UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

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

For the quarterly period ended ~~June~~September 30, 2011

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

For the transition period from _________________ to _______________

Commission File Number 0-19022

Gateway Tax Credit Fund II Ltd.

(Exact name of Registrant as specified in its charter)

Florida		65-0142704
(State or other jurisdiction of incorporation or organization)		(IRS Employer No.)

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

Registrant’s Telephone Number, Including Area Code:

(727) 567-1000

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES [X]

NO [ ]

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

YES [X]

NO [ ]

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

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [ ]

No [X]

PART I - Financial Information

Item 1. Financial Statements

Balance of this page intentionally left blank.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

BALANCE SHEETS

(Unaudited)

	SERIES 2						SERIES 3						SERIES 4
	June 30,			March 31,			June 30,			March 31,			June 30,			March 31,
	September 30,			March 31,			September 30,			March 31,			September 30,			March 31,
	2011			2011			2011			2011			2011			2011
ASSETS
Current Assets:
Cash and Cash Equivalents	$	~~480~~66,~~552~~465		$	614,473		$	~~761~~73,~~817~~070		$	921,155		$	~~429~~421,~~699~~703		$	453,463
Total Assets	$	480,552		$	614,473		$	761,817		$	921,155		$	429,699		$	453,463
Receivable - Other		-			-			-			-			20,850			-
Total Assets	$	66,465		$	614,473		$	73,070		$	921,155		$	442,553		$	453,463
LIABILITIES AND PARTNERS' DEFICIT
Current Liabilities:
Payable to General Partners	$	1877,~~809~~218		$	3,398		$	17753,~~817~~626		$	19,502		$	~~997~~914,089		$	2,978
Distribution Payable		~~411,029~~-			540,593			~~682,464~~-			836,342			291,870			310,828
Total Current Liabilities		412,838			543,991			700,281			855,844			292,867			313,806
Deferred Gain on Sale of Project Partnerships		-			-			-			-			20,668			-
Payable - Other		5,703			-			5,192			-			-			-
Total Current Liabilities		882,921			543,991			758,818			855,844			1,226,627			313,806
Long-Term Liabilities:
Payable to General Partners		~~874,619~~-			874,619			~~737,017~~-			737,017			~~907,576~~-			904,255
Partners' Equity (Deficit):
Partners' (Deficit) Equity:
Limited Partner Assignees - 40,000 BAC's
authorized of which 6,136, 5,456, and 6,915
for Series 2, 3, and 4, respectively, have been
issued at June 30, 2011 and March 31, 2011		(951,351	)		(948,611	)		(683,764	)		(680,027	)		(778,096	)		(772,011	)
issued at September 30, 2011 and March 31, 2011		(960,817	)		(948,611	)		(693,929	)		(680,027	)		(791,292	)		(772,011	)
General Partners		144,~~446~~361			144,474			8,~~283~~181			8,321			7,~~352~~218			7,413
Total Partners' Deficit		(~~806~~816,~~905~~456	)		(804,137	)		(~~675~~685,~~481~~748	)		(671,706	)		(~~770~~784,~~744~~074	)		(764,598	)
Total Liabilities and Partners' Deficit	$	~~480~~66,~~552~~465		$	614,473		$	~~761~~73,~~817~~070		$	921,155		$	~~429~~442,~~699~~553		$	453,463

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

BALANCE SHEETS

(Unaudited)

	SERIES 5						SERIES 6						TOTAL SERIES 2 - 6
	June 30,			March 31,			June 30,			March 31,			June 30,			March 31,
	September 30,			March 31,			September 30,			March 31,			September 30,			March 31,
	2011			2011			2011			2011			2011			2011
ASSETS
Current Assets:
Cash and Cash Equivalents	$	1,~~139~~136,~~965~~604		$	1,247,249		$	~~602~~641,~~130~~500		$	569,140		$	32,~~414~~339,~~163~~342		$	3,805,480
Total Assets	$	1,139,965		$	1,247,249		$	602,130		$	569,140		$	3,414,163		$	3,805,480
Receivable - Other		104,150			-			-			-			125,000			-
Total Assets	$	1,240,754		$	1,247,249		$	641,500		$	569,140		$	2,464,342		$	3,805,480
LIABILITIES AND PARTNERS' DEFICIT
Current Liabilities:
Payable to General Partners	$	3970,~~197~~623		$	5,535		$	51,~~300~~386,556		$	7,877		$	294,~~120~~902,112		$	39,290
Distribution Payable		1,~~119~~128,~~367~~832			1,224,085			~~441~~493,~~630~~187			410,570			21,~~946~~913,~~360~~889			3,322,418
Total Current Liabilities		1,122,564			1,229,620			446,930			418,447			2,975,480			3,361,708
Deferred Gain on Sale of Project Partnerships		102,781			-			-			-			123,449			-
Payable - Other		-			-			-			-			10,895			-
Total Current Liabilities		2,202,236			1,229,620			1,879,743			418,447			6,950,345			3,361,708
Long-Term Liabilities:
Payable to General Partners		~~958,456~~-			951,064			~~1,365,372~~-			1,348,305			~~4,843,040~~-			4,815,260
Partners' Equity (Deficit):
Partners' (Deficit) Equity:
Limited Partner Assignees - 40,000 BAC's
authorized of which 8,616 and 10,105 for
Series 5 and 6, respectively, have been
issued at June 30, 2011 and March 31, 2011		(952,672	)		(945,128	)		(1,214,444	)		(1,201,691	)		(4,580,327	)		(4,547,468	)
issued at September 30, 2011 and March 31, 2011		(972,916	)		(945,128	)		(1,242,275	)		(1,201,691	)		(4,661,229	)		(4,547,468	)
General Partners		11,~~617~~434			11,693			4,~~272~~032			4,079			175,~~970~~226			175,980
Total Partners' Deficit		(~~941~~961,~~055~~482	)		(933,435	)		(1,~~210~~238,~~172~~243	)		(1,197,612	)		(4,~~404~~486,~~357~~003	)		(4,371,488	)
Total Liabilities and Partners' Deficit	$	1,~~139~~240,~~965~~754		$	1,247,249		$	~~602~~641,~~130~~500		$	569,140		$	32,~~414~~464,~~163~~342		$	3,805,480

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 2						SERIES 3						SERIES 4
	2011			2010			2011			2010			2011			2010
Revenues:
Distribution Income	$	~~750~~-		$	14,~~232~~250		$	-		$	-		$	1,~~470~~720		$	-4,486
Total Revenues		~~750~~-			14,~~232~~250			-			-			1,~~470~~720			-4,486
Expenses:
Asset Management Fee - General Partner		-			7,~~540~~541			-			9,~~360~~361			3,~~320~~321			5,~~384~~385
General and Administrative:
General Partner		-			97,~~813~~879			-			1211,~~266~~256			-			7,~~360~~307
Other		39,~~531~~564			28,~~000~~594			310,~~795~~288			21,~~559~~952			411,~~307~~743			26,~~674~~941
Total Expenses		39,~~531~~564			1924,~~353~~014			310,~~795~~288			2422,~~185~~569			715,~~627~~064			1519,~~418~~633
Loss Before Interest Income		(2,781	)		(18,121	)		(3,795	)		(24,185	)		(6,157	)		(15,418	)
Loss Before Gain on Sale of Project Partnerships
Interest Income		13			11			20			3			11			4
and Interest Income		(9,564	)		(19,764	)		(10,288	)		(22,569	)		(13,344	)		(15,147	)
Net Loss	$	(2,768	)	$	(18,110	)	$	(3,775	)	$	(24,182	)	$	(6,146	)	$	(15,414	)
Gain on Sale of Project Partnerships		1,000			86,699			-			19,875			-			-
Allocation of Net Loss:
Interest Income		13			17			21			4			14			6
Assignees	$	(2,740	)	$	(17,929	)	$	(3,737	)	$	(23,940	)	$	(6,085	)	$	(15,260	)
Net (Loss) Income	$	(8,551	)	$	66,952		$	(10,267	)	$	(2,690	)	$	(13,330	)	$	(15,141	)
General Partners		(28	)		(181	)		(38	)		(242	)		(61	)		(154	)
Allocation of Net (Loss) Income:
	$	(2,768	)	$	(18,110	)	$	(3,775	)	$	(24,182	)	$	(6,146	)	$	(15,414	)
Assignees	$	(8,466	)	$	66,283		$	(10,165	)	$	(3,612	)	$	(13,196	)	$	(14,989	)
Net Loss Per Beneficial
General Partners		(85	)		669			(102	)		922			(134	)		(152	)
Assignee Certificate	$	(0.45	)	$	(2.92	)	$	(0.68	)	$	(4.39	)	$	(0.88	)	$	(2.21	)
	$	(8,551	)	$	66,952		$	(10,267	)	$	(2,690	)	$	(13,330	)	$	(15,141	)
Net (Loss) Income Per Beneficial
Assignee Certificate	$	(1.38	)	$	10.80		$	(1.86	)	$	(0.66	)	$	(1.91	)	$	(2.17	)
Number of Beneficial Assignee
Certificates Outstanding		6,136			6,136			5,456			5,456			6,915			6,915

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 5						SERIES 6						TOTAL SERIES 2 - 6
	2011			2010			2011			2010			2011			2010
Revenues:
Distribution Income	$	~~5,024~~-		$	34,~~792~~106		$	93,~~979~~647		$	84,~~315~~594		$	175,~~223~~367		$	1317,~~339~~436
Total Revenues		~~5,024~~-			34,~~792~~106			93,~~979~~647			84,~~315~~594			175,~~223~~367			1317,~~339~~436
Expenses:
Asset Management Fee - General Partner		7,~~392~~391			1413,~~075~~547			1716,~~067~~194			20,232			2726,~~779~~906			56,~~591~~066
General and Administrative:
General Partner		-			-			-			2324,~~715~~957			-			5351,~~154~~399
Other		513,~~281~~072			212,~~034~~101			515,~~487~~543			213,~~615~~447			2260,~~401~~210			1143,~~882~~035
Total Expenses		1220,~~673~~463			1625,~~109~~648			2231,~~554~~737			4658,~~562~~636			5087,~~180~~116			~~121~~150,~~627~~500
Loss Before Gain on Sale of Project Partnerships
and Interest Income		(720,~~649~~463	)		(1221,~~317~~542	)		(1228,~~575~~090	)		(3854,~~247~~042	)		(3281,~~957~~749	)		(~~108~~133,~~288~~064	)
Gain on Sale of Project Partnerships		-9,465			~~216~~64,~~607~~356			3151,~~875~~557			-172,250			3162,~~875~~022			~~216~~343,~~607~~180
Interest Income		2936			1624			1519			69			88103			4060
Net (Loss) Income	$	(710,~~620~~962	)	$	~~204~~42,~~306~~838		$	1923,~~315~~486		$	~~(38~~118,~~241~~217	)	$	(~~994~~19,624	)	$	~~108~~210,~~359~~176
Allocation of Net (Loss) Income:
Assignees	$	(710,~~544~~853	)	$	~~202~~42,~~263~~409		$	1923,~~122~~251		$	~~(37~~116,~~859~~138	)	$	(~~984~~19,429	)	$	~~107~~206,~~275~~229
General Partners		(76109	)		~~2,043~~429			~~193~~235			~~(382~~2,079	)		(10195	)		13,~~084~~947
	$	(710,~~620~~962	)	$	~~204~~42,~~306~~838		$	1923,~~315~~486		$	~~(38~~118,~~241~~217	)	$	(~~994~~19,624	)	$	~~108~~210,~~359~~176
Net (Loss) Income Per Beneficial
Assignee Certificate	$	(01.8826	)	$	234.4892		$	12.8930		$	(311.7549	)
Number of Beneficial Assignee
Certificates Outstanding		8,616			8,616			10,105			10,105

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF OPERATIONS

FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 2						SERIES 3						SERIES 4
	2011			2010			2011			2010			2011			2010
Revenues:
Distribution Income	$	750		$	5,482		$	-		$	-		$	3,190		$	4,486
Total Revenues		750			5,482			-			-			3,190			4,486

Expenses:
Asset Management Fee - General Partner		-			15,081			-			18,721			6,641			10,769
General and Administrative:
General Partner		-			17,692			-			23,522			-			14,667
Other		13,095			10,594			14,083			4,511			16,050			9,615

Total Expenses		13,095			43,367			14,083			46,754			22,691			35,051

Loss Before Gain on Sale of Project Partnerships
and Interest Income		(12,345	)		(37,885	)		(14,083	)		(46,754	)		(19,501	)		(30,565	)
Gain on Sale of Project Partnerships		1,000			86,699			-			19,875			-			-
Interest Income		26			28			41			7			25			10

