UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 1997

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

For the transition period from____________ to ____________

For Quarter Ended September 30, 1997 Commission File No. 0-18365

American Income Partners V-B Limited Partnership
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)

Massachusetts 04-3061971
- -------------------------------- -----------------
(State or other jurisdiction (IRS Employer
incorporation or organization) Identification No.)

88 Broad Street, Boston, MA 02110
- ----------------------------------------- -------------
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code (617) 854-5800

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

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court 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_____ NO_____

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

FORM 10-Q

INDEX

PAGE
---------

PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements............................................................................
Statement of Financial Position at September 30, 1997 and December 31, 1996........................... 3
Statement of Operations for the three and nine months ended September 30, 1997 and 1996............... 4
Statement of Cash Flows for the nine months ended September 30, 1997 and 1996......................... 5
Notes to the Financial Statements..................................................................... 6-10
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations........... 11-15
PART II. OTHER INFORMATION:
Items 1--6.............................................................................................. 16

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

STATEMENT OF FINANCIAL POSITION

SEPTEMBER 30, 1997 AND DECEMBER 31, 1996

(UNAUDITED)

SEPTEMBER 30, DECEMBER 31,
1997 1996
------------- ------------

ASSETS
Cash and cash equivalents........................................................... $ 2,615,037 $1,961,623
Rents receivable, net of allowance for doubtful accounts of $10,000 at December 31,
1996.............................................................................. 2,083 233,569
Accounts receivable--affiliate...................................................... 151,862 459,038
Note receivable--Banyan............................................................. 888,844 --
Investment in Banyan................................................................ 590,091 --
Equipment at cost, net of accumulated depreciation of $18,284,464 and $21,000,199 at
September 30, 1997 and December 31, 1996, respectively............................ 1,907,606 4,635,690
------------- ------------
Total assets.................................................................... $ 6,155,523 $7,289,920
------------- ------------
------------- ------------
LIABILITIES AND PARTNERS' CAPITAL
Notes payable....................................................................... $ 121,002 $ 707,842
Accrued interest.................................................................... 1,020 7,428
Accrued liabilities................................................................. 22,500 64,750
Accrued liabilities--affiliate...................................................... 15,403 226,297
Deferred rental income.............................................................. 44,184 45,434
Cash distributions payable to partners.............................................. 285,145 285,145
------------- ------------
Total liabilities............................................................... 489,254 1,336,896
------------- ------------
------------- ------------
Partners' capital (deficit):
General Partner................................................................... (1,433,222) (1,418,884)
Limited Partnership Interests (1,547,930 Units; initial purchase price of $25
each)........................................................................... 7,099,491 7,371,908
------------- ------------
Total partners' capital......................................................... 5,666,269 5,953,024
------------- ------------
Total liabilities and partners' capital......................................... $ 6,155,523 $7,289,920
------------- ------------
------------- ------------

The accompanying notes are an integral part of these financial statements.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

STATEMENT OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996

(UNAUDITED)

THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
---------------------- --------------------------

1997 1996 1997 1996
---------- ---------- ------------ ------------
Income:
Lease revenue.............................................. $ 476,471 $ 850,789 $ 2,554,075 $ 2,281,886
Interest income............................................ 34,544 45,884 83,415 138,096
Gain (loss) on sale/exchange of equipment.................. 38,680 397,078 (305,273) 595,072
---------- ---------- ------------ ------------
Total income............................................. 549,695 1,293,751 2,332,217 3,015,054
---------- ---------- ------------ ------------
Expenses:
Depreciation............................................... 353,104 469,415 1,114,811 1,600,078
Interest expense........................................... 2,044 18,180 22,767 60,714
Equipment management fees--affiliate....................... 23,462 41,238 126,691 117,453
Operating expenses--affiliate.............................. 118,152 (29,775) 499,268 658,831
---------- ---------- ------------ ------------
Total expenses........................................... 496,762 499,058 1,763,537 2,437,076
---------- ---------- ------------ ------------
Net income................................................... $ 52,933 $ 794,693 $ 568,680 $ 577,978
---------- ---------- ------------ ------------
---------- ---------- ------------ ------------
Net income per limited partnership unit...................... $ 0.03 $ 0.49 $ 0.35 $ 0.35
---------- ---------- ------------ ------------
---------- ---------- ------------ ------------
Cash distributions declared per limited partnership unit..... $ 0.17 $ 1.49 $ 0.52 $ 2.24
---------- ---------- ------------ ------------
---------- ---------- ------------ ------------

