Parties	12,769	14,559	32,683	25,044
Property Acquisition	25,820	0	25,820	0
Depreciation and Amortization	94,897	88,093	182,990	176,186
Total Expenses	186,337	153,027	349,803	302,709
Operating Income	71,337	86,688	149,608	175,526
Other Income:
Interest Income	3,365	1,577	7,352	3,151
Income from Continuing Operations	74,702	88,265	156,960	178,677
Income from Discontinued Operations	476,467	64,131	536,059	128,611
Net Income	551,169	152,396	693,019	307,288
Net Income Allocated:
General Partners	5,511	1,524	6,930	3,073
Limited Partners	$ 545,658	$ 150,872	$ 686,089	$ 304,215
Income per Limited Partnership Unit:
Continuing Operations (in Dollars per share)	$ 3.26	$ 3.86	$ 6.86	$ 7.81
Discontinued Operations (in Dollars per share)	$ 20.83	$ 2.80	$ 23.43	$ 5.62
Total – Basic and Diluted (in Dollars per share)	$ 24.09	$ 6.66	$ 30.29	$ 13.43
Weighted Average Units Outstanding – Basic and Diluted (in Shares)	22,653	22,653	22,653	22,653

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Real Estate Held for Investment

6 Months Ended

Jun. 30, 2014

Real Estate [Abstract]

Real Estate Disclosure [Text Block]

(6) Real Estate Held for Investment –

On May 29, 2014, the Partnership purchased a 50% interest in a Tractor Supply Company store in Canton, Georgia for $2,212,500. The Partnership allocated $185,920 of the purchase price to Acquired Intangible Lease Assets, representing in-place lease intangibles and allocated $80,603 to Acquired Below-Market Lease Intangibles. The Partnership incurred $25,820 of acquisition expenses related to the purchase that were expensed. The property is leased to Tractor Supply Company under a Lease Agreement with a remaining primary term of 7.3 years (as of the date of purchase) and annual rent of $164,355 for the interest purchased. The remaining interest in the property was purchased by AEI Accredited Investor Fund V LP, an affiliate of the Partnership.

For the six months ended June 30, 2014 and 2013, the value of in-place lease intangibles amortized to expense was $2,113 and $0, respectively, and the increase to rental income for below-market leases was $916 and $0, respectively. For lease intangibles not held for sale at June 30, 2014, the weighted average remaining life is 87 months, the estimated amortization expense is $25,353 and the estimated increase to rental income is $10,991 for each of the next five succeeding years.

On July 3, 2014, the Partnership purchased a 30% interest in a Gander Mountain store in Champaign, Illinois for $2,122,500. The property is leased to Gander Mountain Company under a Lease Agreement with a remaining primary term of 14.9 years and annual rent of $167,772 for the interest purchased. The remaining interests in the property were purchased by AEI Accredited Investor Fund V LP and AEI National Income Property Fund VIII LP, affiliates of the Partnership.

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Reclassification

6 Months Ended

Jun. 30, 2014

Disclosure Text Block [Abstract]

Reclassifications [Text Block]

(5) Reclassification –

Certain items related to discontinued operations in the prior year’s financial statements have been reclassified to conform to 2014 presentation. These reclassifications had no effect on Partners’ capital, net income or cash flows.

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Equity Method Investment Held for Sale (Details) - Equity Method Investment Held for Sale (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Schedule of Equity Method Investments [Line Items]
Real Estate Contributed			$ 1,508,930	$ 0
Cash Contributed			12,169	0
Net Income	479,483	0	512,347	0
Equity Method Investment Held for Sale	433,446		433,446		0
CM Lithia Springs DST
Schedule of Equity Method Investments [Line Items]
Real Estate Contributed			1,508,930
Cash Contributed			12,169
Net Income			512,347
Distributions Received			(1,600,000)
Equity Method Investment Held for Sale	$ 433,446		$ 433,446

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Discontinued Operations (Tables)

6 Months Ended

Jun. 30, 2014

Discontinued Operations and Disposal Groups [Abstract]

Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures [Table Text Block]

Discontinued Operations

		Three Months Ended June 30				Six Months Ended June 30
		2014		2013		2014		2013
Rental Income	$	0	$	99,211	$	26,740	$	198,423
Property Management Expenses		3,016		439		3,028		530
Depreciation		0		34,641		0		69,282
Income from Equity Method Investment Held for Sale		479,483		0		512,347		0
Income from Discontinued Operations	$	476,467	$	64,131	$	536,059	$	128,611

Cash Flow, Supplemental Disclosures [Text Block]

Cash Flows from Discontinued Operations

		Three Months Ended June 30				Six Months Ended June 30
		2014		2013		2014		2013
Cash Flows from Discontinued Operations:
Operating Activities	$	(3,016)	$	98,772	$	23,712	$	197,893
Investing Activities	$	1,600,000	$	0	$	1,587,831	$	0

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Discontinued Operations

6 Months Ended

Jun. 30, 2014

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

(9) Discontinued Operations –

On August 2, 2013, the Partnership sold its 39% interest in the Scott & White Clinic in College Station, Texas to an unrelated third party. The Partnership received net sale proceeds of $1,822,494, which resulted in a net gain of $512,842. At the time of sale, the cost and related accumulated depreciation was $1,433,468 and $123,816, respectively.