Net (Loss) Income	$	(11,319	)	$	48,842		$	(14,042	)	$	(26,872	)	$	(19,476	)	$	(30,555	)

Allocation of Net (Loss) Income:
Assignees	$	(11,206	)	$	48,354		$	(13,902	)	$	(27,551	)	$	(19,281	)	$	(30,249	)
General Partners		(113	)		488			(140	)		679			(195	)		(306	)

	$	(11,319	)	$	48,842		$	(14,042	)	$	(26,872	)	$	(19,476	)	$	(30,555	)
Net (Loss) Income Per Beneficial
Assignee Certificate	$	(1.83	)	$	7.88		$	(2.55	)	$	(5.05	)	$	(2.79	)	$	(4.37	)
Number of Beneficial Assignee
Certificates Outstanding		6,136			6,136			5,456			5,456			6,915			6,915

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF OPERATIONS

FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 5						SERIES 6						TOTAL SERIES 2 - 6
	2011			2010			2011			2010			2011			2010
Revenues:
Distribution Income	$	5,024		$	7,898		$	13,626		$	12,909		$	22,590		$	30,775
Total Revenues		5,024			7,898			13,626			12,909			22,590			30,775

Expenses:
Asset Management Fee - General Partner		14,783			27,622			33,261			40,464			54,685			112,657
General and Administrative:
General Partner		-			-			-			48,672			-			104,553
Other		18,353			14,135			21,030			16,062			82,611			54,917

Total Expenses		33,136			41,757			54,291			105,198			137,296			272,127

Loss Before Gain on Sale of Project Partnerships
and Interest Income		(28,112	)		(33,859	)		(40,665	)		(92,289	)		(114,706	)		(241,352	)
Gain on Sale of Project Partnerships		9,465			280,963			83,432			172,250			93,897			559,787
Interest Income		65			40			34			15			191			100

Net (Loss) Income	$	(18,582	)	$	247,144		$	42,801		$	79,976		$	(20,618	)	$	318,535

Allocation of Net (Loss) Income:
Assignees	$	(18,397	)	$	244,672		$	42,373		$	78,279		$	(20,413	)	$	313,505
General Partners		(185	)		2,472			428			1,697			(205	)		5,030

	$	(18,582	)	$	247,144		$	42,801		$	79,976		$	(20,618	)	$	318,535
Net (Loss) Income Per Beneficial
Assignee Certificate	$	(2.14	)	$	28.40		$	4.19		$	7.75
Number of Beneficial Assignee
Certificates Outstanding		8,616			8,616			10,105			10,105

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF PARTNERS’ EQUITY (DEFICIT)

FOR THE ~~THREE~~SIX MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 2									SERIES 3
				General									General
	Assignees			Partners			Total			Assignees			Partners			Total
Balance at March 31, 2010	$	(902,393	)	$	142,993		$	(759,400	)	$	(622,304	)	$	(490	)	$	(622,794	)
Net Loss		(17,929	)		(181	)		(18,110	)		(23,940	)		(242	)		(24,182	)
Net Income (Loss)		48,354			488			48,842			(27,551	)		679			(26,872	)
Balance at June 30, 2010	$	(920,322	)	$	142,812		$	(777,510	)	$	(646,244	)	$	(732	)	$	(646,976	)
Distributions		(86,699	)		-			(86,699	)		(19,875	)		-			(19,875	)
Balance at September 30, 2010	$	(940,738	)	$	143,481		$	(797,257	)	$	(669,730	)	$	189		$	(669,541	)
Balance at March 31, 2011	$	(948,611	)	$	144,474		$	(804,137	)	$	(680,027	)	$	8,321		$	(671,706	)
Net Loss		(211,~~740~~206	)		(28113	)		(211,~~768~~319	)		(313,~~737~~902	)		(38140	)		(314,~~775~~042	)
Balance at June 30, 2011	$	(951,351	)	$	144,446		$	(806,905	)	$	(683,764	)	$	8,283		$	(675,481	)
Distributions		(1,000	)		-			(1,000	)		-			-			-
Balance at September 30, 2011	$	(960,817	)	$	144,361		$	(816,456	)	$	(693,929	)	$	8,181		$	(685,748	)

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF PARTNERS’ EQUITY (DEFICIT)

FOR THE ~~THREE~~SIX MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 4									SERIES 5
				General									General
	Assignees			Partners			Total			Assignees			Partners			Total
Balance at March 31, 2010	$	(727,551	)	$	4,758		$	(722,793	)	$	(887,385	)	$	3,984		$	(883,401	)
Net (Loss) Income		(1530,~~260~~249	)		(~~154~~306	)		(1530,~~414~~555	)		~~202~~244,~~263~~672			2,~~043~~472			~~204~~247,~~306~~144
Distributions		-			-			-			(~~216~~280,~~607~~963	)		-			(~~216~~280,~~607~~963	)
Balance at June 30, 2010	$	(742,811	)	$	4,604		$	(738,207	)	$	(901,729	)	$	6,027		$	(895,702	)
Balance at September 30, 2010	$	(757,800	)	$	4,452		$	(753,348	)	$	(923,676	)	$	6,456		$	(917,220	)
Balance at March 31, 2011	$	(772,011	)	$	7,413		$	(764,598	)	$	(945,128	)	$	11,693		$	(933,435	)
Net Loss		(619,~~085~~281	)		(61195	)		(619,~~146~~476	)		(718,~~544~~397	)		(76185	)		(718,~~620~~582	)
Balance at June 30, 2011	$	(778,096	)	$	7,352		$	(770,744	)	$	(952,672	)	$	11,617		$	(941,055	)
Distributions		-			-			-			(9,391	)		(74	)		(9,465	)
Balance at September 30, 2011	$	(791,292	)	$	7,218		$	(784,074	)	$	(972,916	)	$	11,434		$	(961,482	)

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF PARTNERS’ EQUITY (DEFICIT)

FOR THE ~~THREE~~SIX MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 6									TOTAL SERIES 2 - 6
				General									General
	Assignees			Partners			Total			Assignees			Partners			Total
Balance at March 31, 2010	$	(1,076,356	)	$	16		$	(1,076,340	)	$	(4,215,989	)	$	151,261		$	(4,064,728	)
Net (Loss) Income		(37,859	)		(382	)		(38,241	)		107,275			1,084			108,359
Net Income		78,279			1,697			79,976			313,505			5,030			318,535
Distributions		-(172,250	)		-			-(172,250	)		(~~216~~559,~~607~~787	)		-			(~~216~~559,~~607~~787	)
Balance at June 30, 2010	$	(1,114,215	)	$	(366	)	$	(1,114,581	)	$	(4,325,321	)	$	152,345		$	(4,172,976	)
Balance at September 30, 2010	$	(1,170,327	)	$	1,713		$	(1,168,614	)	$	(4,462,271	)	$	156,291		$	(4,305,980	)
Balance at March 31, 2011	$	(1,201,691	)	$	4,079		$	(1,197,612	)	$	(4,547,468	)	$	175,980		$	(4,371,488	)
Net Income (Loss)		1942,~~122~~373			~~193~~428			1942,~~315~~801			(~~984~~20,413	)		(10205	)		(~~994~~20,618	)
Distributions		(3182,~~875~~957	)		-(475	)		(3183,~~875~~432	)		(3193,~~875~~348	)		-(549	)		(3193,~~875~~897	)
Balance at June 30, 2011	$	(1,214,444	)	$	4,272		$	(1,210,172	)	$	(4,580,327	)	$	175,970		$	(4,404,357	)
Balance at September 30, 2011	$	(1,242,275	)	$	4,032		$	(1,238,243	)	$	(4,661,229	)	$	175,226		$	(4,486,003	)

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE ~~THREE~~SIX MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 2						SERIES 3
	2011			2010			2011			2010
Cash Flows from Operating Activities:
Net Loss	$	(2,768	)	$	(18,110	)	$	(3,775	)	$	(24,182	)
Net (Loss) Income	$	(11,319	)	$	48,842		$	(14,042	)	$	(26,872	)
Adjustments to Reconcile Net Loss
Adjustments to Reconcile Net (Loss) Income
to Net Cash Used in Operating Activities:
Distribution Income		(750	)		(1,232	)		-			-
Gain on Sale of Project Partnerships		(1,000	)		(86,699	)		-			(19,875	)
Distribution Income		(750	)		(5,482	)		-			-
Changes in Operating Assets and Liabilities:
(Decrease) Increase in Payable to General Partners		(1,589	)		4,791			(1,685	)		19,342
Increase in Payable - Other		5,703			-			5,192			-
Net Cash Used in Operating Activities		(5,107	)		(14,551	)		(5,460	)		(4,840	)
(Decrease) Increase in Payable to General Partners		(799	)		12,213			(2,893	)		16,041
Net Cash Used in Operating Activities		(8,165	)		(31,126	)		(11,743	)		(30,706	)
Cash Flows from Investing Activities:
Distributions Received from Project Partnerships		750			15,~~232~~482			-			-
Net Cash Provided by Investing Activities		750			1,232			-			-
Net Proceeds from Sale of Project Partnerships		1,000			86,699			-			19,875
Net Cash Provided by Investing Activities		1,750			92,181			-			19,875
Cash Flows from Financing Activities:
Distributions		(~~129~~541,~~564~~593	)		-			(~~153~~836,~~878~~342	)		-
Net Cash Used in Financing Activities		(~~129~~541,~~564~~593	)		-			(~~153~~836,~~878~~342	)		-
Decrease in Cash and Cash Equivalents		(133,921	)		(13,319	)		(159,338	)		(4,840	)
(Decrease) Increase in Cash and Cash Equivalents		(548,008	)		61,055			(848,085	)		(10,831	)
Cash and Cash Equivalents at Beginning of Year		614,473			451,096			921,155			112,146
Cash and Cash Equivalents at End of Period	$	~~480~~66,~~552~~465		$	~~437~~512,~~777~~151		$	~~761~~73,~~817~~070		$	~~107~~101,~~306~~315
Supplemental disclosure of non-cash activities:
Increase in Distribution Payable	$	1,000		$	86,699		$	-		$	19,875
Distribution to Assignees		(1,000	)		(86,699	)		-			(19,875	)
Increase in Receivable - Other		-			5,000			-			719,207
Increase in Deferred Gain on Sale of Project Partnerships		-			(3,475	)		-			(711,852	)
Decrease in Payable to General Partners		-			(1,525	)		-			(7,355	)
	$	-		$	-		$	-		$	-

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE ~~THREE~~SIX MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 4						SERIES 5
	2011			2010			2011			2010
Cash Flows from Operating Activities:
Net (Loss) Income	$	(619,~~146~~476	)	$	(1530,~~414~~555	)	$	(718,~~620~~582	)	$	~~204~~247,~~306~~144
Adjustments to Reconcile Net (Loss) Income
to Net Cash Used in Operating Activities:
Gain on Sale of Project Partnerships		-			-			-(9,465	)		(~~216~~280,~~607~~963	)
Distribution Income		(13,~~470~~190	)		-(4,486	)		(5,024	)		(37,~~792~~898	)
Changes in Operating Assets and Liabilities:
Increase (Decrease) in Payable to General Partners		16,~~340~~674			25,~~086~~497			512,~~054~~655			(3216,~~391~~617	)
Net Cash Used in Operating Activities		(615,~~276~~992	)		(1329,~~328~~544	)		(720,~~590~~416	)		(4858,~~484~~334	)
Cash Flows from Investing Activities:
Distributions Received from Project Partnerships		13,~~470~~190			-4,486			5,024			37,~~792~~898
Net Proceeds from Sale of Project Partnerships		-			-			-9,465			~~217~~280,~~262~~963
Net Cash Provided by Investing Activities		13,~~470~~190			-4,486			514,~~024~~489			~~221~~288,~~054~~861
Cash Flows from Financing Activities:
Distributions		(18,958	)		-			(104,718	)		-
Net Cash Used in Financing Activities		(18,958	)		-			(104,718	)		-
(Decrease) Increase in Cash and Cash Equivalents		(2331,~~764~~760	)		(1325,~~328~~058	)		(~~107~~110,~~284~~645	)		~~172~~230,~~570~~527
Cash and Cash Equivalents at Beginning of Year		453,463			175,323			1,247,249			479,047
Cash and Cash Equivalents at End of Period	$	~~429~~421,~~699~~703		$	~~161~~150,~~995~~265		$	1,~~139~~136,~~965~~604		$	~~651~~709,~~617~~574
Supplemental disclosure of non-cash activities:
Increase in Distribution Payable	$	-		$	-		$	-9,465		$	~~216~~280,~~607~~963
Distribution to Assignees		-			-			-(9,465	)		(~~216~~280,~~607~~963	)
Increase in Receivable - Other		20,850			309,811			104,150			107,000
Increase in Deferred Gain on Sale of Project Partnerships		(20,668	)		(306,336	)		(102,781	)		(106,140	)
Decrease in Payable to General Partners		(182	)		(3,475	)		(1,369	)		(860	)
	$	-		$	-		$	-		$	-