The accompanying notes are an integral part of these financial statements.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996

(UNAUDITED)

1997 1996
----------- -----------

Cash flows from (used in) operating activities:
Net income............................................................................. $ 568,680 $ 577,978
Adjustments to reconcile net income to net cash from operating activities:
Depreciation......................................................................... 1,114,811 1,600,078
(Gain) loss on sale/exchange of equipment............................................ 305,273 (595,072)
Decrease in allowance for doubtful accounts.......................................... (10,000) --
Changes in assets and liabilities......................................................
Decrease (increase) in:
rents receivable................................................................... 241,486 (35,069)
accounts receivable--affiliate..................................................... 307,176 68,399
Increase (decrease) in:
accrued interest................................................................... (6,408) (3,986)
accrued liabilities................................................................ (42,250) 109,888
accrued liabilities--affiliate..................................................... (210,894) (19,525)
deferred rental income............................................................. (1,250) 24,520
----------- -----------
Net cash from operating activities............................................... 2,266,624 1,727,211
----------- -----------
Cash flows from (used in) investing activities:
Investment in Banyan stock........................................................... (590,091) --
Note receivable--Banyan.............................................................. (888,844) --
Purchase of equipment................................................................ -- (657,000)
Proceeds from equipment sales........................................................ 1,308,000 1,230,055
----------- -----------
Net cash from (used in) investing activities..................................... (170,935) 573,055
----------- -----------
Cash flows used in financing activities:
Principal payments--notes payable.................................................... (586,840) (377,910)
Distributions paid................................................................... (855,435) (2,240,427)
----------- -----------
Net cash used in financing activities............................................ (1,442,275) (2,618,337)
----------- -----------
Net increase (decrease) in cash and cash equivalents................................... 653,414 (318,071)
Cash and cash equivalents at beginning of period....................................... 1,961,623 4,352,348
----------- -----------
Cash and cash equivalents at end of period............................................. $ 2,615,037 $ 4,034,277
----------- -----------
----------- -----------
Supplemental disclosure of cash flow information:
Cash paid during the period for interest............................................. $ 29,175 $ 64,700
----------- -----------
----------- -----------
Supplemental schedule of non-cash investing and financing activities:
See Note 4 to the financial statements.

The accompanying notes are an integral part of these financial statements.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
(UNAUDITED)

NOTE 1--BASIS OF PRESENTATION

The financial statements presented herein are prepared in conformity with
generally accepted accounting principles and the instructions for preparing
Form 10-Q under Rule 10-01 of Regulation S-X of the Securities and Exchange
Commission and are unaudited. As such, these financial statements do not
include all information and footnote disclosures required under generally
accepted accounting principles for complete financial statements and,
accordingly, the accompanying financial statements should be read in
conjunction with the footnotes presented in the 1996 Annual Report. Except as
disclosed herein, there has been no material change to the information
presented in the footnotes to the 1996 Annual Report.

In the opinion of management, all adjustments (consisting of normal and
recurring adjustments) considered necessary to present fairly the financial
position at September 30, 1997 and December 31, 1996 and results of operations
for the three and nine month periods ended September 30, 1997 and 1996 have been
made and are reflected.

NOTE 2--CASH

At September 30, 1997, the Partnership had $2,505,000 invested in reverse
repurchase agreements secured by U.S. Treasury Bills or interests in U.S.
Government securities.

NOTE 3--REVENUE RECOGNITION

Rents are payable to the Partnership monthly or quarterly and no significant
amounts are calculated on factors other than the passage of time. The leases are
accounted for as operating leases and are noncancellable. Rents received prior
to their due dates are deferred. Future minimum rents of $1,654,243 are due as
follows:

For the year ending September 30, 1998 $1,275,645
1999 225,622
2000 47,071
2001 47,071
2002 47,071
Thereafter 11,768
----------
Total $1,654,248
----------
----------

The Partnership entered into a new 18-month lease agreement with
Transmeridian Airlines for its proportionate interest in a Boeing 727 Aircraft
at a base rent to the Partnership of $48,000 per month for 8 months and $42,000
per month for 10 months, effective April 30, 1997.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

NOTES TO THE FINANCIAL STATEMENTS

(CONTINUED)

NOTE 4--EQUIPMENT

The following is a summary of equipment owned by the Partnership at
September 30, 1997. In the opinion of Equis Financial Group Limited Partnership
("EFG"), the acquisition cost of the equipment did not exceed its fair market
value.

