July 17, 2006


VIA U.S. MAIL AND FACSIMILE

Mail Stop 4561

Thomas B. Swartz
Chairman and Chief Executive Officer
Capital Alliance Income Trust, Ltd.
100 Pine Street, Suite 2450
San Francisco, CA 94111

      Re:	Capital Alliance Income Trust, Ltd.
			Schedule 14A Proxy Statement
			Filed June 26, 2006
			File No. 0-12941

Dear Mr. Swartz:

      This is to advise you that we have limited our review of the
above proxy statement to the following comments.  Where indicated,
we
think you should revise your document in response to these
comments.
If you disagree, we will consider your explanation as to why our
comments are inapplicable or a revision is unnecessary.  Please be
as
detailed as necessary in your explanation.  We may ask you to
provide
us with information so we may better understand your disclosure.
After reviewing this information, we may or may not raise
additional
comments.

   	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

General
1. Since shareholders are given the option to vote yes or no on
one
or all of proposals two, three and/or four, the outcome of the
vote
is unclear in the event that two of the proposals obtain a
majority
of votes.  Please revise to discuss the consequences of such an
outcome.  In particular, please clarify that if proposal two is
adopted, proposals three and four will not be adopted,
irrespective
of the shareholder vote.


Certain Relationships and Related Transactions
2. Please disclose in detail the circumstances of Mr. Looper`s
resignation.

Interest of Certain Persons in the Proposals, page 7
3. We refer to your statement that you intend to obtain an
independent appraisal in determining the fair market value to the
manager of the management agreement.  Please provide an estimate
of
the termination fee you expect to pay and disclose that amount
here
and on page 11 where you discuss the Review of Alternatives and
Conclusion of the Board of Directors.
4. As a related matter, we note that the "termination fee" payable
is
in addition to any fees or expenses then outstanding under the
management agreement.  Please disclose the anticipated amount of
additional fees payable to the manager under the management
agreement.

Proposal Two

The Board of Directors Proposes that the Corporation be Liquidated
and Dissolved, page 9
5. Please expand your discussion of proposal two to include all
relevant information required by Item 14 of Schedule 14A,
including
pro forma financial statements.
6. On page 10 we note your discussion of a future July 28, 2006
date
in which you claim you have not yet received any offers to
purchase
the business as a going concern.  Since it is not possible to make
that determination at this time, please revise to reference a
current
date to support your statement.
7. At the bottom of page 10, please provide an estimate of the
compensation, or the maximum amount of compensation, you intend to
provide to the trustee or liquidator should proposal two be
adopted.
Provide similar disclosure of the compensation payable to your
officers, directors and agents for services rendered in connection
with the implementation of the plan.  Please also discuss whether
your manager could be constructively terminated upon adoption of
the
plan of liquidation, paid the termination fee, and then receive
compensation separately in connection with the liquidation.
8. Please state in this section that the company is not required
to
obtain appraisals or other third party opinions as to the value of
its assets in connection with the liquidation as mentioned in
section
3(a) of Exhibit A.





Review of Alternatives and Conclusions of the Board of Directors,
page 11
9. Please provide us with copies of any reports the Board
considered
in determining to approve the plan of liquidation.  Please advise
us
whether the Board considered any estimate of potential liquidation
proceeds.

Creditor Liability, page 11
10. Please expand to quantify the funds reserved to defend
lawsuits
and the amount you expect to owe creditors on the September 6,
2006
adoption date.

Abandonment; Amendment, page 13
11. Please expand your disclosure regarding the Board`s ability to
modify, amend or abandon the liquidation plan as approved by the
shareholders.  In particular, please discuss any limitations in
the
charter or under Delaware law on its ability to not proceed with
the
liquidation if approved by the shareholders.  Similarly, please
discuss whether this discretion is only in the event of a change
in
circumstances or may be exercised without limitation.

Contingent Liabilities; Contingency Reserve; Liquidating Trust,
page
15
12. Based on your current assets, liabilities, expenses and
obligations, please provide an estimated range of contingency
reserve
that may be required.

Proposal Four, page 25
13. In your discussion on page 26 relating to your current
Manager`s
performance since inception, please revise subsections (a), (b)
and
(c) to provide information on performance for 2005 and 2006 to the
extent practicable.

Unresolved Staff Comments on Form 10-KSB for the year ended
December
31, 2004
14. We note that there are unresolved Staff comments relating to
your
Forms 10-KSB and 10-KSB/A for the year ended December 31, 2004,
filed
April 15, 2005 and April 20, 2005, respectively.  Please respond
to
the comments contained in our letter dated September 30, 2005.


*	*	*





      As appropriate, please revise your filing and respond to
these
comments within 10 business days or tell us when you will provide
us
with a response.  You may wish to provide us with marked copies of
the revisions to expedite our review.  Please furnish a cover
letter
with your revised document that keys your response to our comment
and
provides any requested information.  Detailed cover letters
greatly
facilitate our review.  Please understand that we may have
additional
comments after reviewing your revised document and responses to
our
comments.

	 We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision.  Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

      In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.

	Please direct any questions to Charito A. Mittelman at (202)
551-3402, or the undersigned at (202) 551-3852.

      Sincerely,



Michael McTiernan
Special Cousnsel







Thomas B. Swartz
Capital Alliance Income Trust, Ltd.
July 17, 2006
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