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE ~~THREE~~SIX MONTHS ENDED ~~JUNE~~SEPTEMBER 30, 2011 AND 2010

(Unaudited)

	SERIES 6						TOTAL SERIES 2 - 6
	2011			2010			2011			2010
Cash Flows from Operating Activities:
Net Income (Loss)	$	1942,~~315~~801		$	~~(38~~79,~~241~~976	)	$	(~~994~~20,618	)	$	~~108~~318,~~359~~535
Adjustments to Reconcile Net Income (Loss)
to Net Cash Used in Operating Activities:
Gain on Sale of Project Partnerships		(3183,~~875~~432	)		-(172,250	)		(3193,~~875~~897	)		(~~216~~559,~~607~~787	)
Distribution Income		(913,~~979~~626	)		(812,~~315~~909	)		(1722,~~223~~590	)		(1330,~~339~~775	)
Changes in Operating Assets and Liabilities:
Increase (Decrease) in Payable to General Partners		14,490			(3,264	)		17,610			(9,436	)
Increase in Payable - Other		-			-			10,895			-
Net Cash Used in Operating Activities		(8,049	)		(49,820	)		(32,482	)		(131,023	)
Increase in Payable to General Partners		30,374			23,320			46,011			40,454
Net Cash Used in Operating Activities		(23,883	)		(81,863	)		(80,199	)		(231,573	)
Cash Flows from Investing Activities:
Distributions Received from Project Partnerships		913,~~979~~626			812,~~315~~909			1722,~~223~~590			1330,~~339~~775
Net Proceeds from Sale of Project Partnerships		3183,~~875~~432			-172,250			3193,~~875~~897			~~217~~559,~~262~~787
Net Cash Provided by Investing Activities		4197,~~854~~058			8185,~~315~~159			49116,~~098~~487			~~230~~590,~~601~~562
Cash Flows from Financing Activities:
Distributions		(815	)		-			(~~407~~1,~~933~~502,426	)		-
Net Cash Used in Financing Activities		(815	)		-			(~~407~~1,~~933~~502,426	)		-
Increase (Decrease) in Cash and Cash Equivalents		3272,~~990~~360			~~(41~~103,~~505~~296	)		(~~391~~1,~~317~~466,138	)		99358,~~578~~989
Cash and Cash Equivalents at Beginning of Year		569,140			229,672			3,805,480			1,447,284
Cash and Cash Equivalents at End of Period	$	~~602~~641,~~130~~500		$	~~188~~332,~~167~~968		$	32,~~414~~339,~~163~~342		$	1,~~546~~806,~~862~~273
Supplemental disclosure of non-cash activities:
Increase in Distribution Payable	$	3183,~~875~~432		$	-172,250		$	3193,~~875~~897		$	~~216~~559,~~607~~786
Distribution to Assignees		(3183,~~875~~432	)		-(172,250	)		(3193,~~875~~897	)		(~~216~~559,~~607~~786	)
Increase in Receivable - Other		-			~~64,000~~-			-125,000			641,~~000~~141,018
Increase in Deferred Gain on Sale of Project Partnerships		-			~~(63,037~~-	)		-(123,449	)		(631,~~037~~127,803	)
Decrease in Payable to General Partners		-			~~(963~~-	)		-(1,551	)		(~~963~~13,215	)
	$	-		$	-		$	-		$	-

See accompanying notes to financial statements.

GATEWAY TAX CREDIT FUND II LTD.

(A Florida Limited Partnership)

NOTES TO FINANCIAL STATEMENTS

~~JUNE~~SEPTEMBER 30, 2011

(Unaudited)

NOTE 1 - ORGANIZATION:

Gateway Tax Credit Fund II Ltd. (“Gateway”), a Florida Limited Partnership, was formed September 12, 1989, under the laws of Florida. Operations commenced on September 14, 1990 for Series 2, September 28, 1990 for Series 3, February 1, 1991 for Series 4, July 1, 1991 for Series 5 and January 1, 1992 for Series 6. Each Series has invested, as a limited partner, in other limited partnerships (“Project Partnerships”), each of which owns and operates one or more apartment complexes eligible for Low-Income Housing Tax Credits (“Tax Credits”), provided for in Section 42 of the Internal Revenue Code of 1986. Gateway will terminate on December 31, 2040 or sooner, in accordance with the terms of the limited partnership agreement (the “Agreement”). As of ~~June~~September 30, 2011, Gateway had received capital contributions of $195,410 from the General Partners and $37,228,000 from Beneficial Assignee Certificate investors (the “Assignees”). The fiscal year of Gateway for reporting purposes ends on March 31.

Pursuant to the Securities Act of 1933, Gateway filed a Form S-11 Registration Statement with the Securities and Exchange Commission, effective September 12, 1989, which covered the offering of Gateway’s Beneficial Assignee Certificates (“BACs”) representing assignments of units for the beneficial interest of the limited partnership interest of the Assignor Limited Partner. The Assignor Limited Partner was formed for the purpose of serving in that capacity for Gateway and will not engage in any other business.

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

Gateway offered BACs in five series. BACs in the amounts of $6,136,000, $5,456,000, $6,915,000, $8,616,000 and $10,105,000 for Series 2, 3, 4, 5 and 6, respectively, had been issued as of ~~June~~September 30, 2011. Each Series is treated as though it were a separate partnership, investing in a separate and distinct pool of Project Partnerships. Net proceeds from each Series are used to acquire Project Partnerships which are specifically allocated to such Series. Income or loss and all tax items from the Project Partnerships acquired by each Series are specifically allocated among the Assignees of such Series.

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

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:

Basis of Accounting

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

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

1)	Gateway’s capital contribution,

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

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

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Continued):

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

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

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

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

4)	Decreased, where appropriate, for impairment.

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

Since Gateway invests as a limited partner, and therefore is not obligated to fund losses or make additional capital contributions, it does not recognize losses from individual Project Partnerships to the extent that these losses would reduce the investment in those Project Partnerships below zero. The suspended losses will be used to offset future income from the individual Project Partnerships. Any cash distributions received from Project Partnerships which have a zero investment balance are accounted for as distribution income in the period the cash distribution is received by Gateway.

Gateway reviews its investments in Project Partnerships to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. If the sum of the expected remaining low-income housing tax credits and other tax benefits is less than the carrying amount of the investment, Gateway recognizes an impairment loss. As part of its analysis, Gateway has historically considered the residual value of the Project Partnerships as one key component of its estimate of future cash flows. Gateway is continuing to execute its process of disposition of its interest in Project Partnerships that have reached the end of their Tax Credit compliance period, refer to Note 5 - Summary of Disposition Activities for the most recent update of those on-going activities. No impairment expense was recognized during each of the ~~three~~six month periods ended ~~June~~September 30, 2011 or 2010.

Gateway, as a limited partner in the Project Partnerships, is subject to risks inherent in the ownership of property which are beyond its control, such as fluctuations in occupancy rates and operating expenses, variations in rental schedules, proper maintenance and continued eligibility for Tax Credits. If the cost of operating a property exceeds the rental income earned thereon, Gateway may deem it in its best interest to voluntarily provide funds in order to protect its investment. However, Gateway does not guarantee any of the mortgages or other debt of the Project Partnerships. No such funding to Project Partnerships occurred during each of the ~~three~~six month periods ended ~~June~~September 30, 2011 or 2010.

Cash and Cash Equivalents

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

~~Concentrations~~Concentration of Credit Risk

Financial instruments which potentially subject Gateway to concentrations of credit risk consist of cash investments in a money market mutual fund.

Use of Estimates in the Preparation of Financial Statements

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

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Continued):

Income Taxes

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

Distribution Payable

Distribution ~~payable~~Payable ~~consists~~represents ofnet ~~amounts~~proceeds ~~received~~from asthe ~~net~~sale ~~sales~~of ~~proceeds~~Project Partnership interests. These amounts, net of the applicable state tax withholding, are due and payable to the Assignees and will be distributed at such time that state tax withholding liabilities have been settled. See further discussion related to distribution payments in Note 5.

State Tax Withholding

Certain state tax jurisdictions impose a capital gains tax on the taxable gains associated with the sale of investments in partnerships. AsIt ~~General Partner of Gateway, it~~ is Gateway’s obligation to calculate and withhold the applicable state taxes that are payable by the Partners of Gateway when Project Partnerships are sold or otherwise disposed by Gateway. In most cases, the state taxes are due regardless if proceeds are received from the sale of Project Partnerships. Therefore, Gateway has estimated the withholding taxes payable and the amount is included in Distribution Payable on the Balance Sheet. State tax payments related to some of the sales of Project Partnerships were paid during the period ended ~~June~~September 30, 2011. See further discussion ofrelated ~~these~~to state tax payments in Note 5.

Variable Interest Entities

In June 2009, the FASB issued new consolidation guidance applicable to variable interest entities. Gateway adopted this new guidance as of April 1, 2010. The adoption of this new guidance had no impact on Gateway’s financial statements.

Generally, a variable interest entity, or VIE, is an entity with one or more of the following characteristics, (a) the total equity investment at risk is not sufficient to permit the entity to finance its activities without additional subordinated financial support; (b) as a group the holders of the equity investment at risk lack (i) the power to direct the activities of the entity that most significantly affect its economic performance, (ii) the obligation to absorb the expected losses or the right to receive the expected benefits of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. GAAP requires a VIE to be consolidated in the financial statements of the entity that is determined to be the primary beneficiary of the VIE. Determination of the primary beneficiary of each VIE requires judgment and is based on an analysis of control of the entity and economic factors. A VIE would be required to be consolidated if it has (1) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (2) the obligation to absorb losses or receive benefits that could possibly be significant to the VIE. In the design of Project Partnership VIEs, the overriding concept centers around the premise that the limited partner invests solely for tax attributes associated with the property held by the VIE, while the general partner of the Project Partnership is responsible for overseeing its operations. Based upon its analysis of all the relevant facts and considerations, Gateway has concluded that the general partner of the Project Partnership has the power to direct the activities of the Project Partnership that most significantly impact its economic performance, and the obligation to absorb losses or receive benefits that could be significant to the Project Partnership and therefore, Gateway is not the primary beneficiary.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Continued):

Gateway holds variable interests in 4232 VIEs, which consist of Project Partnerships (Refer to Note 1 - Organization for information about Gateway’s involvement in the Project Partnerships). Gateway is not the primary beneficiary of the VIEs. Since its inception, Gateway’s maximum exposure to loss as a result of its involvement with unconsolidated VIEs is limited to Gateway’s capital contributions to those VIEs, which is approximately $75,~~025~~559,~~332~~951 at ~~June~~September 30, 2011. Over the course of the investment and Tax Credit Cycle, this maximum exposure to loss was offset by actual losses experienced by the Project Partnerships recorded by Gateway in its equity accounting. Accordingly, at the current stage of the investment and Tax Credit Cycle, the carrying value of Gateway’s interest in the VIEs has been reduced to $0. Tabular disclosures within Note 4 - Investments in Project Partnerships detail total capital contributions to VIEs, the carrying amount of assets and liabilities related to Gateway’s VIEs and the aggregate assets, liabilities and Gateway’s exposure to loss from those VIEs. Gateway may be subject to additional losses to the extent of any financial support that Gateway voluntarily provides to those Project Partnerships in the future. Gateway does not currently intend to provide future financial support to the Project Partnerships.

Basis of Preparation

The unaudited financial statements presented herein have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles. These statements should be read in conjunction with the financial statements and notes thereto included with Gateway’s report on Form 10-K for the year ended March 31, 2011. In the opinion of management, these financial statements include adjustments, consisting only of normal recurring adjustments, necessary to fairly summarize Gateway’s financial position and results of operations. The results of operations for the periods may not be indicative of the results to be expected for the year.

NOTE 3 - RELATED PARTY TRANSACTIONS:

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

For the ~~three~~six months ended ~~June~~September 30, 2011 and 2010, the General Partners and affiliates are entitled to compensation and reimbursement for costs and expenses incurred by Gateway as follows:

Asset Management Fee - The Managing General Partner is entitled to receive an annual asset management fee equal to 0.25% of the aggregate cost of Gateway’s interest in the projects owned by the Project Partnerships. The asset management fee will be paid only after all other expenses of Gateway have been paid. These fees are included in the Statements of Operations.