REMAINING
LEASE TERM EQUIPMENT
EQUIPMENT TYPE (MONTHS) AT COST
- -------------------------------- ------------- ------------

Aircraft................................. 0-16 $ 16,192,484
Manufacturing............................ 17 1,551,460
Materials handling....................... 0-17 1,066,888
Construction and mining.................. 0-19 526,525
Communications........................... 0 469,389
Trailers/intermodal containers........... 63 299,643
Retail store fixtures.................... 15 30,320
Energy systems........................... 0 29,996
Tractors and heavy duty trucks........... 0 18,426
Computers and peripherals................ 0-15 6,939
--- ------------
Total equipment cost................... 20,192,070
Accumulated depreciation............. (18,284,464)
------------
Equipment, net of accumulated
depreciation..................... $ 1,907,606
------------
------------

During 1995, the Partnership transferred its ownership interest in certain
trailers previously leased to The Atchison Topeka and Santa Fe Railroad. The
Partnership intended to replace all of the trailers with comparable trailers and
account for the transaction as a like-kind exchange for income tax reporting
purposes, a portion of which was completed in 1995. A gain of $31,546,
pertaining to the trailers which had not been exchanged in 1995, was deferred in
anticipation of completing the exchange in 1996. During 1996, the Partnership
elected not to replace the remaining trailers and, accordingly, the remaining
deferred gain of $31,546 was recognized as Gain on Sale of Equipment on the
Statement of Operations for the nine months ended September 30, 1996. In
addition, the remaining cash consideration of $62,539 from the original
transaction was recognized as proceeds from equipment sales in 1996.

At September 30, 1997, the Partnership's equipment portfolio included
equipment having a proportionate original cost of $16,499,034, representing
approximately 82% of total equipment cost.

The summary above includes equipment held for sale or re-lease which had
been fully depreciated with an original cost of approximately $93,000 at
September 30, 1997. The General Partner is actively seeking the sale or re-lease
of all equipment not on lease. In addition, the summary above also includes
equipment being leased on a month-to-month basis.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

NOTES TO THE FINANCIAL STATEMENTS

(CONTINUED)

NOTE 5--INVESTMENT IN BANYAN

On April 30, 1997, the vessel partnerships, in which the Partnership and
certain affiliated investment programs are limited partners and through which
the Partnership and the affiliated investment programs shared economic
interests in three cargo vessels (the "Vessels") leased by KGJS/Gearbulk
Holdings Limited (the "Lessee"), exchanged their ownership interests in the
Vessels for aggregate consideration of $11,565,375, including 1,987,000
shares (at $1.50 per share) of common stock in Banyan Strategic Land Fund II
("Banyan") and a purchase money note of $8,219,500 (the "Note"). Banyan is a
Delaware corporation organized on April 14, 1987 and has its common stock
listed on NASDAQ. Banyan, at the time of the exchange transaction, held
certain real estate investments, the only one of which remained unsold at
September 30, 1997 being a 274 acre site near Malibu, California ("Rancho
Malibu").

The exchange was organized through an intermediary company (Equis Exchange
LLC, 99% owned by Banyan and 1% owned by EFG), which was established for the
sole purpose of facilitating the exchange. There were no fees paid to EFG by
Equis Exchange LLC or Banyan or by any other party that otherwise would not have
been paid to EFG had the Partnership sold its beneficial interest in the Vessels
directly to the Lessee. The Lessee prepaid all of its remaining contracted
rental obligations and purchased the Vessels in two closings occurring on May 6,
1997 and May 12, 1997. The Note was repaid with $3,800,000 of cash and delivery
of a $4,419,500 note from Banyan (the "Banyan Note").

As a result of the exchange transaction and its original 53.54% beneficial
ownership interest in Larkfield, one of the three Vessels, the Partnership
received $847,080 in cash and is the beneficial owner of 393,394 shares of
Banyan common stock valued at $590,091 ($1.50 per share) and holds a beneficial
interest in the Banyan Note of $888,844. The Banyan Note will be amortized over
three years and bear an annual interest rate of 10%.

