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

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-06416

DTF Tax-Free Income Inc.

(Exact name of registrant as specified in charter)

55 East Monroe Street, Suite 3600, Chicago, Illinois 60603

(Address of principal executive offices) (Zip code)


Alan M. Meder		Lawrence R. Hamilton
DTF Tax-Free Income Inc.		Mayer Brown LLP
55 East Monroe Street, Suite 3600		71 South Wacker Drive
Chicago, Illinois 60603		Chicago, Illinois 60606

(Name and address of agents for service)

Registrant’s telephone number, including area code: (312) 263-2610

Date of fiscal year end: October 31

Date of reporting period: January 31, 2008

Item 1 – Schedule of Investments

DTF TAX-FREE INCOME INC.

Portfolio of Investments

As of 1/31/2008 (unaudited)


Principal Amount (000)			Description (a)			Value
			LONG-TERM INVESTMENTS	144.9	%
			Alabama	6.0	%
			DCH Health Care Auth. Rev.
$	1,000		5.125%, 6/1/36			$	999,190
			Jefferson Cnty. Swr. Rev.
			Capital Impvt.
	3,000	(b)	5.125%, 2/1/29, Ser. A, F.G.I.C.
			Pre-refunded 2/1/09 @ $101				3,118,620
	2,100	(b)	5.00%, 2/1/33, Ser. A, F.G.I.C.
			Pre-refunded 2/1/09 @ $101				2,179,611
	1,900	(b)	5.00%, 2/1/33, Ser. A, F.G.I.C.
			Pre-refunded 2/1/09 @ $101				1,973,378

							8,270,799

			California	21.7	%
			California St. Gen. Oblig.,
	1,000		5.00%, 11/1/32				1,004,140
			Fresno Swr. Rev., Ser. A-1,
	3,030		6.00%, 9/1/09, A.M.B.A.C.				3,207,497
	2,000		6.25%, 9/1/14, A.M.B.A.C.				2,266,480
			Golden State Tobacco Securitization Corp. Rev.,
	1,000		5.75%, 6/1/47, Ser. A-1				956,510
			Los Angeles Wastewtr. Sys. Rev.,
	2,000		5.00%, 6/1/26, Ser. A, M.B.I.A.				2,053,500
			Los Angeles Wtr. & Pwr. Rev.,
	1,000		5.25%, 7/1/21, Ser. A-A-1, F.S.A.				1,057,190
	1,000		5.375%, 7/1/21, Ser. A-A-2, M.B.I.A.				1,067,160
			Metro Wtr. Dist. Southern California Waterworks Rev.,
	1,500		5.00%, 10/1/29, Ser. B-3, M.B.I.A.				1,554,930
			Pomona Sngl. Fam. Mtge. Rev.,
	1,200	(b)	7.375%, 8/1/10, Ser. B, GNMA Collateral
			Escrowed to maturity				1,265,028
			Riverside Cnty. Sngl. Fam. Rev.,
	2,500	(b)	7.80%, 5/1/21, Ser. A, GNMA Collateral
			Escrowed to maturity				3,454,400
			San Bernardino Cnty. Residential
			Mtge. Rev.,
	7,840	(b)	9.60%, 9/1/15,
			Escrowed to maturity				11,263,258
			Saratoga Unified Sch. Dist., Gen. Oblig.
	1,040		Zero Coupon, 9/1/20, Ser. A, F.G.I.C.				588,983

							29,739,076

			Connecticut	3.3	%
			Connecticut St. Health & Edl. Facs. Auth. Rev.,
	1,000		5.00%, 7/1/25, Ser. C, Radian				1,018,560
			Mashantucket Western Pequot
			Tribe Spl. Rev., 144A,
	3,500	(c)	5.75%, 9/1/18, Ser. B				3,524,500

							4,543,060

			District of Columbia	1.1	%
			District of Columbia Wtr. & Swr. Auth. Rev.,
	1,500		5.00%, 10/1/33, F.G.I.C.				1,519,830


Principal Amount (000)			Description (a)			Value
			Florida	8.7	%
			Brevard Cnty. Hlth. Fac. Auth. Rev.,
$	1,005		5.00%, 4/1/34			$	981,985
			Escambia Cnty. Hlth. Fac. Auth. Rev.,
	1,190		5.125%, 10/1/19				1,202,757
			Florida Mun. Ln. Council Rev.,
	2,210		5.375%, 8/1/20, Ser. B, M.B.I.A.				2,411,640
			Highlands Cnty. Hlth. Fac. Auth. Rev.,
	2,000		5.125%, 11/15/32, Ser. G				2,004,760
			St. Petersburg Public Util. Rev.,
	5,000	(b)	5.00%, 10/1/28, Ser. A, F.S.A.
			Pre-refunded 10/1/09 @ $101				5,283,550

							11,884,692

			Georgia	16.6	%
			Atlanta Wtr. & Wastewtr. Rev.,
			Ser. A,
	2,385		5.00%, 11/1/29, F.G.I.C.				2,406,012
	2,615	(b)	5.00%, 11/1/29, F.G.I.C.
			Pre-refunded 5/1/09 @ $101				2,725,745
	715		5.00%, 11/1/38, F.G.I.C.				718,561
	785	(b)	5.00%, 11/1/38, F.G.I.C.
			Pre-refunded 5/1/09 @ $101				818,245
			De Kalb Cnty. Wtr. & Swr. Rev.,
	4,000	(b)	5.00%, 10/1/24
			Pre-refunded 10/1/09 @ $101				4,226,840
			Fulton Cnty. Sch. Dist., Gen. Oblig.
	2,000		5.375%, 1/1/16				2,309,600
			Georgia Mun. Elec. Auth. Pwr. Rev.,
	145	(b)	6.40%, 1/1/13, Ser. Y, A.M.B.A.C.
			Escrowed to maturity				163,296
	2,440		6.40%, 1/1/13, A.M.B.A.C.				2,735,704
	30	(b)	6.40%, 1/1/13
			Pre-refunded 1/1/11 @ $100				33,324
			Georgia Mun. Elec. Auth. Pwr. Rev.,
	5,500		6.50%, 1/1/20, Ser. X, A.M.B.A.C.				6,637,235