In June 2013, the Partnership entered into an agreement to sell its 62% interest in the Applebee’s restaurant in Johnstown, Pennsylvania to an unrelated third party. On August 23, 2013, the sale closed with the Partnership receiving net sale proceeds of $1,958,905, which resulted in a net gain of $615,907. At the time of sale, the cost and related accumulated depreciation was $1,682,887 and $339,889, respectively.

In the fourth quarter of 2013, the Partnership decided to sell its 20% interest in the CarMax Auto Superstore in Lithia Springs, Georgia. On March 7, 2014, to facilitate the sale of the property, the Partnership contributed its interest in the property via a limited liability company to CM Lithia Springs DST as described in Note 7. At December 31, 2013, the property was classified as Real Estate Held for Sale with a carrying value of $1,508,930.

During the first six months of 2014 and 2013, the Partnership distributed net sale proceeds of $163,115 and $35,123, respectively. The Limited Partners received distributions of $161,484 and $34,772 and the General Partners received distributions of $1,631 and $351 for the periods, respectively. The Limited Partners’ distributions represented $7.13 and $1.53 per Unit for the periods, respectively.

The financial results for these properties are reflected as Discontinued Operations in the accompanying financial statements. The following are the results of discontinued operations:

		Three Months Ended June 30				Six Months Ended June 30
		2014		2013		2014		2013
Rental Income	$	0	$	99,211	$	26,740	$	198,423
Property Management Expenses		3,016		439		3,028		530
Depreciation		0		34,641		0		69,282
Income from Equity Method Investment Held for Sale		479,483		0		512,347		0
Income from Discontinued Operations	$	476,467	$	64,131	$	536,059	$	128,611

		Three Months Ended June 30				Six Months Ended June 30
		2014		2013		2014		2013
Cash Flows from Discontinued Operations:
Operating Activities	$	(3,016)	$	98,772	$	23,712	$	197,893
Investing Activities	$	1,600,000	$	0	$	1,587,831	$	0

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Equity Method Investment Held for Sale

6 Months Ended

Jun. 30, 2014

Policy Text Block [Abstract]

Equity Method Investments, Policy [Policy Text Block]

(7) Equity Method Investment Held for Sale –

In the fourth quarter of 2013, the Partnership decided to sell its 20% interest in the CarMax Auto Superstore in Lithia Springs, Georgia. The remaining interests in the property are owned by three affiliated entities, AEI Income & Growth Fund 24 LLC, AEI Income & Growth Fund 25 LLC and AEI Private Net Lease Millennium Fund Limited Partnership. On March 7, 2014, to facilitate the sale of the property, the Partnership and affiliated entities contributed their respective interests in the property via a limited liability company to CM Lithia Springs DST (“CMLS”), a Delaware statutory trust (“DST”), in exchange for Class B ownership interests in CMLS. In addition, a small amount of cash was contributed for working capital. A DST is a recognized mechanism for selling property to investors who are looking for replacement real estate to complete like-kind exchanges under Section 1031 of the Internal Revenue Code. As investors purchase Class A ownership interests in CMLS, the proceeds received will be used to redeem, on a one-for-one basis, the Class B ownership interests of the Partnership and affiliated entities.

The investment in CMLS is recorded using the equity method of accounting in the accompanying financial statements. Under the equity method, the investment in CMLS is stated at cost and adjusted for the Partnership’s share of net income or losses and reduced by distributions received by the Partnership. As of June 30, 2014, the investment balance consists of the following:

Real Estate Contributed	$	1,508,930
Cash Contributed		12,169
Net Income		512,347
Distributions Received		(1,600,000)
Equity Method Investment Held for Sale	$	433,446

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Payable to AEI Fund Management, Inc.

6 Months Ended

Jun. 30, 2014

Payables and Accruals [Abstract]

Accounts Payable and Accrued Liabilities Disclosure [Text Block]

(8) Payable to AEI Fund Management, Inc. –

AEI Fund Management, Inc. performs the administrative and operating functions for the Partnership. The payable to AEI Fund Management represents the balance due for those services. This balance is non-interest bearing and unsecured and is to be paid in the normal course of business.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2014

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

(10) Fair Value Measurements –

As of June 30, 2014 and December 31, 2013, the Partnership had no assets or liabilities measured at fair value on a recurring basis or nonrecurring basis.