Cash equal to the amount of the Banyan Note was placed in escrow for the
benefit of Banyan in a segregated account pending the outcome of certain
shareholder proposals. Specifically, as part of the exchange, Banyan agreed to
seek consent ("Consent") from its shareholders to: (1) amend its certificate of
incorporation and by-laws; (2) make additional amendments to restrict the
acquisition of its common stock in a way to protect Banyan's net operating loss
carry-forwards, and (3) engage EFG to provide administrative services to Banyan,
which services EFG will provide at cost. On October 21, 1997, such Consent was
obtained from Banyan's shareholders. The Consent also allowed for (i) the
election of a new Board of Directors nominated by EFG for terms of up to 3 years
and an increase in size of the Board to as many as nine members, provided a
majority of the Board shall consist of members independent of Banyan, EFG or any
affiliate; and (ii) an amendment extending Banyan's life to perpetual and
changing its name. Contemporaneously with the Consent being obtained, Banyan
declared a $0.20 per share distribution to be paid on all shares, including
those beneficially owned by the Partnership. A distribution of $78,679 ($0.20
per share) is scheduled to be paid to the Partnership on or before November 15,
1997.

In connection with the Banyan transaction, Gary D. Engle, President and
Chief Executive Officer of EFG, joined the Board of Directors of Banyan and
James A. Coyne, Senior Vice President of EFG became Banyan's Chief Operating
Officer. The General Partner believes that the underlying tangible assets of
Banyan, particularly the Rancho Malibu property, can be sold or developed on a
tax free basis due to Banyan's net operating loss carryforwards and can provide
an attractive economic return to the Partnership.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

NOTES TO THE FINANCIAL STATEMENTS

(CONTINUED)

NOTE 6--RELATED PARTY TRANSACTIONS

All operating expenses incurred by the Partnership are paid by EFG on
behalf of the Partnership and EFG is reimbursed at its actual cost for such
expenditures. Fees and other costs incurred during each of the nine month
periods ended September 30, 1997 and 1996, which were paid or accrued by the
Partnership to EFG or its Affiliates, are as follows:

1997 1996
---------- ----------

Equipment management fees........................ $ 126,691 $ 117,453
Administrative charges........................... 41,995 15,750
Reimbursable operating expenses
due to third parties........................... 457,273 643,081
---------- ----------
Total........................................ $ 625,959 $ 776,284
---------- ----------
---------- ----------

All rents and proceeds from the sale of equipment are paid directly to
either EFG or to a lender. EFG temporarily deposits collected funds in a
separate interest-bearing escrow account prior to remittance to the Partnership.
At September 30, 1997, the Partnership was owed $151,862 by EFG for such funds
and the interest thereon. These funds were remitted to the Partnership in
October 1997.

NOTE 7--NOTES PAYABLE

Notes payable at September 30, 1997 consisted of two installment notes of
$121,002 payable to an institutional lender. The installment notes are
non-recourse, both with interest rates of 10.12%. The installment notes are
collateralized by the equipment and assignment of the related lease payments and
will be fully amortized by noncancellable rents or the Partnership's available
cash in the year ending September 30, 1998. The carrying value of notes payable
approximates fair value at September 30, 1997.

NOTE 8--LEGAL PROCEEDINGS

On July 27, 1995, EFG, on behalf of the Partnership and other EFG-sponsored
investment programs, filed an action in the Commonwealth of Massachusetts
Superior Court Department of the Trial Court in and for the County of Suffolk,
for damages and declaratory relief against a lessee of the Partnership, National
Steel Corporation ("National Steel"), under a certain Master Lease Agreement
("MLA") for the lease of certain equipment. EFG is seeking the reimbursement by
National Steel of certain sales and/or use taxes paid to the State of Illinois
and other remedies provided by the MLA. On August 30, 1995, National Steel filed
a Notice of Removal which removed the case to the United States District Court,
District of Massachusetts. On September 7, 1995, National Steel filed its Answer
to EFG's Complaint along with Affirmative Defenses and Counterclaims, seeking
declaratory relief and specific performance and alleging, among other things,
breach of contract and breach of the implied covenant of good faith and fair
dealing. EFG filed its Answer to these counterclaims on September 29, 1995.
Though the parties have been discussing settlement with respect to this matter
for some time, to date, the negotiations have been unsuccessful. Notwithstanding
these discussions, EFG recently filed an Amended and Supplemental Complaint
alleging a further default by National Steel under the MLA and EFG recently
filed a motion for Summary Judgment on all claims and counterclaims. The matter
remains pending before the Court and is scheduled for a hearing on EFG's motion
in December 1997. The Partnership has not experienced any material losses as a
result of this action.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

NOTES TO THE FINANCIAL STATEMENTS

(CONTINUED)

