Edgar Filing: DTF TAX-FREE INCOME INC

DTF TAx - Free Income Inc

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES


Investment Company Act file number:		811-006416

Exact name of registrant as specified in charter:		DTF Tax-Free Income Inc.

Address of principal executive offices:		55 East Monroe St Suite 3600 Chicago, IL 60603

Name and address of agent for service:		Alan Meder Principal Financial Officer 55 East Monroe St. Suite 3600 Chicago, IL 60603

Registrant’s telephone number, including area code:		312-541-5555

Date of fiscal year end:		10/31/05

Date of reporting period:		7/31/05

Item 1 – Schedule of Investments –

DTF TAX FREE INCOME INC.

STATEMENT OF NET ASSETS (UNAUDITED)

As of July 31, 2005

Moody’s

Rating

(Unaudited)

Principal
Amount
(000)

Description (a)

Value

LONG-TERM INVESTMENTS

142.9

Alabama

5.3

Jefferson Cnty. Swr. Rev. Capital Impvt.

Aaa

3,000

(b)

5.125%, 2/1/29, Ser. A, F.G.I.C.

Prerefunded 2/1/09 @ $101

3,211,020

Aaa

2,100

(b)

5.00%, 2/1/33, Ser. A, F.G.I.C.

Prerefunded 2/1/09 @ $101

2,239,083

Aaa

1,900

(b)

5.00%, 2/1/33, Ser. A, F.G.I.C.

Prerefunded 2/1/09 @ $101

2,032,373

7,482,476

Alaska

0.4

Alaska St. Hsg. Fin. Corp., Rev.,

Aaa

500

5.00%, 12/1/11, Ser. B-2

523,155

California

25.8

Burbank Elec. Rev.,

Aaa

1,380

5.375%, 6/1/18, M.B.I.A.

1,516,717

Foothill/Eastern Corr. Agency Toll Road Rev.,

Aaa

5,640

(b)

6.00%, 1/1/34, Ser. A

Prerefunded 1/1/07 @ $100

5,897,015

Fresno Swr. Rev.,

Aaa

3,030

6.00%, 9/1/09, A.M.B.A.C.

3,364,179

Aaa

2,000

6.25%, 9/1/14, A.M.B.A.C

2,393,440

Los Angeles Wastewtr. Sys. Rev.,

Aaa

2,000

5.00%, 6/1/26, Ser. A, M.B.I.A.

2,104,460

Los Angeles Wtr. & Pwr. Rev., Ser. A,

Aaa

1,000

5.25%, 7/1/21, F.S.A.

1,074,570

Aaa

1,000

5.375%, 7/1/21, M.B.I.A.

1,081,690

Metro Wtr. Dist. Southern California Waterwork Rev.

Aaa

1,500

5.00%, 10/1/29, M.B.I.A.

1,586,970

Pomona Sngl. Fam. Mtge. Rev.,

Aaa

2,025

(b)

7.375%, 8/1/10

Escrowed to maturity

2,219,947

Riverside Cnty. Sngl. Fam. Rev., Mtge. Backed,

Aaa

2,500

(b)

7.80%, 5/1/21, Ser. A,

Escrowed to maturity

3,480,950

San Bernardino Cnty. Residential Mtge. Rev.,

Aaa

7,840

(b)

9.60%, 9/1/15,

Escrowed to maturity

11,532,405

Saratoga Unified Sch. Dist.,

Aaa

1,040

Zero Coupon, 9/1/20, Ser. A, F.G.I.C.

529,589

36,781,932

Connecticut

3.4

Connecticut St. Tax Oblig. Rev.,

Aaa

1,000

5.25%, 7/1/17, Ser. B, A.M.B.A.C.

1,132,810

Mashantucket Western Pequot Tribe Spl. Rev.,

Baa3

3,500

5.75%, 9/1/18, Ser. B

3,657,080

4,789,890


Moody’s Rating (Unaudited)	Principal Amount (000)			Description (a)			Value
				District of Columbia	1.1	%
				District of Columbia Wtr. & Swr. Rev.,
Aaa	$	1,500		5.00%, 10/1/33, F.G.I.C.			$	1,561,125

				Florida	10.6	%
				Dade Cnty. Wtr. & Swr. Sys. Rev.,
Aaa		3,000		5.25%, 10/1/26, F.G.I.C.				3,141,060
				Escambia Cnty. Hlth Fac. Rev.,
A3		1,170		5.125%, 10/1/19				1,199,484
				Florida Mun. Ln. Council Rev. North Miami Beach Wtr. Proj.,
Aaa		2,210		5.375%, 8/1/20, Ser. B, M.B.I.A.				2,441,895
				Miami-Dade Cnty. FL Storm Wtr. Util Rev.,
Aaa		2,000		5.00%, 4/1/27, M.B.I.A.				2,124,360
				Sarasota Cnty. Util. Sys. Rev.,
Aaa		1,000		5.25%, 10/1/16, Ser C, F.G.I.C.				1,096,150
				St. Petersburg Public Util. Rev.,
Aaa		5,000		5.00%, 10/1/28, Ser. A, F.S.A.				5,165,150

