Related Party Transactions

9 Months Ended

Dec. 31, 2015

NOTE 2 – Related Party Transactions

An affiliate of the General Partner, Independence SLP L.P., has a 0.01% interest as a special limited partner in each of the subsidiary partnerships. An affiliate of the General Partner also has a minority interest in certain local partnerships.

A)Other Related Party Expenses

The costs incurred to related parties for the three and nine months ended December 31, 2015 and 2014 were as follows:


	Three Months Ended				Nine Months Ended
	December 31,				December 31,
	2015		2014		2015		2014

Partnership management fees (a)	$	16,750	$	16,750	$	50,250	$	50,250
Expense reimbursement (b)		28,257		6,064		62,576		18,303
Local administrative fee (c)		1,250		1,250		3,750		3,750
Total general and administrative - General Partner		46,257		24,064		116,576		72,303

Property management fees incurred to affiliates of the subsidiary partnerships’ general partners		13,559		14,367		42,851		43,572
Total general and administrative-related parties	$	59,816	$	38,431	$	159,427	$	115,875

(a)

The General Partner is entitled to receive a partnership management fee, after payment of all Partnership expenses, which together with the annual local administrative fees will not exceed a maximum of 0.05% per annum of invested assets (as defined in the Partnership Agreement), for administering the affairs of the Partnership. Subject to the foregoing limitation, the partnership management fee will be determined by the General Partner in its sole discretion based upon its review of the Partnership’s investments. Unpaid partnership management fees for any year will be accrued without interest and will be payable from working capital reserves or to the extent of available funds after the Partnership has made distributions to the limited partners of sale or refinancing proceeds equal to their original capital contributions plus a 10% priority return thereon (to the extent not theretofore paid out of cash flow). Partnership management fees owed to the General Partner amounting to approximately $1,830,000 and $1,847,000 were accrued and unpaid as of December 31, 2015 and March 31, 2015, respectively, and are included in the line item Due to general partner and affiliates in the condensed consolidated balance sheets. Current year partnership management fees may be paid out of operating reserves or refinancing and sales proceeds. As such, the General Partner cannot demand payment of the deferred fees except as noted above.

(b)

The Partnership reimburses the General Partner and its affiliates for actual Partnership operating expenses incurred by the General Partner and its affiliates on the Partnership’s behalf. The amount of reimbursement from the Partnership is limited by the provisions of the Partnership Agreement. Another affiliate of the General Partner performs asset monitoring for the Partnership. These services include site visits and evaluations of the subsidiary partnerships’ performance. Expense reimbursements and asset monitoring fees owed to the General Partner and its affiliates amounting to approximately $0 and $30,000 were accrued and unpaid as of December 31, 2015 and March 31, 2015, respectively. The General Partner does not intend to demand payment of the deferred payables beyond the Partnership’s ability to pay them. The Partnership anticipates that these will be paid, if at all, from working capital reserves or future sales proceeds.

(c)

Independence SLP L.P., a special limited partner of the subsidiary partnerships, is entitled to receive a local administrative fee of up to $5,000 per year from each subsidiary partnership. As of December 31, 2015 and March 31, 2015, the subsidiary partnerships owed approximately $93,750 and $90,000, respectively, of these fees to Independence SLP L.P. These fees have been deferred in certain cases and the Partnership anticipates that they will be paid, if at all, from working capital reserves or future sales proceeds.

B)Due to Local General Partners and Affiliates

Due to local general partners and affiliates at December 31, 2015 and March 31, 2015 consists of the following:


	December 31,		March 31,
	2015		2015

Construction costs payable	$	120,000	$	120,000
Management and other operating advances		—		5,766
	$	120,000	$	125,766

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References + Details

INDEPENDENCE TAX CREDIT PLUS L P II 10-Q