On June 24, 1997, four plaintiffs (the "Plaintiffs") owning limited
partner units or beneficiary interests in eight investment programs sponsored
by EFG filed a lawsuit, as a derivative action, on behalf of the Partnership
and 27 other investment programs (collectively, the "Nominal Defendants") in
the Superior Court of the Commonwealth of Massachusetts for the County of
Suffolk against EFG and certain of EFG's affiliates, including the General
Partner of the Partnership and four other wholly-owned subsidiaries of EFG
which are the general partner or managing trustee of one or more of the
investment programs, (collectively, the "Managing Defendants"), and certain
other entities and individuals that have control of the Managing Defendants
and the Nominal Defendants (the "Controlling Defendants"). The Plaintiffs
assert claims of breach of fiduciary duty, breach of contract, unjust
enrichment, and equitable relief and seek various remedies, including
compensatory and punitive damages to be determined at trial.

The General Partner and EFG are in the early stages of evaluating the nature
and extent of the claims asserted in this lawsuit and cannot predict its outcome
with any degree of certainty. However, based upon all of the facts presently
being considered by management, the General Partner and EFG do not believe that
any likely outcome will have a material adverse effect on the Partnership. The
General Partner, EFG and their affiliates intend to vigorously defend against
the lawsuit.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

FORM 10-Q

PART 1. FINANCIAL INFORMATION

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.

Certain statements in this quarterly report that are not historical fact
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and are subject to a variety of risks
and uncertainties. There are a number of important factors that could cause
actual results to differ materially from those expressed in any forward-looking
statements made herein. These factors include, but are not limited to, the
ability of EFG to collect all rents due under the attendant lease agreements and
successfully remarket the Partnership's equipment upon the expiration of such
leases.

Three and nine months ended September 30, 1997 compared to the three and nine
months ended September 30, 1996:

OVERVIEW

The Partnership was organized in 1989 as a direct-participation equipment
leasing program to acquire a diversified portfolio of capital equipment subject
to lease agreements with third parties. The Partnership's stated investment
objectives and policies contemplated that the Partnership would wind-up its
operations within approximately seven years of its inception. Accordingly, the
General Partner is pursuing the remarketing of all of the Partnership's
remaining equipment. Currently, the General Partner anticipates that it will
wind-up the operations of the Partnership and make a liquidating distribution to
the Partners, net of any cash reserves which the General Partner may consider
appropriate, possibly by December 31, 1998.

RESULTS OF OPERATIONS

For the three and nine months ended September 30, 1997, the Partnership
recognized lease revenue of $476,471 and $2,554,075, respectively, compared to
$850,789 and $2,281,886 for the same periods in 1996. Lease revenue in 1997
includes the receipt of prepaid contractual rental obligations of $1,142,614
associated with the exchange of its interest in the vessel (see discussion
below). In addition, lease revenue for the three and nine months ended September
30, 1996 included the receipt of $265,796 of lease termination rents received in
connection with the sale of the Partnership's interest in two 727-Advanced
aircraft in July 1996 (see discussion below). The Partnership also earns
interest income from temporary investments of rental receipts and equipment
sales proceeds in short-term instruments.

The Partnership's equipment portfolio includes certain assets in which the
Partnership holds a proportionate ownership interest. In such cases, the
remaining interests are owned by an affiliated equipment leasing program
sponsored by EFG. Proportionate equipment ownership enables the Partnership to
further diversify its equipment portfolio by participating in the ownership of
selected assets, thereby reducing the general levels of risk which could result
from a concentration in any single equipment type, industry or lessee. The
Partnership and each affiliate individually report, in proportion to their
respective ownership interests, their respective shares of assets, liabilities,
revenues, and expenses associated with the equipment.

During the three months ending September 30, 1997, the Partnership sold
equipment having a net book value of $320 to existing lessees and third parties.
These sales resulted in a net gain, for financial statement purposes, of
$38,680. During the nine months ended September 30, 1997, the Partnership sold
or exchanged equipment having a net book value of $1,613,273, to existing
lessees and third parties. These transactions resulted in a net loss, for
financial statement purposes of $305,273. The equipment transactions included
the Partnership's interest in a vessel with an original cost and net book value
of $4,205,030 and $1,597,566, respectively. In connection with this transaction,
the Partnership realized proceeds of $1,183,401, which resulted in a net loss

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

FORM 10-Q

PART 1. FINANCIAL INFORMATION

for financial statement purposes, of $414,165. In addition, as this vessel was
disposed of prior to the expiration of the related lease term, the Partnership
received a prepayment of the remaining contracted rent due under the vessel's
lease agreement, as described above. See below for further discussion related to
the vessel.