	2011		2010
Series 2	$	-	$	715,~~540~~081
Series 3		-		918,~~360~~721
Series 4		36,~~320~~641		510,~~384~~769
Series 5		714,~~392~~783		1427,~~075~~622
Series 6		1733,~~067~~261		2040,~~232~~464
Total	$	2754,~~779~~685	$	56112,~~591~~657

General and Administrative Expenses - The Managing General Partner is reimbursed for general and administrative expenses of Gateway on an accountable basis. This expense is included in the Statements of Operations. During fiscal year 2011, the General Partner ceased further allocations of general and administrative expenses to Gateway.

	2011		2010
Series 2	$	-	$	917,~~813~~692
Series 3		-		1223,~~266~~522
Series 4		-		714,~~360~~667
Series 5		-		-
Series 6		-		2348,~~715~~672
Total	$	-	$	53104,~~154~~553

Refer to the discussion of net profit on re-syndication transactions contributed to Gateway by the Managing General Partner in Note 5, Summary of Disposition Activities herein.

NOTE 4 - INVESTMENTS IN PROJECT PARTNERSHIPS:

As of June 30, 2011, Gateway had acquired a 99% interest in the profits, losses, and Tax Credits as a limited partner in Project Partnerships (Series 4 - 6) which own and operate government assisted multi-family housing complexes. Cash flows from operations are allocated according to each Project Partnership agreement. Upon dissolution, proceeds will be distributed according to each Project Partnership agreement.
The following is a summary of Investments in Project Partnerships as of:
	SERIES 2				SERIES 3				SERIES 4
	June 30,		March 31,		June 30,		March 31,		June 30,			March 31,
	2011		2011		2011		2011		2011			2011
Capital Contributions to Project Partnerships
and purchase price paid for limited partner
interests in Project Partnerships	$	-	$	-	$	-	$	-	$	809,456		$	809,456
Cumulative equity in losses of Project
Partnerships (1)		-		-		-		-		(849,257	)		(849,257	)
Cumulative distributions received from
Project Partnerships		-		-		-		-		(29,665	)		(29,665	)
Investment in Project Partnerships before
Adjustment		-		-		-		-		(69,466	)		(69,466	)
Excess of investment cost over the underlying
assets acquired:
Acquisition fees and expenses		-		-		-		-		89,059			89,059
Accumulated amortization of acquisition
fees and expenses		-		-		-		-		(19,593	)		(19,593	)
Investments in Project Partnerships	$	-	$	-	$	-	$	-	$	-		$	-
(1) In accordance with Gateway's accounting policy to not carry investments in Project Partnerships below zero, cumulative suspended losses of $1,439,120 in Series 4 for the period ended June 30, 2011; and cumulative suspended losses of $1,423,462 in Series 4 for the year ended March 31, 2011 are not included.

As of September 30, 2011, Gateway had acquired a 99% interest in the profits, losses, and Tax Credits as a limited partner in Project Partnerships (Series 4 - 4 and Series 5 - 7) which own and operate government assisted multi-family housing complexes. Gateway has disposed of all interests held in Series 2 and 3. Cash flows from operations are allocated according to each Project Partnership agreement. Upon dissolution, proceeds will be distributed according to each Project Partnership agreement.

18The following is a summary of Investments in Project Partnerships as of:

	SERIES 4						SERIES 5
	September 30,			March 31,			September 30,			March 31,
	2011			2011			2011			2011
Capital Contributions to Project Partnerships
and purchase price paid for limited partner
interests in Project Partnerships	$	618,869		$	809,456		$	1,169,403		$	1,951,046

Cumulative equity in losses of Project
Partnerships (1)		(644,757	)		(849,257	)		(1,233,039	)		(1,978,250	)

Cumulative distributions received from
Project Partnerships		(25,705	)		(29,665	)		(28,121	)		(95,992	)

Investment in Project Partnerships before
Adjustment		(51,593	)		(69,466	)		(91,757	)		(123,196	)

Excess of investment cost over the underlying
assets acquired:
Acquisition fees and expenses		68,135			89,059			122,220			202,650
Accumulated amortization of acquisition
fees and expenses		(16,542	)		(19,593	)		(30,463	)		(79,454	)

Investments in Project Partnerships	$	-		$	-		$	-		$	-

(1) In accordance with Gateway's accounting policy to not carry investments in Project Partnerships below zero, cumulative suspended losses of $1,151,198 in Series 4 and $2,187,244 in Series 5 for the period ended September 30, 2011 and cumulative suspended losses of $1,423,462 in Series 4 and $2,626,278 in Series 5 for the year ended March 31, 2011 are not included.

NOTE 4 - INVESTMENTS IN PROJECT PARTNERSHIPS:

As of September 30, 2011, Gateway had acquired a 99% interest in the profits, losses, and Tax Credits as a limited partner in Project Partnerships (Series 6 - 21) which own and operate government assisted multi-family housing complexes. Gateway has disposed of all interests held in Series 2 and 3. Cash flows from operations are allocated according to each Project Partnership agreement. Upon dissolution, proceeds will be distributed according to each Project Partnership agreement.

The following is a summary of Investments in Project Partnerships as of:

	SERIES 6						TOTAL SERIES 2 - 6
	September 30,			March 31,			September 30,			March 31,
	2011			2011			2011			2011
Capital Contributions to Project Partnerships
and purchase price paid for limited partner
interests in Project Partnerships	$	3,771,679		$	4,532,944		$	5,559,951		$	7,293,446

Cumulative equity in losses of Project
Partnerships (1)		(3,881,494	)		(4,661,281	)		(5,759,290	)		(7,488,788	)

Cumulative distributions received from
Project Partnerships		(129,762	)		(152,419	)		(183,588	)		(278,076	)

Investment in Project Partnerships before
Adjustment		(239,577	)		(280,756	)		(382,927	)		(473,418	)

Excess of investment cost over the underlying
assets acquired:
Acquisition fees and expenses		400,960			455,613			591,315			747,322
Accumulated amortization of acquisition
fees and expenses		(138,544	)		(152,018	)		(185,549	)		(251,065	)

Reserve for Impairment of Investment in
Project Partnerships		(22,839	)		(22,839	)		(22,839	)		(22,839	)

Investments in Project Partnerships	$	-		$	-		$	-		$	-

(1) In accordance with Gateway's accounting policy to not carry investments in Project Partnerships below zero, cumulative suspended losses of $4,379,904 in Series 6 for the period ended September 30, 2011 and cumulative suspended losses of $5,068,051 in Series 6 for the year ended March 31, 2011 are not included.

NOTE 4 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

As of June 30, 2011, Gateway had acquired a 99% interest in the profits, losses, and Tax Credits as a limited partner in Project Partnerships (Series 5 - 12 and Series 6 - 24) which own and operate government assisted multi-family housing complexes. Cash flows from operations are allocated according to each Project Partnership agreement. Upon dissolution, proceeds will be distributed according to each Project Partnership agreement.
In accordance with Gateway's policy of presenting the financial information of the Project Partnerships on a three month lag, below are the summarized balance sheets for the Project Partnerships of Series 2 and Series 3 as of June 30 and the respective summarized statements of operations for the three months ended June 30 of each year. As of June 30, 2011, Gateway has disposed of all Project Partnership interests held in Series 2 and 3.
The following is a summary of Investments in Project Partnerships as of:
	SERIES 2						SERIES 3
	SERIES 5						SERIES 6						TOTAL SERIES 2 - 6
	2011			2010			2011			2010
	June 30,			March 31,			June 30,			March 31,			June 30,			March 31,
SUMMARIZED BALANCE SHEETS
	2011			2011			2011			2011			2011			2011
Assets:
Capital Contributions to Project Partnerships
Current assets	$	-		$	751,226		$	-		$	912,059
and purchase price paid for limited partner
Investment properties, net		-			3,595,897			-			2,301,901
interests in Project Partnerships	$	1,951,046		$	1,951,046		$	4,264,830		$	4,532,944		$	7,025,332		$	7,293,446
Other assets		-			18,210			-			20,541
Cumulative equity in losses of Project
Total assets	$	-		$	4,365,333		$	-		$	3,234,501
Partnerships (1)		(1,978,250	)		(1,978,250	)		(4,396,941	)		(4,661,281	)		(7,224,448	)		(7,488,788	)
Liabilities and Partners' Deficit:
Cumulative distributions received from
Current liabilities	$	-		$	228,646		$	-		$	167,563
Project Partnerships		(95,992	)		(95,992	)		(147,621	)		(152,419	)		(273,278	)		(278,076	)
Long-term debt		-			5,987,190			-			5,550,575
Investment in Project Partnerships before
Total liabilities		-			6,215,836			-			5,718,138
Adjustment		(123,196	)		(123,196	)		(279,732	)		(280,756	)		(472,394	)		(473,418	)
Partners' deficit
Excess of investment cost over the underlying
Limited Partner		-			(1,624,819	)		-			(2,356,282	)
assets acquired:
General Partners		-			(225,684	)		-			(127,355	)
Acquisition fees and expenses		202,650			202,650			454,210			455,613			745,919			747,322
Total partners' deficit		-			(1,850,503	)		-			(2,483,637	)
Accumulated amortization of acquisition
Total liabilities and partners' deficit	$	-		$	4,365,333		$	-		$	3,234,501
fees and expenses		(79,454	)		(79,454	)		(151,639	)		(152,018	)		(250,686	)		(251,065	)
SUMMARIZED STATEMENTS OF OPERATIONS
Reserve for Impairment of Investment in
Rental and other income	$	-		$	469,866		$	-		$	522,997
Project Partnerships		-			-			(22,839	)		(22,839	)		(22,839	)		(22,839	)
Expenses:
Investments in Project Partnerships	$	-		$	-		$	-		$	-		$	-		$	-
Operating expenses		-			361,549			-			394,605
(1) In accordance with Gateway's accounting policy to not carry investments in Project Partnerships below zero, cumulative suspended losses of $2,702,272 in Series 5 and $5,005,842 in Series 6 for the period ended June 30, 2011; and cumulative suspended losses of $2,626,278 in Series 5 and $5,068,051 in Series 6 for the year ended March 31, 2011 are not included.
Interest expense		-			63,065			-			46,239
Depreciation and amortization		-			111,798			-			149,644
Total expenses		-			536,412			-			590,488
Net loss	$	-		$	(66,546	)	$	-		$	(67,491	)
Other partners' share of net loss	$	-		$	(665	)	$	-		$	(675	)
Gateway's share of net loss	$	-		$	(65,881	)	$	-		$	(66,816	)
Suspended losses		-			65,881			-			66,816
Equity in Loss of Project Partnerships	$	-		$	-		$	-		$	-

NOTE 4 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

In accordance with Gateway's policy of presenting the financial information of the Project Partnerships on a three month lag, below are the summarized balance sheets for the Project Partnerships of Series 2 and Series 3 as of March 31 and the respective summarized statements of operations for the three months ended March 31 of each year:
In accordance with Gateway's policy of presenting the financial information of the Project Partnerships on a three month lag, below are the summarized balance sheets for the Project Partnerships of Series 4 and Series 5 as of June 30 and the respective summarized statements of operations for the three months ended June 30 of each year:
	SERIES 2						SERIES 3
	SERIES 4						SERIES 5
	2011			2010			2011			2010
SUMMARIZED BALANCE SHEETS
Assets:
Current assets	$	-648,739		$	1626,~~065,906~~782		$	-1,098,476		$	1,~~646~~904,~~042~~091
Investment properties, net		-2,316,682			52,~~469~~416,~~859~~505			-3,875,659			47,~~268~~006,~~254~~327
Other assets		-6,177			1810,~~210~~733			-5,358			5319,~~646~~538
Total assets	$	-2,971,598		$	63,~~553~~054,~~975~~020		$	-4,979,493		$	58,~~967~~929,~~942~~956
Liabilities and Partners' Deficit:
Current liabilities	$	-153,558		$	~~433~~159,~~005~~888		$	-149,640		$	~~305~~292,~~695~~390
Long-term debt		-4,490,516			104,~~024~~525,~~081~~961			-7,882,787			1213,~~502~~341,~~110~~835
Total liabilities		-4,644,074			104,~~457~~685,~~086~~849			-8,032,427			1213,~~807~~634,~~805~~225
Partners' equity (deficit)
Partners' deficit
Limited Partner		-(1,540,347	)		(31,~~615~~520,~~386~~858	)		-(2,824,917	)		(74,~~019~~638,~~443~~520	)
General Partners		-(132,129	)		(~~287~~110,~~725~~971	)		-(228,017	)		~~179~~(65,~~580~~749	)
Total partners' deficit		-(1,672,476	)		(31,~~903~~631,~~111~~829	)		-(3,052,934	)		(64,~~839~~704,~~863~~269	)
Total liabilities and partners' deficit	$	-2,971,598		$	63,~~553~~054,~~975~~020		$	-4,979,493		$	58,~~967~~929,~~942~~956
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income	$	-361,581		$	~~406~~363,~~856~~348		$	-665,324		$	~~535~~1,~~533~~110,848
Expenses:
Operating expenses		-273,296			~~324~~268,~~295~~865			-526,351			~~452~~895,~~885~~272
Interest expense		-45,536			5249,~~726~~473			-83,900			57141,~~037~~587
Depreciation and amortization		-96,071			9794,~~985~~665			-190,902			~~162~~286,~~977~~912
Total expenses		-414,903			~~475~~413,~~006~~003			-801,153			~~672~~1,~~899~~323,771
Net loss	$	-(53,322	)	$	(6849,~~150~~655	)	$	-(135,829	)	$	(~~137~~212,~~366~~923	)
Other partners' share of net loss	$	-(1,909	)	$	(~~681~~1,505	)	$	-(1,359	)	$	(12,~~374~~129	)
Gateway's share of net loss	$	-(51,413	)	$	(6748,~~469~~150	)	$	-(134,470	)	$	(~~135~~210,~~992~~794	)
Suspended losses		-51,413			6748,~~469~~150			-134,470			~~135~~210,~~992~~794
Equity in Loss of Project Partnerships	$	-		$	-		$	-		$	-