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Real Estate Held for Investment (Details) (USD $)	0 Months Ended	12 Months Ended	0 Months Ended	6 Months Ended			6 Months Ended
	May 29, 2014 Tractor Supply Canton GA	May 29, 2015 Tractor Supply Canton GA	Jul. 03, 2014 Gander Mountain Champaign IL	Jun. 30, 2014 Leases, Acquired-in-Place [Member]	Jun. 30, 2013 Leases, Acquired-in-Place [Member]	May 30, 2015 Leases, Acquired-in-Place [Member]	Jun. 30, 2014 Off Market Unfavorable Lease Member	Jun. 30, 2013 Off Market Unfavorable Lease Member	May 30, 2015 Off Market Unfavorable Lease Member
Real Estate Held for Investment (Details) [Line Items]
Acquisitions and Disposals, Date of Transaction for Acquisition or Disposal	May 29, 2014		Jul. 03, 2014
Business Acquisition, Percentage of Voting Interests Acquired	50.00%		30.00%
Business Acquisition, Name of Acquired Entity	Tractor Supply Company		Gander Mountain
Significant Acquisitions and Disposals, Acquisition Costs or Sale Proceeds	$ 2,212,500		$ 2,122,500
Finite-Lived Intangible Asset, Acquired-in-Place Leases	185,920
Below Market Lease, Acquired	80,603
Business Acquisition, Transaction Costs	25,820
Average Lease Term	7.3		14.9
Real Estate Revenue, Net		164,355	167,772
Amortization of Intangible Assets				2,113	0
Amortization of above and below Market Leases							916	0
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months						$ 25,353			$ 10,991

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Discontinued Operations (Details) - Cash Flows from Discontinued Operations (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Cash Flows from Discontinued Operations:
Operating Activities	$ (3,016)	$ 98,772	$ 23,712	$ 197,893
Investing Activities	$ 1,600,000	$ 0	$ 1,587,831	$ 0

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Statement of Cash Flows (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Cash Flows from Operating Activities:
Net Income	$ 693,019	$ 307,288
Adjustments to Reconcile Net Income To Net Cash Provided by Operating Activities:
Depreciation and Amortization	182,074	245,468
Income from Equity Method Investment Held for Sale	512,347	0
Increase (Decrease) in Payable to AEI Fund Management, Inc.	13,833	(20,636)
Increase (Decrease) in Unearned Rent	34,906	9,090
Total Adjustments	(281,534)	233,922
Net Cash Provided By Operating Activities	411,485	541,210
Cash Flows from Investing Activities:
Investments in Real Estate	2,212,500	0
Cash Paid for Equity Method Investment Held for Sale	12,169	0
Distributions from Equity Method Investment Held for Sale	1,600,000	0
Net Cash Provided By (Used For) Investing Activities	(624,669)	0
Cash Flows from Financing Activities:
Distributions Paid to Partners	583,844	587,879
Net Increase (Decrease) in Cash	(797,028)	(46,669)
Cash, beginning of period	5,553,960	2,259,911
Cash, end of period	4,756,932	2,213,242
Supplemental Disclosure of Non-Cash Investing Activities:
Contribution of Real Estate in Exchange for Equity Method Investment	$ 1,508,930	$ 0

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Recently Adopted Accounting Standards

6 Months Ended

Jun. 30, 2014

Disclosure Text Block Supplement [Abstract]

Accounting Changes [Text Block]

(4) Recently Adopted Accounting Standards –

In April 2014, the FASB issued ASU No. 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360) Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” This topic amends the requirements for reporting discontinued operations. The disposal of a component must represent a strategic shift that will have a major effect on the Partnership’s operations and financial results in order to be reported as discontinued operations, and require certain additional interim and annual disclosures. The amendments in this ASU are effective for reporting periods beginning after December 15, 2014 with early adoption permitted. The Partnership has early adopted this standard effective January 1, 2014 and has applied the provisions prospectively. As a result, the Partnership anticipates that properties will not be considered discontinued operations when the properties are sold after January 1, 2014, with the exception of properties that were classified as Real Estate Held for Sale at December 31, 2013.

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Organization (Details) (USD $)	Jan. 31, 1997	Apr. 14, 1995
Accounting Policies [Abstract]
Capital Units, Value		$ 1,000
Limited Partners' Capital Account, Units Outstanding (in Shares)	24,000	1,500
Limited Partners' Contributed Capital	24,000,000	1,500,000
General Partners' Contributed Capital	$ 1,000