On April 30, 1997, the vessel partnerships, in which the Partnership and
certain affiliated investment programs are limited partners and through which
the Partnership and the affiliated investment programs shared economic interests
in three cargo vessels (the "Vessels") leased by KGJS/Gearbulk Holdings Limited
(the "Lessee"), exchanged their ownership interests in the Vessels for aggregate
consideration of $11,565,375, including 1,987,000 shares (at $1.50 per share) of
common stock in Banyan Strategic Land Fund II ("Banyan") and a purchase money
note of $8,219,500 (the "Note"). Banyan is a Delaware corporation organized on
April 14, 1987 and has its common stock listed on NASDAQ. Banyan, at the time of
the exchange transaction, held certain real estate investments, the only one of
which remained unsold at September 30, 1997 being a 274 acre site near Malibu,
California ("Rancho Malibu").

The General Partner believes that the underlying tangible assets of Banyan,
particularly the Rancho Malibu property, can be sold or developed on a tax free
basis due to Banyan's net operating loss carryforwards and can provide an
attractive economic return to the Partnership.

For the three and nine months ended September 30, 1996, the Partnership sold
equipment having a net book value of $544,833 and $603,990, respectively, to
existing lessees and third parties. These sales resulted in net gains, for
financial statement purposes, of $397,078 and $595,072, respectively. These
equipment sales included the sale of the Partnership's interest in two Boeing
727-Advanced jet aircraft with an original cost and net book value of $2,404,163
and $431,852, respectively, which the Partnership sold to the existing lessee in
July 1996. In connection with these sales, the Partnership realized sale
proceeds of $615,218, which resulted in a net gain, for financial statement

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

FORM 10-Q

PART 1. FINANCIAL INFORMATION

purposes, of $183,366. This equipment was sold prior to the expiration of the
related lease term. The Partnership also realized lease termination rents equal
to $265,796 relating to these aircraft.

During 1995, the Partnership transferred its ownership interest in
certain trailers previously leased to The Atchison Topeka and Santa Fe
Railroad. The Partnership intended to replace all of the trailers with
comparable trailers and account for the transaction as a like-kind exchange
for income tax reporting purposes, a portion of which was completed in 1995.
A gain of $31,546, pertaining to the trailers which had not been exchanged in
1995, was deferred in anticipation of completing the exchange in 1996. During
1996, the Partnership elected not to replace the remaining trailers and,
accordingly, the remaining deferred gain of $31,546 was recognized as Gain on
Sale of Equipment on the Statement of Operations for the nine months ended
September 30, 1996. See Note 4 to the financial statements for additional
discussion.

It cannot be determined whether future sales of equipment will result in a
net gain or a net loss to the Partnership, as such transactions will be
dependent upon the condition and type of equipment being sold and its
marketability at the time of sale. In addition, the amount of gain or loss
reported for financial statement purposes is partly a function of the amount of
accumulated depreciation associated with the equipment being sold.

The ultimate realization of residual value for any type of equipment is
dependent upon many factors, including EFG's ability to sell and re-lease
equipment. Changing market conditions, industry trends, technological advances,
and many other events can converge to enhance or detract from asset values at
any given time. EFG attempts to monitor these changes in order to identify
opportunities which may be advantageous to the Partnership and which will
maximize total cash returns for each asset.

The total economic value realized upon final disposition of each asset is
comprised of all primary lease term revenue generated from that asset, together
with its residual value. The latter consists of cash proceeds realized upon the
asset's sale in addition to all other cash receipts obtained from renting the
asset on a re-lease, renewal or month-to-month basis. The Partnership classifies
such residual rental payments as lease revenue. Consequently, the amount of gain
or loss reported in the financial statements is not necessarily indicative of
the total residual value the Partnership achieved from leasing the equipment.

Depreciation expense for the three and nine months ended September 30, 1997
was $353,104 and $1,114,811, respectively, compared to $469,415 and $1,600,078
for the same periods in 1996. For financial reporting purposes, to the extent
that an asset is held on primary lease term, the Partnership depreciates the
difference between (i) the cost of the asset and (ii) the estimated residual
value of the asset on a straight-line basis over such term. For purposes of this
policy, estimated residual values represent estimates of equipment values at the
date of primary lease expiration. To the extent that an asset is held beyond its
primary lease term, the Partnership continues to depreciate the remaining net
book value of the asset on a straight-line basis over the asset's remaining
economic life.