								15,168,099

				Georgia	16.2	%
				Atlanta Wtr. & Wastewtr. Rev., Ser. A,
Aaa		2,385		5.00%, 11/1/29, F.G.I.C.				2,466,710
Aaa		2,615	(b)	5.00%, 11/1/29, F.G.I.C.
				Prerefunded 5/1/09 @ $101				2,809,478
Aaa		715		5.00%, 11/1/38, F.G.I.C.				736,729
Aaa		785	(b)	5.00%, 11/1/38, F.G.I.C.
				Prerefunded 5/1/09 @ $101				843,380
				De Kalb Cnty. Wtr. & Swr. Rev.,
Aa2		4,000		5.00%, 10/1/24				4,196,920
				Fulton Cnty. Sch. Dist., Gen. Oblig.
Aa2		2,000		5.375%, 1/1/16				2,265,260
				Georgia Mun. Elec. Auth. Pwr. Rev., Ser. Y,
Aaa		145	(b)	6.40%, 1/1/13, A.M.B.A.C.
				Escrowed to Maturity				167,562
Aaa		2,440		6.40%, 1/1/13, A.M.B.A.C.				2,816,297
Aaa		30	(b)	6.40%, 1/1/13, A.M.B.A.C.
				Prerefunded 1/1/11 @ $100				34,454
				Georgia Mun. Elec. Auth. Rev.,
Aaa		5,500		6.50%, 1/1/20, Ser. X, A.M.B.A.C.				6,668,805

								23,005,595

				Hawaii	1.4	%
				Hawaii Dept. Budget & Fin.,
Aaa		2,000		4.80%, 1/1/25, Ser. A, F.G.I.C.				2,014,700

				Idaho	1.1	%
				Idaho Hsg. Agcy., Sngl. Fam. Mtge. Sr., Ser. B,
Aa1		1,075		6.65%, 7/1/14				1,086,760
Aaa		533		6.60%, 7/1/27, F.H.A.				544,278

								1,631,038

				Illinois	4.7	%
				Chicago Gen. Oblig.,
Aaa		4,000		6.25%, 1/1/11, A.M.B.A.C.				4,469,800
				Chicago Park Dist., Gen. Oblig.,
Aaa		1,000		5.00%, 1/1/27, Ser. A, A.M.B.A.C.				1,051,380
				Lake Cnty., Wtr. & Swr. Sys. Rev.,
Aaa		1,000		5.50%, 12/1/10, Ser. A, A.M.B.A.C.				1,102,460

								6,623,640

Moody’s
Rating
(Unaudited)

Principal
Amount
(000)

Description (a)

Value

Indiana

5.6

Indiana Mun. Pwr. Agcy., Pwr. Supply Sys. Rev.,

Aaa

5,000

6.00%, 1/1/13, Ser. B, M.B.I.A.

5,733,300

Indianapolis Local Pub. Impvt. Bond Bank Waterworks Proj.,

Aaa

2,100

5.25%, 7/1/33, Ser. A, M.B.I.A.

2,247,798

7,981,098

Kentucky

1.5

Louisville & Jefferson Cnty. Met. Swr. Dist., Swr. & Drain Sys. Rev.,

Aaa

2,000

5.00%, 5/15/30, Ser. A, F.G.I.C.

2,087,180

Louisiana

0.9

St. Charles Parish, Solid Waste & Disp. Rev.,

(Louisiana Pwr. & Lt. Co.),

Aaa

1,250

7.00%, 12/1/22, Ser. A, F.S.A.

1,254,262

Massachusetts

5.0

Boston Wtr. & Swr. Comm. Rev.,

Aaa

2,000

5.00%, 11/1/28, Ser. D, F.G.I.C.

2,098,180

Massachusetts St. Tpk. Auth., Metro. Highway Sys. Rev.,

Aaa

2,355

5.125%, 1/1/23, Ser. B, M.B.I.A.

2,460,810

Aaa

2,500

4.75%, 1/1/34, Ser. A, A.M.B.A.C.

2,519,750

7,078,740

Michigan

3.0

Detroit Wtr. Supply Sys. Rev., Sr. Lien, Ser. A,

Aaa

2,000

5.50%, 7/1/24, F.G.I.C.