NOTE 4 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

In accordance with Gateway's policy of presenting the financial information of the Project Partnerships on a three month lag, below are the summarized balance sheets for the Project Partnerships of Series 4 and Series 5 as of March 31 and the respective summarized statements of operations for the three months ended March 31 of each year:

In accordance with Gateway's policy of presenting the financial information of the Project Partnerships on a three month lag, below are the summarized balance sheets for the Project Partnerships of Series 6 and Total Series 2 - 6 as of June 30 and the respective summarized statements of operations for the three months ended June 30 of each year:

SERIES 4

SERIES 5

SERIES 6

TOTAL SERIES 2 - 6

2011

2010

2011

2010

SUMMARIZED BALANCE SHEETS

Assets:

Current assets

~~662~~3,~~754~~282,565

13,~~086~~449,~~196~~995

15,~~382~~029,~~191~~780

27,~~431~~644,~~164~~153

Investment properties, net

212,~~364~~845,~~718~~332

315,~~583~~327,~~735~~629

519,~~557~~037,~~869~~673

930,~~903~~648,~~582~~259

Other assets

816,~~489~~223

1921,~~133~~460

627,~~511~~758

2990,~~614~~482

Total assets

316,~~035~~144,~~961~~120

418,~~689~~799,~~064~~084

624,~~946~~095,~~571~~211

1238,~~364~~382,~~360~~894

Liabilities and Partners' Deficit:

Current liabilities

~~177~~632,~~219~~175

~~222~~614,~~299~~331

~~202~~935,~~042~~373

~~580~~1,~~589~~462,818

Long-term debt

421,~~493~~536,~~960~~417

724,~~246~~802,~~783~~088

933,~~862~~909,~~602~~720

1854,~~858~~207,~~682~~649

Total liabilities

422,~~671~~168,~~179~~592

725,~~469~~416,~~082~~419

1034,~~064~~845,~~644~~093

1955,~~439~~670,~~271~~467

Partners' equity (deficit)

Partners' deficit

Limited Partner

(15,~~504~~486,~~592~~850

)

(26,~~903~~047,~~037~~108

)

(29,~~856~~852,~~680~~114

)

(616,~~913~~187,~~300~~587

)

General Partners

(~~130~~537,~~626~~622

)

~~123~~(570,~~019~~227

)

(~~261~~897,~~393~~768

)

(~~161~~1,~~611~~099,986

)

Total partners' deficit

(16,~~635~~024,~~218~~472

)

(26,~~780~~617,~~018~~335

)

(310,~~118~~749,~~073~~882

)

(717,~~074~~287,~~911~~573

)

Total liabilities and partners' deficit

316,~~035~~144,~~961~~120

418,~~689~~799,~~064~~084

624,~~946~~095,~~571~~211

1238,~~364~~382,~~360~~894

SUMMARIZED STATEMENTS OF OPERATIONS

Rental and other income

~~182~~1,~~625~~794,770

~~311~~2,~~623~~001,005

~~415~~2,~~150~~821,675

~~797~~4,~~779~~468,064

Expenses:

Operating expenses

~~127~~1,~~886~~291,509

~~236~~1,~~642~~473,899

~~328~~2,~~456~~091,156

~~620~~3,~~734~~394,190

Interest expense

22205,~~768~~836

39243,~~123~~965

53335,~~260~~272

99544,~~497~~329

Depreciation and amortization

48445,~~035~~172

80495,~~042~~594

~~110~~732,~~196~~145

~~200~~1,~~811~~138,613

Total expenses

~~198~~1,~~689~~942,517

~~355~~2,~~807~~213,458

~~491~~3,~~912~~158,573

~~921~~5,~~042~~077,132

Net loss

(16147,~~064~~747

)

(44212,~~184~~453

)

(76336,~~762~~898

)

(~~123~~609,~~263~~068

)

Other partners' share of net loss

(~~406~~2,122

)

(~~683~~2,873

)

(~~767~~5,390

)

(17,~~232~~847

)

Gateway's share of net loss

(15145,~~658~~625

)

(43209,~~501~~580

)

(75331,~~995~~508

)

(~~122~~601,~~031~~221

)

Suspended losses

15145,~~658~~625

43209,~~501~~580

75331,~~995~~508

~~122~~601,~~031~~221

Equity in Loss of Project Partnerships

NOTE 4 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

In accordance with Gateway's policy of presenting the financial information of the Project Partnerships on a three month lag, below are the summarized balance sheets for the Project Partnerships of Series 6 and Total Series 2 - 6 as of March 31 and the respective summarized statements of operations for the three months ended March 31 of each year:
	SERIES 6						TOTAL SERIES 2 - 6
	2011			2010			2011			2010
SUMMARIZED BALANCE SHEETS
Assets:
Current assets	$	3,151,908		$	3,786,506		$	5,196,853		$	10,015,814
Investment properties, net		13,060,708			17,015,007			20,983,295			40,240,437
Other assets		13,924			28,098			28,924			148,701
Total assets	$	16,226,540		$	20,829,611		$	26,209,072		$	50,404,952
Liabilities and Partners' Deficit:
Current liabilities	$	629,426		$	724,062		$	1,008,687		$	2,265,650
Long-term debt		21,536,417			27,019,788			35,892,979			75,651,444
Total liabilities		22,165,843			27,743,850			36,901,666			77,917,094
Partners' deficit
Limited Partner		(5,402,675	)		(6,299,588	)		(9,763,947	)		(26,750,754	)
General Partners		(536,628	)		(614,651	)		(928,647	)		(761,388	)
Total partners' deficit		(5,939,303	)		(6,914,239	)		(10,692,594	)		(27,512,142	)
Total liabilities and partners' deficit	$	16,226,540		$	20,829,611		$	26,209,072		$	50,404,952
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income	$	901,070		$	1,077,254		$	1,498,845		$	3,129,045
Expenses:
Operating expenses		638,895			771,511			1,095,237			2,406,067
Interest expense		102,168			132,234			178,196			380,617
Depreciation and amortization		222,585			266,497			380,816			808,312
Total expenses		963,648			1,170,242			1,654,249			3,594,996
Net loss	$	(62,578	)	$	(92,988	)	$	(155,404	)	$	(465,951	)
Other partners' share of net loss	$	2,346		$	(1,261	)	$	1,173		$	(5,231	)
Gateway's share of net loss	$	(64,924	)	$	(91,727	)	$	(156,577	)	$	(460,720	)
Suspended losses		64,924			91,727			156,577			460,720
Equity in Loss of Project Partnerships	$	-		$	-		$	-		$	-

NOTE 4 - INVESTMENTS IN PROJECT PARTNERSHIPS (Continued):

The aggregate assets, liabilities and exposure to loss from the VIEs in which Gateway holds a variable interest, but has concluded that it is not the primary beneficiary, are provided in the table below (refer to Note 2 for discussion of variable interest entities).

March 31, 2011

March 31, 2010

June 30, 2011

June 30, 2010

Aggregate Assets

Aggregate Liabilities

Our Risk Of Loss

Aggregate Assets

Aggregate Liabilities

Our Risk Of Loss

Series 2

64,~~553~~365,~~975~~333

106,~~457~~215,~~086~~836

Series 3

53,~~967~~234,~~942~~501

125,~~807~~718,~~805~~138

Series 4

32,~~035~~971,~~961~~598

4,~~671~~644,~~179~~074

43,~~689~~054,~~064~~020

74,~~469~~685,~~082~~849

Series 5

64,~~946~~979,~~571~~493

108,~~064~~032,~~644~~427

128,~~364~~929,~~360~~956

1913,~~439~~634,~~271~~225

Series 6

16,~~226~~144,~~540~~120

22,~~165~~168,~~843~~592

2018,~~829~~799,~~611~~084

2725,~~743~~416,~~850~~419

Total

2624,~~209~~095,~~072~~211

3634,~~901~~845,~~666~~093

5038,~~404~~382,~~952~~894

7755,~~917~~670,~~094~~467

NOTE 5 - SUMMARY OF DISPOSITION ACTIVITIES:

Gateway at one time held investments in 148 Project Partnerships (22 in Series 2, 23 in Series 3, 29 in Series 4, 36 in Series 5, and 38 in Series 6). As of ~~June~~September 30, 2011, Gateway has sold or otherwise disposed of its interest in ~~106~~116 Project Partnerships (22 in Series 2, 23 in Series 3, 2325 in Series 4, 2429 in Series 5 and 1417 in Series 6). A summary of the sale or disposition transactions for the Project Partnerships disposed during the current fiscal year-to-date and the previous fiscal year are summarized herein.:

Distribution Payable

~~The~~ Distribution Payable represents net proceeds from the sale of Project Partnership interests. Certain state tax jurisdictions impose a capital gains tax on the taxable gains associated with the sale of investments in partnerships. Gateway is obligated to calculate and withhold the applicable state taxes that are payable by the Partners of Gateway when Project Partnerships are sold or otherwise disposed by Gateway. In most cases, the state taxes are due regardless if proceeds are received from the sale of Project Partnerships. Therefore, Gateway has estimated the withholding taxes payable and the amount is included in Distribution Payable on the Balance Sheet. State withholding taxes paid during the period ended ~~June~~September 30, 2011 totaled $~~407~~421,~~933~~753 ($129,564 for Series 2, $~~153~~167,~~878~~698 for Series 3, $18,958 for Series 4, $104,718 for Series 5 and $815 for Series 6). These payments reduce the amount available to pay as distributions. Remaining net proceeds will be distributed to the Assignees in a subsequent period at such time that further state withholding tax liabilities have been settled. AsDuring ofthe ~~June~~period ended September 30, 2011, ~~the state withholding tax liabilities for the Series 2 and 3 have been paid.~~ Gateway ~~will~~distributed ~~distribute~~ the remaining net proceeds from the sale of the Project Partnership interests in Series 2 and 3 ~~in a subsequent quarter~~.

Fiscal Year 2012 Disposition Activity:

Series 62

Transaction		Net		Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	~~Net~~ Proceeds		Per BAC		on Disposal
April 2011	Dawson Elderly	$	31,875	$	3.15	$	31,875
September 2011	Other, net (see below)	$	-	$	-	$	1,000
						$	311,~~875~~000

~~The~~Gateway ~~net~~recognized ~~proceeds~~an ~~per~~additional ~~BAC~~gain ~~from~~on ~~the~~ sale of ~~Dawson~~Project ~~Elderly~~Partnerships ~~are~~in athe ~~component~~amount of ~~the~~$1,000 ~~Distribution~~resulting ~~Payable~~from on the ~~Balance~~true-up ~~Sheet~~of ascertain oflegal ~~June~~and ~~30,~~other ~~2011. These~~sale ~~net~~transaction ~~proceeds,~~closing ~~less~~expenses ~~the~~arising ~~applicable~~from ~~state~~a ~~tax~~Project ~~withholding,~~Partnership ~~will~~sale betransaction ~~distributed~~which toclosed in the ~~Series~~prior 6fiscal ~~Assignees~~year. This inamount awas ~~subsequent~~included ~~period~~in atthe ~~such~~distribution ~~time~~to ~~that~~Series ~~state~~2 ~~withholding~~Assignees ~~tax~~during ~~liabilities~~the ~~have~~period ~~been~~ended ~~settled~~September 30, 2011.