Interest expense was $2,044 and $22,767 or less than 1% of lease revenue for
the three and nine months ended September 30, 1997, respectively, compared to
$18,180 and $60,714 or 2.1% and 2.7% of lease revenue for the same periods in
1996. Interest expense in future periods will continue to decline in amount and
as a percentage of lease revenue as the principal balance of notes payable is
reduced through the application of rent receipts to outstanding debt. In
addition, the General Partner expects to use a portion of the Partnership's
available cash to retire indebtedness.

Management fees were 4.9% and 5% of lease revenue for the three and nine
months ended September 30, 1997, respectively, compared to 4.8% and 5.1% of
lease revenue for each of the same periods in 1996. Management fees during the
nine months ended September 30, 1996, include $7,780 resulting from an

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

FORM 10-Q

PART 1. FINANCIAL INFORMATION

underaccrual in 1995. Management fees are based on 5% of gross lease revenue
generated by operating leases and 2% of gross lease revenue generated by full
payout leases.

Operating expenses consist principally of administrative charges,
professional service costs, such as audit and legal fees, as well as
printing, distribution and remarketing expenses. In certain cases, equipment
storage or repairs and maintenance costs may be incurred in connection with
equipment being remarketed. Significant operating expenses were incurred
during the nine months ended September 30, 1997 and 1996 due to heavy
maintenance and airframe overhaul costs incurred or accrued in connection
with the Partnership's interests in two Boeing 727 aircraft. Certain of the
costs incurred in the first quarter of 1996 were subsequently reimbursed by
the former lessee of the related aircraft in the third quarter of 1996. In
1996, the Partnership entered into a new 36-month lease agreement with
Sunworld International Airlines, Inc. to re-lease one of the aircraft. The
second aircraft was re-leased to Transmeridian Airlines beginning April 1997
at a base rent to the Partnership of $48,000 per month for 8 months and
$42,000 per month for 10 months. The amount of future operating expenses
cannot be predicted with certainty; however, such expenses are usually higher
during the acquisition and liquidation phases of a partnership. Other
fluctuations typically occur in relation to the volume and timing of
remarketing activities.

LIQUIDITY AND CAPITAL RESOURCES AND DISCUSSION OF CASH FLOWS

The Partnership by its nature is a limited life entity which was established
for specific purposes described in the preceding "Overview". As an equipment
leasing program, the Partnership's principal operating activities derive from
asset rental transactions. Accordingly, the Partnership's principal source of
cash from operations is provided by the collection of periodic rents. These cash
inflows are used to satisfy debt service obligations associated with leveraged
leases, and to pay management fees and operating costs. Operating activities
generated net cash inflows of $2,266,624 and $1,727,211 for the nine months
ended September 30, 1997 and 1996, respectively. Net cash from operating
activities in both 1997 and 1996 included lease termination rents as described
above. Future renewal, re-lease and equipment sale activities will cause a
decline in the Partnership's lease revenue and corresponding sources of
operating cash. Overall, expenses associated with rental activities, such as
management fees, and net cash flow from operating activities will also decline
as the Partnership experiences a higher frequency of remarketing events.

Ultimately, the Partnership will dispose of all assets under lease. This
will occur principally through sale transactions whereby each asset will be sold
to the existing lessee or to a third party. Generally, this will occur upon
expiration of each asset's primary or renewal/re-lease term. In certain
instances, casualty or early termination events may result in the disposal of an
asset. Such circumstances are infrequent and usually result in the collection of
stipulated cash settlements pursuant to terms and conditions contained in the
underlying lease agreements.

Cash expended for equipment acquisitions and cash realized from asset
disposal transactions are reported under investing activities on the
accompanying Statement of Cash Flows. During the nine months ended September 30,
1997, the Partnership realized net cash proceeds of $1,308,000 including
proceeds from the exchange transaction, compared to $1,230,055 for the same
period in 1996. Future inflows of cash from asset disposals will vary in timing
and amount and will be influenced by many factors including, but not limited to,
the frequency and timing of lease expirations, the type of equipment being sold,
its condition and age, and future market conditions. During the nine months
ended September 30, 1996, the Partnership expended $657,000 to replace certain
aircraft engines to facilitate the re-lease of an aircraft to Transmeridian
Airlines, discussed above. There were no equipment acquisitions during the same
period in 1997.