2,192,060

Aaa

2,000

5.00%, 7/1/30, F.G.I.C.

2,072,440

4,264,500

Mississipi

1.2

Mississipi Gulf Coast Reg. Wastewtr. Auth. Rev., Wastewtr. Treatment Facs.,

AAA*

1,500

(b)

7.00%, 7/1/12

Escrowed to maturity

1,751,385

Nebraska

4.8

Lincoln San. Swr. Rev.,

Aaa

1,000

5.00%, 6/15/16, M.B.I.A.

1,082,870

Omaha Pub. Pwr. Dist., Elec. Rev., Ser. B,

Aa2

2,500

(b)

6.15%, 2/1/12

Escrowed to maturity

2,820,450

Aa2

2,500

(b)

6.20%, 2/1/17

Escrowed to maturity

2,958,700

6,862,020


Moody’s Rating (Unaudited)	Principal Amount (000)		Description (a)			Value
			Nevada	3.2	%
			Las Vegas Valley Wtr. Dist., Gen. Oblig.,
Aaa	$	1,400	5.00%, 6/1/25, Ser. B, M.B.I.A.			$	1,474,144
Aaa		3,000	5.00%, 6/1/32, Ser. A, F.G.I.C.				3,119,310

							4,593,454

			New Jersey	1.6	%
			New Jersey St. Gen. Oblig.,
Aa3		2,000	5.25%, 7/1/17, Ser. H				2,243,240

			New York	7.6	%
			Long Island Pwr. Auth. Elec. Sys. Rev.,
Aaa		4,000	5.25%, 12/1/26, Ser. A, M.B.I.A.				4,246,000
			Metro. Trans. Auth. Rev., Ser. A,
Aaa		1,000	5.25%, 11/15/31, Ser. A, F.G.I.C.				1,077,700
			New York City Mun. Wtr. Fin. Auth., Wtr & Swr. Sys. Rev.,
Aaa		5,000	5.00%, 6/15/29, Ser. B, F.S.A.				5,260,100
			New York St. Envir. Fac. Corp., Poll. Ctrl. Rev.,
Aaa		200	6.90%, 11/15/15, Ser. D				204,704

							10,788,504

			Ohio	2.8	%
			Ohio St. Wtr. Dev. Auth. Rev.,
Aaa		2,445	5.50%, 6/1/20, Ser. B, F.S.A.				2,849,305
			Springboro Swr. Sys. Rev.
Aaa		1,045	5.00%, 6/1/26, M.B.I.A.				1,106,143

							3,955,448

			Pennsylvania	2.2	%
			Delaware Cnty. Auth. Rev., Elwyn Inc. Proj.,
Aa3		2,000	5.00%, 6/1/21, Ser. A, Radian				2,094,880
			Pennsylvania Economic Dev. Fin. Auth. Res. Recov. Rev.,
Aaa		1,000	4.625%, 12/1/18, Ser. F, A.M.B.A.C.				1,017,560

							3,112,440

			Puerto Rico	0.8	%
			Puerto Rico Elec. Auth. Rev.,
Aaa		1,000	5.00%, 7/1/25, Ser. PP, F.G.I.C.				1,066,650

			South Carolina	1.9	%
			Berkeley Cnty. Wtr. & Swr. Rev.,
Aaa		1,000	5.25%, 6/1/16, M.B.I.A.				1,100,300
			Spartanburg Waterworks Rev., Jr. Lien.,
Aaa		1,500	5.25%, 6/1/28, F.G.I.C.				1,619,805

							2,720,105

Moody’s
Rating
(Unaudited)

Principal
Amount
(000)

Description (a)

Value

Texas

17.5

Bexar Met. Wtr. Dist. Waterworks Sys. Rev.,

Aaa

2,500

5.00%, 5/1/25, M.B.I.A.

2,581,975

Coastal Wtr. Auth. Contract Rev., City Of Houston Proj.,

Aaa

4,000

5.00%, 12/15/25, F.S.A.

4,121,720

El Paso Wtr. & Swr. Rev.,

Aaa

1,555

5.50%, 3/1/12, Ser. A, F.S.A.

1,726,874

Harris Cnty. Toll Road Sub. Lien, Gen. Oblig.,

Aa1

1,650

7.00%, 8/15/10, Ser. A

1,920,121

Houston Ind. Sch. Dist., Gen.Oblig.,

Aaa

1,000

4.50%, 2/15/26, F.S.A.

1,000,680

Houston Wtr. & Swr. Sys. Rev.,

Aaa

1,500

(b)

5.25%, 12/1/23, Ser. B, F.G.I.C.