NOTE 5 - SUMMARY OF DISPOSITION ACTIVITIES (Continued):

Series 4

Transaction		Net		Net Proceeds		Gain (Loss)		Deferred Gain
Month / Year	Project Partnership	Proceeds		Per BAC		on Disposal		on Disposal
September 2011	SF Apartments of Arkansas City	$	1,909	$	0.28	$	-	$	1,909
September 2011	Wellsville Senior Housing		18,759		2.71		-		18,759
						$	-	$	20,668

In accordance with GAAP, although the sales of SF Apartments of Arkansas City and Wellsville Senior Housing were consummated on or prior to September 30, 2011, the gain on the sales is being deferred on the Balance Sheet and not recognized on the Statement of Operations until the period that the net sales proceeds are received. Gateway recorded a receivable for the gross proceeds from these sales totaling $20,850 which is included in Receivable - Other on the Balance Sheet and has been subsequently received in October 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 4 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled. The deferred gain of $20,668 will be recognized on the fiscal year 2012 third quarter Statement of Operations.

Series 5

Transaction		Net		Net Proceeds		Gain (Loss)		Deferred Gain
Month / Year	Project Partnership	Proceeds		Per BAC		on Disposal		on Disposal
August 2011	Yorkshire Retirement Village	$	7,465	$	0.87	$	7,465	$	-
September 2011	SF Apartments of Concordia		42,259		4.90		-		42,259
September 2011	SF Apartments of Medicine Lodge		20,212		2.35		-		20,212
September 2011	SF Apartments of Ottawa II		31,927		3.71		-		31,927
September 2011	SF Apartments of Winfield		8,383		0.97		-		8,383
September 2011	Other, net (see below)		-		-		2,000		-
						$	9,465	$	102,781

The net proceeds per BAC from the sale of Yorkshire Retirement Village are a component of the Distribution Payable on the Balance Sheet as of September 30, 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 5 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

In accordance with GAAP, although the sales of SF Apartments of Concordia, SF Apartments of Medicine Lodge, SF Apartments of Ottawa II and SF Apartments of Winfield were consummated on or prior to September 30, 2011, the gain on the sales is being deferred on the Balance Sheet and not recognized on the Statement of Operations until the period that the net sales proceeds are received. Gateway recorded a receivable for the gross proceeds from these sales totaling $104,150 which is included in Receivable - Other on the Balance Sheet and has been subsequently received in October 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 5 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled. The deferred gain of $102,781 will be recognized on the fiscal year 2012 third quarter Statement of Operations.

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $2,000 resulting from the true-up of certain legal and other sale transaction closing expenses arising from Project Partnership sale transactions which closed in the prior fiscal year. This amount, less the applicable state tax withholding, will be distributed to the Series 5 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

NOTE 5 - SUMMARY OF DISPOSITION ACTIVITIES (Continued):

Series 6

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
April 2011	Dawson Elderly	$	31,875	$	3.15	$	31,875
September 2011	Ehrhardt Place Apartments		1,421		0.14		1,421
September 2011	Oak Ridge Apartments		23,151		2.29		23,151
September 2011	Country Place Apartments		22,985		2.27		22,985
September 2011	Other, net (see below)		-		-		4,000
						$	83,432

The net proceeds per BAC from the sale of Dawson Elderly, Ehrhardt Place Apartments, Oak Ridge Apartments and Country Place Apartments are a component of the Distribution Payable on the Balance Sheet as of September 30, 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 6 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $4,000 resulting from the true-up of certain legal and other sale transaction closing expenses arising from Project Partnership sale transactions which closed in the prior fiscal year. This amount, less the applicable state tax withholding, will be distributed to the Series 6 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

Fiscal Year 2011 Disposition Activity:

Series 2

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
August 2010	Richland Elderly	$	27,075	$	4.41	$	27,075
August 2010	Pearson Elderly		19,874		3.24		19,874
August 2010	Mount Vernon Elderly		16,675		2.72		16,675
August 2010	Lakeland Elderly		23,075		3.76		23,075
September 2010	Hartwell Family		1,500		0.24		1,500
September 2010	Deerfield II		1,975		0.32		1,975
November 2010	Cherrytree Apartments		23,769		3.87		23,769
November 2010	Springwood Apartments		36,676		5.98		36,676
December 2010	Manchester Housing		9,387		1.53		9,387
December 2010	Heritage Village Apartments		23,296		3.80		23,296
December 2010	Woodland Terrace Apartments		9,375		1.53		9,375
December 2010	Park Place Apartments		-		-		-
	Other, net (see below)		-		-		163
						$	192,840

The net proceeds per BAC from the sales of Richland Elderly, Pearson Elderly, Mount Vernon Elderly, Lakeland Elderly, Hartwell Family, Deerfield II, Cherrytree Apartments, Springwood Apartments, Manchester Housing, Heritage Village Apartments, Woodland Terrace Apartments and Park Place Apartments are a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, net of any true-up adjustments, ~~will~~were be distributed to the Series 2 Assignees in aSeptember ~~subsequent quarter~~2011.

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $163 resulting from the true-up of certain legal and other sale transaction closing expenses arising from Project Partnership sale transactions which closed in the prior fiscal year. This amount ~~will~~was be distributed to the Series 2 Assignees in aSeptember ~~subsequent quarter~~2011.

NOTE 5 - SUMMARY OF DISPOSITION ACTIVITIES (Continued):

Series 3

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
August 2010	Heritage Villas	$	19,875	$	3.64	$	19,875
September 2010	Nowata Properties		87,294		16.00		87,294
September 2010	Poteau Properties II		142,615		26.14		142,615
September 2010	Roland Properties II		142,615		26.14		142,615
September 2010	Sallisaw Properties		142,615		26.14		142,615
September 2010	Stilwell Properties		131,551		24.11		131,551
September 2010	Waldron Properties		65,162		11.94		65,162
November 2010	Mill Run Apartments		2,538		0.47		2,538
December 2010	Countrywood Apartments		14,650		2.69		14,650
December 2010	Weston Apartments		1,650		0.30		1,650
December 2010	McKinley II Apartments		7,387		1.35		7,387
December 2010	Hornellsville Apartments		7,644		1.40		7,644
December 2010	Wildwood Apartments		27,145		4.98		27,145
December 2010	Hancock Manor Apartments		13,537		2.48		13,537
December 2010	Shiloh Apartments		27,337		5.01		27,337
	Other, net (see below)		-		-		(522	)
						$	833,093

24The net proceeds per BAC from the sale of Heritage Villas, Nowata Properties, Poteau Properties II, Roland Properties II, Sallisaw Properties, Stilwell Properties, Waldron Properties, Mill Run Apartments, Countrywood Apartments, Weston Apartments, McKinley II Apartments, Hornellsville Apartments, Wildwood Apartments, Hancock Manor Apartments and Shiloh Apartments are a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, net of any true-up adjustments, were distributed to the Series 3 Assignees in September 2011.

~~NOTE~~Gateway 5recognized a reduction with respect to the gain on sale of Project Partnerships in the amount of $522 resulting from the true-up ~~SUMMARY~~of OFcertain ~~DISPOSITION~~legal ~~ACTIVITIES~~and ~~(Continued):~~other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This adjustment reduced the amount distributed to the Series 3 Assignees in September 2011.

The net proceeds per BAC from the sale of Heritage Villas, Nowata Properties, Poteau Properties II, Roland Properties II, Sallisaw Properties, Stilwell Properties, Waldron Properties, Mill Run Apartments, Countrywood Apartments, Weston Apartments, McKinley II Apartments, Hornellsville Apartments, Wildwood Apartments, Hancock Manor Apartments and Shiloh Apartments are a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, net of any true-up adjustments, will be distributed to the Series 3 Assignees in a subsequent quarter.

Gateway recognized a reduction with respect to the gain on sale of Project Partnerships in the amount of $522 resulting from the true-up of certain legal and other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This adjustment will reduce the amount distributed to the Series 3 Assignees in a subsequent quarter.

Series 4

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
September 2010	Stilwell Properties II	$	142,615	$	20.62	$	142,615
September 2010	Westville Properties		98,356		14.22		98,356
September 2010	Spring Hill Senior Housing		65,365		9.45		65,365
	Other, net (see below)		-		-		1,000
						$	307,336

The net proceeds per BAC from the sale of Stilwell Properties II, Westville Properties and Spring Hill Senior Housing are a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 4 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $1,000 resulting from the true-up of certain legal and other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This amount, less the applicable state tax withholding, will be distributed to the Series 4 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

NOTE 5 - SUMMARY OF DISPOSITION ACTIVITIES (Continued):

Series 5

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
April 2010	Alma Properties	$	65,230	$	7.54	$	65,230
July 2010	Carrollton Club		106,140		12.32		106,140
August 2010	Crawford Rental Housing		19,875		2.31		19,875
August 2010	Greensboro Properties I		19,075		2.21		19,075
August 2010	Greensboro Properties II		25,475		2.96		25,475
December 2010	Heritage Square Apartments		99,389		11.54		99,389
December 2010	Savannah Park of Grove		164,712		19.12		164,712
December 2010	Savannah Park of Spring Hill		98,526		11.44		98,526
December 2010	Savannah Park of Clayton		65,128		7.56		65,128
	Gain deferred at March 31, 2010		-		-		151,377
	Other, net (see below)		-		-		5,932
						$	820,859

The net proceeds per BAC from the sales of Alma Properties, Blackshear Apartments II, Carrollton Club, Crawford Rental Housing, Greensboro Properties I, Greensboro Properties II, Heritage Square Apartments, Savannah Park of Grove, Savannah Park of Spring Hill and Savannah Park of Clayton are a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 5 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

NOTE 5 - SUMMARY OF DISPOSITION ACTIVITIES (Continued):

Gateway recognized an additional gain on sale of Project Partnerships in the amount of $5,932 resulting from the true-up of certain legal and other sale transaction closing expenses arising from Project Partnership sale transactions which closed in the prior fiscal year. This amount, less the applicable state tax withholding, will be distributed to the Series 5 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

Series 6

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
April 2010	Logan Place L.P.	$	63,038	$	6.24	$	6362,~~038~~250
August 2010	Lancaster House		110,000		10.89		110,000
December 2010	Maple Wood Apartments.		105,356		10.43		105,356
December 2010	Savannah Park of Parsons		131,508		13.01		131,509
	Other, net (see below)		-		-		(788	)
						$	409,115

The net proceeds per BAC from the sales of Logan Place L.P., Lancaster House, Maple Wood Apartments and Savannah Park of Parsons are a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, less the applicable state tax withholding, will be distributed to the Series 6 Assignees in a subsequent period at such time that state withholding tax liabilities have been settled.

~~Gateway~~NOTE ~~recognized~~6 ~~a reduction with respect to the gain on sale of Project Partnerships in the amount of $788 resulting from the true~~-up ofSIGNIFICANT ~~certain~~EQUITY legal and other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This adjustment will reduce the amount distributed to the Series 6 Assignees in a subsequent quarter.INVESTEES:

Certain Project Partnerships constitute 20% or more of assets, equity or income (loss) from continuing operations of the respective Series in which they are held (“Significant Project Partnerships”). In accordance with Gateway’s policy of presenting the financial information of the Project Partnerships on a three month lag, below is the summarized results of operations as of June 30, 2011 for each Significant Project Partnership:

Series 4
	Wynnwood Common			Piedmont Development
Rental and other income	$	98,686		$	85,242
Gross profit		30,966			12,249
Net Loss	$	(3,596	)	$	(16,853	)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

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

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

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

Results of Operations

As more fully detailed in the Exit Strategy discussion included within this MD&A, all of the Project Partnerships have delivered their Tax Credits to Gateway, the Tax Credit compliance period has expired, and Gateway is in the process of selling or disposing of all of its remaining Project Partnership interests. Net proceeds received from the sales are being distributed to the Assignees. Once all Project Partnership interests have been sold or otherwise disposed of, Gateway will be liquidated. The target date for liquidation of Gateway is on or before December 31, 2011, although there is no certainty that all the activities necessary to occur as of such date will have transpired.