Banyan common stock valued at $590,091 ($1.50 per share) and holds a beneficial
interest in the Banyan Note of $888,844.

The Partnership obtained long-term financing in connection with certain
equipment leases. The repayments of principal related to such indebtedness are
reported as a component of financing activities. Each note payable is recourse
only to the specific equipment financed and to the minimum rental payments
contracted to be received during the debt amortization period (which period
generally coincides with the lease rental term). As rental payments are
collected, a portion or all of the rental payment is used to repay the
associated indebtedness. The Partnership's notes payable are scheduled to be
fully amortized by noncanellable rents during the year ending September 30,
1998. In addition, the General Partner expects to use a portion of the
Partnership's available cash to retire indebtedness.

Cash distributions to the General Partner and Recognized Owners are
declared and generally paid within fifteen days following the end of each
calendar quarter. The payment of such distributions is presented as a
component of financing activities. For the nine months ended September 30,
1997, the Partnership declared total cash distributions of Distributable Cash
From Operations and Distributable Cash From Sales and Refinancings of
$855,435. In accordance with the Amended and Restated Agreement and
Certificate of Limited Partnership, the Recognized Owners were allocated 95%
of these distributions, or $812,663 and the General Partner was allocated 5%,
or $42,772. The second quarter 1997 cash distribution was paid on October 14,
1997.

Cash distributions paid to the Recognized Owners consist of both a return of
and a return on capital. Cash distributions do not represent and are not
indicative of yield on investment. Actual yield on investment cannot be
determined with any certainty until conclusion of the Partnership and will be
dependent upon the collection of all future contracted rents, the generation of
renewal and/or re-lease rents, and the residual value realized for each asset at
its disposal date. Future market conditions, technological changes, the ability
of EFG to manage and remarket the assets, and many other events and
circumstances, could enhance or detract from individual asset yields and the
collective performance of the Partnership's equipment portfolio.

The future liquidity of the Partnership will be influenced by the foregoing
and will be greatly dependent upon the collection of contractual rents and the
outcome of residual activities. The General Partner anticipates that cash
proceeds resulting from these sources will satisfy the Partnership's future
expense obligations. However, the amount of cash available for distribution in
future periods will fluctuate. Equipment lease expirations and asset disposals
will cause the Partnership's net cash from operating activities to diminish over
time; and equipment sale proceeds will vary in amount and period of realization.
In addition, the Partnership may be required to incur asset refurbishment or
upgrade costs in connection with future remarketing activities. Accordingly,
fluctuations in the level of future quarterly cash distributions are
anticipated.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

FORM 10-Q

PART II. OTHER INFORMATION

Item 1. Legal Proceedings Response:

Refer to Note 8 to the financial statements,
herein.

Item 2. Changes in Securities Response: None

Item 3. Defaults upon Senior Securities Response:
None

Item 4. Submission of Matters to a Vote of Security
Holders Response: None

Item 5. Other Information Response: None

Item 6(a). Exhibits Response: None

Item 6(b). Reports on Form 8-K Response: None

SIGNATURE PAGE

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below on behalf of the registrant and in the
capacity and on the date indicated.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

By: AFG Leasing IV Incorporated, a Massachusetts
corporation and the General Partner of the
Registrant.

By: _____________________________________________
Michael J. Butterfield
Treasurer of AFG Leasing IV Incorporated
(Duly Authorized Officer and
Principal Accounting Officer)

Date:_____________________________________________

By: _______________________________________________
Gary M. Romano
Clerk of AFG Leasing IV Incorporated
(Duly Authorized Officer and
Principal Financial Officer)

Date: ______________________________________________

SIGNATURE PAGE

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below on behalf of the registrant and in the
capacity and on the date indicated.

AMERICAN INCOME PARTNERS V-B LIMITED PARTNERSHIP

By: AFG Leasing IV Incorporated, a Massachusetts
corporation and the General Partner of the
Registrant.

By: /s/ Michael J. Butterfield
_____________________________________________
Michael J. Butterfield
Treasurer of AFG Leasing IV Incorporated
(Duly Authorized Officer and
Principal Accounting Officer)

Date: November 14, 1997
_______________________________________________

By: /s/ Gary M. Romano
_______________________________________________
Gary M. Romano
Clerk of AFG Leasing IV Incorporated
(Duly Authorized Officer and
Principal Financial Officer)

Date: November 14, 1997
________________________________________________