Prerefunded 12/1/10 @ $100

1,642,275

Aaa

3,500

(b)

5.00%, 12/1/28, Ser. A, F.S.A.

Prerefunded 12/1/09 @ $100

3,751,720

Lower Colorado River Auth. Rev., Jr. Lien-Fifth Suppl.,

Aaa

1,600

(b)

5.25%, 1/1/15, M.B.I.A.

Escrowed to maturity

1,790,320

Lower Colorado River Auth. Rev., Refunding & Impvmnt.,

Aaa

2,000

5.00%, 5/15/31, F.S.A.

2,061,700

San Antonio Elec. & Gas Rev.,

Aa1

4,000

5.00%, 2/1/18, Ser. A

4,224,960

24,822,345

Virginia

2.9

Henrico Cnty. Wtr & Swr. Rev.,

Aa2

3,985

5.00%, 5/1/28

4,179,269

Washington

5.6

Energy Northwest Wind Proj. Rev.,

Aaa

1,170

5.00%, 7/1/19, A.M.B.A.C.

1,229,986

Aaa

500

4.75%, 7/1/21, M.B.I.A.

517,635

King Cnty. Swr. Rev.,

Aaa

2,500

5.00%, 1/1/31, F.G.I.C.

2,588,700

Seattle Wtr. Sys. Dev. Rev.,

Aaa

1,000

5.00%, 9/1/18, M.B.I.A.

1,071,540

Washington St. Pub. Pwr. Supply, Nuclear Proj. No. 2 Rev.,

Aaa

2,400

6.00%, 7/1/07, Ser. A

2,534,376

7,942,237

Wisconsin

1.6

Milwaukee Met. Swr. Dist., Gen. Oblig.,

Aa1

2,000

(b)

5.25%, 10/1/18, Ser. D

Prerefunded 10/1/13 @ $100

2,218,280


Moody’s Rating (Unaudited)	Principal Amount (000)	Description (a)			Value
		Wyoming	3.2	%
		Wyoming St. Farm Loan Brd. Cap. Facs. Rev.,
AA*	$4,000	5.75%, 10/1/20			$	4,650,720

		Total long-term investments
		(cost $183,147,388)				203,153,527

	Shares
		SHORT-TERM INVESTMENT	1.2	%
		Goldman Sachs Tax Exempt Money Market Fund,
NR	1,721,784	(cost $1,721,784)				1,721,784

		Total Investments	144.1	%
		(cost $184,869,172) (c)				204,875,311

	Other assets in excess of liabilities —		1.6	%		2,291,496

	Liquidation Value of Remarketed Preferred Stock —		(45.7	)%		(65,000,000	)

	Net Assets Applicable to Common Stock —		100.0	%	$	142,166,807

	Net Asset Value per Common Share ($142,166,807 / 8,507,456)				$	16.71

*	Standard & Poor rating.

NR	Not rated by Moody’s or Standard & Poor’s.

(a)	The following abbreviations are used in portfolio descriptions to indicate providers of credit support, in whole or in part:

A.M.B.A.C. - American Municipal Bond Assurance Corporation.

F.G.I.C. - Financial Guarantee Insurance Company.

F.H.A. - Federal Housing Authority.

F.S.A. - Financial Security Assurance Inc.

M.B.I.A. - Municipal Bond Insurance Association.

Radian- Radian Asset Assurance Inc.

(b)	Prerefunded and escrowed to maturity issues are secured by escrowed cash, government obligations, or other securities.

(c)	The United States federal income tax basis of the Fund’s investments and the net unrealized appreciation as of July 31, 2005 was as follows:


Tax Basis of Investment	Appreciation		Depreciation		Net Unrealized Appreciation
$184,475,470	$	20,563,995	$	164,154	$20,399,841

Item 2 – Controls and Procedures

(a)

The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “1940 Act”)) are effective, based on an evaluation of those controls and procedures made as of a date within 90 days of the filing date of this report as required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934.

(b)

There has been no change in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the last fiscal quarter covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 3 – Exhibits

Exhibit 99.CERT- Certifications pursuant to Section 302 of the Sarbanes-Oxley Act – Attached hereto

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

DTF Tax-Free Income Inc.


By:		/s/ Nathan I. Partain
		Nathan I. Partain
		Principal Executive Officer of
		DTF Tax-Free Income Inc.

Date:		September 16, 2005

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.


By:		/s/ Nathan I. Partain
		Nathan I. Partain
		Principal Executive Officer of
		DTF Tax-Free Income Inc.

Date:		09/16/05

By:		/s/ Alan M. Meder
		Alan M. Meder,
		Principal Financial Officer of
		DTF Tax-Free Income Inc.

Date:		09/16/05