Distribution income arises from any cash distributions received from Project Partnerships which have a zero investment balance for financial reporting purposes. Distribution income ~~increased~~decreased $38,~~884~~185 from $1330,~~339~~775 for the ~~three~~six months ended ~~June~~September 30, 2010 to $1722,~~223~~590 for the ~~three~~six months ended ~~June~~September 30, 2011. The ~~increase~~decrease in distribution income ~~for~~is ~~the~~a ~~period~~result ~~ended~~of ~~June~~fewer Project Partnerships invested in by Gateway. As of September 30, 2011, ~~results~~Gateway ~~primarily~~has ~~from~~ an ~~increase~~investment ofin ~~gross~~32 ~~distributions~~Project ~~received~~Partnerships ~~from~~as compared to 63 Project Partnerships held as of September 30, 2010.

26Total expenses of Gateway were $137,296 for the six months ended September 30, 2011, a decrease of $134,831 as compared to the six months ended September 30, 2010 total expenses of $272,127. The decrease results from a decrease in asset management fees and general and administrative expenses - General Partner. During fiscal year 2011, the General Partner ceased further allocations of general and administrative expenses to Gateway.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued):

~~Total~~Gain ~~expenses~~on Sale of ~~Gateway~~Project ~~were~~Partnerships was $5093,~~180~~897 for the ~~three~~six months ended ~~June~~September 30, 2011 compared to $559,787 afor ~~decrease~~the ofsix ~~$71~~months ended September 30,~~447~~ 2010. As more fully discussed within this MD&A, 11 Project Partnership investments were sold during the first six months of fiscal year 2012 as compared to the ~~three~~first six months of fiscal year 2011 when 23 Project Partnership investments were sold. The $93,897 gain recognized in the six months ended ~~June~~September 30, ~~2010~~2011 ~~total~~consists ~~expenses~~of $86,897 related to the sale of five properties during 2012 and $~~121~~7,~~627~~000 related to the true-up of certain sales transaction closing expenses arising from Project Partnership sales transactions which closed in a prior fiscal year. The ~~decrease~~gain ~~results~~on ~~from~~the asale ~~decrease~~of six properties totaling $123,449 was deferred. The $559,787 gain recognized in ~~asset~~the ~~management~~six ~~fees~~months ~~and~~ended ~~general~~September 30, 2010 consists of $408,410 related to the sale of eleven properties during 2011 and ~~administrative~~the ~~expenses~~recognition -of ~~General~~$151,377 ~~Partner~~deferred gain on the March 2010 sale of Blackshear Apartments, L.P., Phase II. ~~During~~The ~~fiscal~~gain ~~year~~on ~~2011~~the sale of twelve properties totaling $1,127,803 was deferred. The amount of the ~~General~~gain ~~Partner~~or ~~ceased~~loss ~~further~~from ~~allocations~~the sale of ~~general~~a Project Partnership and ~~administrative~~the ~~expenses~~period in which it is recognized on the Statement of Operations is dependent upon the specifics related to ~~Gateway~~each sale or disposition transaction. Refer to the discussion of each Project Partnership sold in the Exit Strategy section within this MD&A.

~~Gain~~Interest onincome ~~Sale~~increased of$91 ~~Project~~from ~~Partnerships was~~ $~~31,875~~100 for the ~~three~~six months ended ~~June~~September 30, ~~2011~~2010 ~~compared~~ to $~~216,607~~191 for the ~~three~~six months ended ~~June~~September 30, ~~2010. As more fully discussed within this MD&A, one Project Partnership investment was sold during the first three months of fiscal year 2012 as compared to the first three months of fiscal year~~ 2011 ~~when two Project Partnership investments were sold~~. The ~~$31,875~~change ~~gain recognized~~ in ~~the~~interest ~~three~~income ~~months~~results ~~ended~~from ~~June 30, 2011 related to~~ the ~~sale~~fluctuation of ~~Dawson~~interest ~~Elderly. The~~rates ~~$216,607~~on ~~gain~~short-term ~~recognized~~investments inover ~~the~~this ~~three months ended June 30~~period, ~~2010~~along ~~consists~~with ofan ~~$65,230~~increase ~~related~~in toCash ~~the sale of Alma Properties~~ and ~~the~~Cash ~~recognition~~Equivalents ofover the ~~$151,377~~same ~~deferred gain on the sale of Blackshear Apartments, L~~period.~~P. Phase II.~~ ~~The~~Interest ~~gain~~income ~~on sale of Logan Place L.P. was deferred. The amount of the gain or loss from the sale of a Project Partnership and the period in which it~~ is ~~recognized~~generally onone ~~the~~source ~~Statement~~ of ~~Operations~~funds isavailable ~~dependent upon the specifics related~~ to ~~each~~pay ~~sale~~administrative orcosts ~~disposition transaction. Refer to the discussion~~ of ~~each Project Partnership sold in the Exit Strategy section within this MD&A~~Gateway.

Interest income increased $48 from $40 for the three months ended June 30, 2010 to $88 for the three months ended June 30, 2011. The change in interest income results from the fluctuation of interest rates on short-term investments over this period, along with an increase in Cash and Cash Equivalents over the same period. Interest income is generally one source of funds available to pay administrative costs of Gateway.

Liquidity and Capital Resources

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

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

In total, Gateway reported a net loss of $~~994~~20,618 from operations for the ~~three~~six months ended ~~June~~September 30, 2011. Cash and Cash Equivalents decreased by $~~391~~1,~~317~~466,138. Of the Cash and Cash Equivalents on hand as of ~~June~~September 30, 2011 and March 31, 2011, $21,~~946~~913,~~360~~889 and $3,322,418 are payable to certain Series’ Assignees arising from the sale of Project Partnerships. Distributions will occur to those certain Assignees in a subsequent ~~period~~quarter, less the applicable state tax withholding. After consideration of these sales proceeds, Cash and Cash Equivalents decreased $1557,~~259~~609 as compared to the prior year-end balances.

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

Series 2 - Gateway closed this series on September 14, 1990 after receiving $6,136,000 from 375 Assignees. As of ~~June~~September 30, 2011, all Project Partnerships have been sold.

At ~~June~~September 30, 2011, the Series had $~~480~~66,~~552~~465 of Cash and Cash Equivalents. Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued):

As disclosed on the statement of cash flows, the Series had a net loss of $211,~~768~~319 for the ~~three~~six months ended ~~June~~September 30, 2011. However, after adjusting for the changes in operating assets and liabilities, net cash used in operating activities was $58,~~107~~165. Cash provided by investing activities totaled $1,750 consisting of $750 in cash distributions from the Project Partnerships and $1,000 from Net Proceeds from Sale of Project Partnerships. Cash used in financing activities consists of distributions paid asto ~~state~~or ~~tax payments~~ on behalf of ~~the~~ Assignees totaling $~~129~~541,~~564~~593.

Series 3 - Gateway closed this series on December 13, 1990 after receiving $5,456,000 from 398 Assignees. As of ~~June~~September 30, 2011, all Project Partnerships have been sold.

At ~~June~~September 30, 2011, the Series had $~~761~~73,~~817~~070 of Cash and Cash Equivalents. Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

As disclosed on the statement of cash flows, the Series had a net loss of $314,~~775~~042 for the ~~three~~six months ended ~~June~~September 30, 2011. However, after adjusting for the changes in operating assets and liabilities, net cash used in operating activities was $511,~~460~~743. ~~No cash was provided by investing activities.~~ Cash used in financing activities consists of distributions paid asto ~~state~~or ~~tax payments~~ on behalf of ~~the~~ Assignees totaling $~~153~~836,~~878~~342.

Series 4 - Gateway closed this series on May 31, 1991 after receiving $6,915,000 from 465 Assignees. Equity in Loss of Project Partnerships for the ~~three~~six months ended ~~June~~September 30, 2011 and 2010 was $0 as a result of the suspension of all losses in this Series so that the Investments in Project Partnerships does not fall below zero. For the ~~three~~six months ended ~~March~~June 3130, 2011 and 2010, Gateway’s share of the Project Partnerships’ net loss was $1551,~~658~~413 and $4348,~~501~~150 generated from Rental and other income of $~~182~~361,~~625~~581 and $~~311~~363,~~623~~348, respectively. In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. These Project Partnerships reported depreciation and amortization of $4896,~~035~~071 and $8094,~~042~~665 for the ~~three~~six months ended ~~March~~June 3130, 2011 and 2010, respectively. Overall, management believes these Project Partnerships are operating as expected and have generated Tax Credits which met projections.

At ~~June~~September 30, 2011, the Series had $~~429~~421,~~699~~703 of Cash and Cash Equivalents. Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

As disclosed on the statement of cash flows, the Series had a net loss of $619,~~146~~476 for the ~~three~~six months ended ~~June~~September 30, 2011. However, after adjusting for the changes in operating assets and liabilities, net cash used in operating activities was $615,~~276~~992. Cash provided by investing activities totaled $13,~~470~~190 consisting of cash distributions from the Project Partnerships. Cash used in financing activities consists of distributions paid as state tax payments on behalf of ~~the~~ Assignees totaling $18,958.

Series 5 - Gateway closed this series on October 11, 1991 after receiving $8,616,000 from 535 Assignees. Equity in Loss of Project Partnerships for the ~~three~~six months ended ~~June~~September 30, 2011 and 2010 was $0 as a result of the suspension of all losses in this Series so that the Investments in Project Partnerships does not fall below zero. For the ~~three~~six months ended ~~March~~June 3130, 2011 and 2010, Gateway’s share of the Project Partnerships’ net loss was $75134,~~995~~470 and $~~122~~210,~~031~~794 generated from Rental and other income of $~~415~~665,~~150~~324 and $~~797~~1,~~779~~110,848, respectively. In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. These Project Partnerships reported depreciation and amortization of $~~110~~190,~~196~~902 and $~~200~~286,~~811~~912 for the ~~three~~six months ended ~~March~~June 3130, 2011 and 2010, respectively. Overall, management believes these Project Partnerships are operating as expected and have generated Tax Credits which met projections.

At ~~June~~September 30, 2011, the Series had $1,~~139~~136,~~965~~604 of Cash and Cash Equivalents. Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

As disclosed on the statement of cash flows, the Series had a net loss of $718,~~620~~582 for the ~~three~~six months ended ~~June~~September 30, 2011. However, after adjusting for the changes in operating assets and liabilities, net cash used in operating activities was $720,~~590~~416. Cash provided by investing activities totaled $514,~~024~~489 consisting of $5,024 in cash distributions from the Project Partnerships and $9,465 in net proceeds from the Sale of Project Partnerships (refer to the Exit Strategy section within this MD&A for more detailed discussion of these sales of Project Partnerships). Cash used in financing activities consists of distributions paid as state tax payments on behalf of ~~the~~ Assignees totaling $104,718.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued):

Series 6 - Gateway closed this series on March 11, 1992 after receiving $10,105,000 from 625 Assignees. Equity in Loss of Project Partnerships for the ~~three~~six months ended ~~June~~September 30, 2011 and 2010 was $0 as a result of the suspension of all losses in this Series so that the Investments in Project Partnerships does not fall below zero. For the ~~three~~six months ended ~~March~~June 3130, 2011 and 2010, Gateway’s share of the Project Partnerships’ net loss was $64145,~~924~~625 and $91209,~~727~~580 generated from Rental and other income of $~~901~~1,~~070~~794,770 and $12,~~077~~001,~~254~~005, respectively. In general, it is common in the real estate industry to experience losses for financial and tax reporting purposes because of the non-cash expenses of depreciation and amortization. These Project Partnerships reported depreciation and amortization of $~~222~~445,~~585~~172 and $~~266~~495,~~497~~594 for the ~~three~~six months ended ~~March~~June 3130, 2011 and 2010, respectively. Overall, management believes the Project Partnerships are operating as expected and have generated Tax Credits which met projections.

At ~~June~~September 30, 2011, the Series had $~~602~~641,~~130~~500 of Cash and Cash Equivalents. Management believes the sources of funds are sufficient to meet current and ongoing operating costs for the foreseeable future, and to pay part of the Asset Management Fee.

As disclosed on the statement of cash flows, the Series had net income of $1942,~~315~~801 for the ~~three~~six months ended ~~June~~September 30, 2011. However, after adjusting for the changes in operating assets and liabilities, net cash used in operating activities was $823,~~049~~883. Cash provided by investing activities totaled $4197,~~854~~058 consisting of $913,~~979~~626 in cash distributions from the Project Partnerships and $3183,~~875~~432 in net proceeds from the Sale of Project Partnerships (refer to the Exit Strategy section within this MD&A for more detailed discussion of these sales of Project Partnerships). Cash used in financing activities consists of distributions paid as state tax payments on behalf of ~~the~~ Assignees totaling $815.

Exit Strategy

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

As of ~~June~~September 30, 2011, Gateway holds a limited partner interest in 4232 Project Partnerships which own and operate government assisted multi-family housing complexes. Project investments by Series are as follows: 64 Project Partnerships for Series 4, 127 Project Partnerships for Series 5, and 2421 Project Partnerships for Series 6. Gateway at one time held investments in 148 Project Partnerships (22 in Series 2, 23 in Series 3, 29 in Series 4, 36 in Series 5, and 38 in Series 6). As of ~~June~~September 30, 2011, ~~106~~116 of the Project Partnerships have been sold or otherwise disposed of (22 in Series 2, 23 in Series 3, 2325 in Series 4, 2429 in Series 5, and 1417 in Series 6) and, in accordance with the Gateway partnership agreement, the entire net proceeds received from these sales either have been or will be distributed to the Assignees of the respective Series. During the three months ended ~~June~~September 30, 2011, Gateway sold its interest in 110 Project Partnership (2 in Series 4, 5 in Series 5 and 3 in Series 6). A summary of the sale or disposition transactions for the Project Partnerships disposed during the current fiscal year-to-date and the previous fiscal year are summarized below:

Fiscal Year 2012 Disposition Activity:

Series 62

Transaction		Net		Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	~~Net~~ Proceeds		Per BAC		on Disposal
April 2011	Dawson Elderly	$	31,875	$	3.15	$	31,875
September 2011	Other, net (see below)	$	-	$	-	$	1,000
						$	311,~~875~~000

~~The~~Gateway ~~net~~recognized ~~proceeds~~an ~~per~~additional ~~BAC~~gain ~~from~~on ~~the~~ sale of ~~Dawson~~Project ~~Elderly~~Partnerships ~~are~~in athe ~~component~~amount of ~~the~~$1,000 ~~Distribution~~resulting ~~Payable~~from on the ~~Balance~~true-up ~~Sheet as~~ of ~~June~~certain ~~30,~~legal ~~2011. These~~and ~~net~~other ~~proceeds,~~sale ~~less~~transaction ~~the~~closing ~~applicable~~expenses ~~state~~arising ~~tax~~from ~~withholding,~~a ~~will~~Project bePartnership ~~distributed~~sale totransaction ~~the~~which ~~Series~~closed ~~6 Assignees~~ in athe ~~subsequent~~prior ~~period~~fiscal atyear. This ~~such~~amount ~~time~~was ~~that~~distributed ~~state~~to ~~withholding~~the ~~tax~~Series ~~liabilities~~2 ~~have~~Assignees ~~been~~in ~~settled~~September 2011.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued):

Series 4

Transaction		Net		Net Proceeds		Gain (Loss)		Deferred Gain
Month / Year	Project Partnership	Proceeds		Per BAC		on Disposal		on Disposal
September 2011	SF Apartments of Arkansas City	$	1,909	$	0.28	$	-	$	1,909
September 2011	Wellsville Senior Housing		18,759		2.71		-		18,759
						$	-	$	20,668

Series 5

Transaction		Net		Net Proceeds		Gain (Loss)		Deferred Gain
Month / Year	Project Partnership	Proceeds		Per BAC		on Disposal		on Disposal
August 2011	Yorkshire Retirement Village	$	7,465	$	0.87	$	7,465	$	-
September 2011	SF Apartments of Concordia		42,259		4.90		-		42,259
September 2011	SF Apartments of Medicine Lodge		20,212		2.35		-		20,212
September 2011	SF Apartments of Ottawa II		31,927		3.71		-		31,927
September 2011	SF Apartments of Winfield		8,383		0.97		-		8,383
September 2011	Other, net (see below)		-		-		2,000		-
						$	9,465	$	102,781

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued):

Series 6

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
April 2011	Dawson Elderly	$	31,875	$	3.15	$	31,875
September 2011	Ehrhardt Place Apartments		1,421		0.14		1,421
September 2011	Oak Ridge Apartments		23,151		2.29		23,151
September 2011	Country Place Apartments		22,985		2.27		22,985
September 2011	Other, net (see below)		-		-		4,000
						$	83,432

Fiscal Year 2011 Disposition Activity:

Series 2

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
August 2010	Richland Elderly	$	27,075	$	4.41	$	27,075
August 2010	Pearson Elderly		19,874		3.24		19,874
August 2010	Mount Vernon Elderly		16,675		2.72		16,675
August 2010	Lakeland Elderly		23,075		3.76		23,075
September 2010	Hartwell Family		1,500		0.24		1,500
September 2010	Deerfield II		1,975		0.32		1,975
November 2010	Cherrytree Apartments		23,769		3.87		23,769
November 2010	Springwood Apartments		36,676		5.98		36,676
December 2010	Manchester Housing		9,387		1.53		9,387
December 2010	Heritage Village Apartments		23,296		3.80		23,296
December 2010	Woodland Terrace Apartments		9,375		1.53		9,375
December 2010	Park Place Apartments		-		-		-
	Other, net (see below)		-		-		163
						$	192,840

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued):

Series 3

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
August 2010	Heritage Villas	$	19,875	$	3.64	$	19,875
September 2010	Nowata Properties		87,294		16.00		87,294
September 2010	Poteau Properties II		142,615		26.14		142,615
September 2010	Roland Properties II		142,615		26.14		142,615
September 2010	Sallisaw Properties		142,615		26.14		142,615
September 2010	Stilwell Properties		131,551		24.11		131,551
September 2010	Waldron Properties		65,162		11.94		65,162
November 2010	Mill Run Apartments		2,538		0.47		2,538
December 2010	Countrywood Apartments		14,650		2.69		14,650
December 2010	Weston Apartments		1,650		0.30		1,650
December 2010	McKinley II Apartments		7,387		1.35		7,387
December 2010	Hornellsville Apartments		7,644		1.40		7,644
December 2010	Wildwood Apartments		27,145		4.98		27,145
December 2010	Hancock Manor Apartments		13,537		2.48		13,537
December 2010	Shiloh Apartments		27,337		5.01		27,337
	Other, net (see below)		-		-		(522	)
						$	833,093

30The net proceeds per BAC from the sale of Heritage Villas, Nowata Properties, Poteau Properties II, Roland Properties II, Sallisaw Properties, Stilwell Properties, Waldron Properties, Mill Run Apartments, Countrywood Apartments, Weston Apartments, McKinley II Apartments, Hornellsville Apartments, Wildwood Apartments, Hancock Manor Apartments and Shiloh Apartments are a component of the Distribution Payable on the Balance Sheet as of March 31, 2011. These net proceeds, net of any true-up adjustments, were distributed to the Series 3 Assignees in September 2011.

~~Item~~Gateway ~~2. Management’s~~recognized ~~Discussion~~a ~~and~~reduction ~~Analysis~~with respect to the gain on sale of ~~Financial~~Project ~~Condition~~Partnerships ~~and~~in ~~Results~~the amount of ~~Operations~~$522 ~~(Continued):~~resulting from the true-up of certain legal and other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This adjustment reduced the amount distributed to the Series 3 Assignees in September 2011.

Series 4

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
September 2010	Stilwell Properties II	$	142,615	$	20.62	$	142,615
September 2010	Westville Properties		98,356		14.22		98,356
September 2010	Spring Hill Senior Housing		65,365		9.45		65,365
	Other, net (see below)		-		-		1,000
						$	307,336

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued):

Series 5

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
April 2010	Alma Properties	$	65,230	$	7.54	$	65,230
July 2010	Carrollton Club		106,140		12.32		106,140
August 2010	Crawford Rental Housing		19,875		2.31		19,875
August 2010	Greensboro Properties I		19,075		2.21		19,075
August 2010	Greensboro Properties II		25,475		2.96		25,475
December 2010	Heritage Square Apartments		99,389		11.54		99,389
December 2010	Savannah Park of Grove		164,712		19.12		164,712
December 2010	Savannah Park of Spring Hill		98,526		11.44		98,526
December 2010	Savannah Park of Clayton		65,128		7.56		65,128
	Gain deferred at March 31, 2010		-		-		151,377
	Other, net (see below)		-		-		5,932
						$	820,859

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued):

Series 6

Transaction				Net Proceeds		Gain (Loss)
Month / Year	Project Partnership	Net Proceeds		Per BAC		on Disposal
April 2010	Logan Place L.P.	$	63,038	$	6.24	$	6362,~~038~~250
August 2010	Lancaster House		110,000		10.89		110,000
December 2010	Maple Wood Apartments.		105,356		10.43		105,356
December 2010	Savannah Park of Parsons		131,508		13.01		131,509
	Other, net (see below)		-		-		(788	)
						$	409,115

Gateway recognized a reduction with respect to the gain on sale of Project Partnerships in the amount of $788 resulting from the true-up of certain legal and other sale transaction closing expenses arising from a Project Partnership sale transaction which closed in the prior fiscal year. This adjustment will reduce the amount distributed to the Series 6 Assignees in a subsequent quarter.

Status Update on Unsold Project Partnerships:

The following summarizes the most recent status of the sale/disposal process for the remaining Project Partnership investments held as of ~~June~~September 30, 2011:

Series 4

Wynnwood Common Associates ~~Wellsville Senior Housing, L.P. Sunflower Apartments of Arkansas City~~

These approvals are subject to a number of contingencies, the outcome of which cannot be predicted with certainty. However, utilizing the sales amounts as approved by Gateway, should all the transactions close without modification, the estimated net proceeds to Gateway from the sales of these Project Partnerships are estimated to be $4632,000, or $64.6563 per beneficial assignee certificate. Sales proceeds would be available for distribution, less the applicable state tax withholding, to the Series 4 Assignees in a period subsequent to the closing of these sales transactions which would most likely occur within the next two years.

Series 5

Sunflower Apartments of Concordia Sunflower Apartments of Medicine Lodge Sunflower Apartments of Winfield Sunflower Apartments of Ottawa II

These approvals are subject to a number of contingencies, the outcome of which cannot be predicted with certainty. However, utilizing the sales amounts as approved by Gateway, should all the transactions close without modification, the estimated net proceeds to Gateway from the sales of these Project Partnerships are estimated to be $92,000, or $10.68 per beneficial assignee certificate. Sales proceeds would be available for distribution, less the applicable state tax withholding, to the Series 5 Assignees in a period subsequent to the closing of these sales transactions which would most likely occur within the next two years.

Item 3. Quantitative and Qualitative Disclosure About Market Risk.

As a smaller reporting company, no information is required.

Item 4. Controls and Procedures.

Not applicable to this report.

Item 4T. Controls and Procedures.

Disclosure controls are procedures designed to ensure that information required to be disclosed in Gateway's reports filed under the Exchange Act, such as this report, is recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms. Disclosure controls are also designed to ensure that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives, as Gateway's are designed to do, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Under the supervision and with the participation of the Managing General Partner’s management, including the Chief Executive Officer and Chief Financial Officer, Gateway has evaluated the effectiveness of its disclosure controls and procedures applicable to each of the Series as well as to the total partnership pursuant to Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that these disclosure controls and procedures applicable to each of the Series as well as to the total partnership are effective. There were no changes in Gateway’s internal control over financial reporting during the three months ended ~~June~~September 30, 2011 that have materially affected, or are reasonably likely to materially affect, Gateway’s internal control over financial reporting.

With respect to the Rule 13a-14(a)/15d-14(a) Certifications of the President and Chief Financial Officer, respectively, of the Managing General Partner of Gateway (see Exhibits 31.1 and 31.2 included herein), such certifications are applicable to each of the Series as well as to the total partnership.

PART II - Other Information

Item 1. Legal Proceedings.

Not applicable to this report.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Not applicable to this report.

Item 3. Defaults upon Senior Securities.

Not applicable to this report.

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

Not applicable to this report.

Item 5. Other Information.

Not applicable to this report.

Item 6. Exhibits.

31.1 Principal Executive Officer Certification as required by Rule 13a-14(a)/15d-14(a), filed herewith.

31.2 Principal Financial Officer Certification as required by Rule 13a-14(a)/15d-14(a), filed herewith.

32. Certification of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.

SIGNATURES

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

GATEWAY TAX CREDIT FUND II, LTD.

(A Florida Limited Partnership)

By: Raymond James Tax Credit Funds, Inc.

(the Managing General Partner)

Date: August 15, 2011		By:/s/ Ronald M. Diner
Date: November 10, 2011		By:/s/ Ronald M. Diner
		Ronald M. Diner
		President

Date: August 15, 2011		By:/s/ Toni S. Matthews
Date: November 10, 2011		By:/s/ Toni S. Matthews
		Toni S. Matthews
		Vice President and Chief Financial Officer

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