							22,774,562

			Hawaii	1.5	%
			Hawaii Dept. Budget & Fin. Rev.,
	2,000		4.80%, 1/1/25, Ser. A, F.G.I.C.				1,984,820

			Idaho	0.5	%
			Idaho Hsg. Agcy.,
			Sngl. Fam. Mtge. Sr., Rev.,
	345		6.65%, 7/1/14, Ser. B				358,296
	258		6.60%, 7/1/27, Ser. B				266,271

							624,567

			Illinois	4.8	%
			Chicago Gen. Oblig.,
	4,000		6.25%, 1/1/11, A.M.B.A.C.				4,239,120
			Chicago Multi-Family Hsg. Rev.,
	500		4.90%, 3/20/44, F.H.A.				467,170
			Chicago Park Dist., Gen. Oblig.,
	1,000		5.00%, 1/1/27, Ser. A, A.M.B.A.C.				1,033,190
			Illinois Fin. Auth. Education Rev.,
	1,000		5.375%, 9/1/32, Ser. C., A.C.A.				855,170

							6,594,650


Principal Amount (000)			Description (a)			Value
			Indiana	5.8	%
			Indiana Mun. Pwr. Agcy., Pwr.
			Supply Sys. Rev.,
$	5,000		6.00%, 1/1/13, Ser. B, M.B.I.A.			$	5,622,400
			Indianapolis Local Pub. Impvt.
			Bond Bank Waterworks Proj. Rev.,
	2,100	(b)	5.25%, 7/1/33, Ser. A, M.B.I.A.
			Pre-refunded 7/1/12 @ $100				2,326,107

							7,948,507

			Kentucky	2.9	%
			Louisville & Jefferson Cnty. Met.
			Swr. Dist., Swr. & Drain Sys. Rev.,
	2,000		5.00%, 5/15/30, Ser. A, F.G.I.C.				2,017,480
			Louisville & Jefferson Cnty. Metro. Govt.
			Health Sys. Rev.,
	1,000		5.00%, 10/1/30				976,080
	1,000		5.25%, 10/1/36				994,050

							3,987,610

			Massachusetts	6.1	%
			Boston Wtr. & Swr. Comm. Rev.,
	2,000		5.00%, 11/1/28, Ser. D, F.G.I.C.				2,028,320
			Massachusetts St. Dev. Finance Agency,
			Solid Waste Disp. Rev.
	1,500		5.00%, 2/1/36				1,413,885
			Massachusetts St. Tpk. Auth.,
			Metro. Highway Sys. Rev.,
	2,355		5.125%, 1/1/23, Ser. B, M.B.I.A.				2,381,282
	2,500		4.75%, 1/1/34, Ser. A, A.M.B.A.C.				2,452,400

							8,275,887

			Michigan	3.8	%
			Detroit Wtr. Supply Sys. Rev.,
			Ser. A,
	2,000	(b)	5.50%, 7/1/24, F.G.I.C.
			Pre-refunded 7/1/11 @ $100				2,196,660
	2,000		5.00%, 7/1/30, F.G.I.C.				2,021,180
			Michigan Tobacco Settlement Finance Auth. Rev.,
	1,000		6.00%, 6/1/48, Ser. A				982,020

							5,199,860

			Nebraska	4.1	%
			Omaha Pub. Pwr. Dist.,
			Elec. Rev., Ser. B,
	2,500	(b)	6.15%, 2/1/12
			Escrowed to maturity				2,705,950
	2,500	(b)	6.20%, 2/1/17
			Escrowed to maturity				2,945,850

							5,651,800

			Nevada	3.3	%
			Las Vegas Valley Wtr. Dist.,
			Gen. Oblig.,
	1,400		5.00%, 6/1/25, Ser. B, M.B.I.A.				1,457,792
	3,000		5.00%, 6/1/32, Ser. A, F.G.I.C.				3,053,880

							4,511,672

			New Jersey	4.0	%
			New Jersey Econ. Dev. Auth. Rev.,
	1,025		4.95%, 3/1/47				938,880
			New Jersey St. Gen. Oblig.,
	2,000		5.25%, 7/1/17, Ser. H				2,277,800
			New Jersey Trans. Trust Fund Auth. Rev.,
	2,000		5.25%, 12/15/22, Ser. A				2,258,880

							5,475,560


Principal Amount (000)			Description (a)			Value
			New York	8.7	%
			Albany Industrial Dev. Agy. Rev.,
$	1,000		5.00%, 4/1/32, Ser. A			$	878,970
			Long Island Pwr. Auth. Elec.
			Sys. Rev.,
	4,000	(b)	5.25%, 12/1/26, Ser. A, M.B.I.A.
			Pre-refunded 6/1/08 @ $101				4,082,560
	800		5.00%, 12/1/35, Ser. B				821,336
			Metro. Trans. Auth. Rev.,
	1,000		5.25%, 11/15/31, Ser. A, F.G.I.C.				1,034,480
			New York City Mun. Wtr. Fin. Auth.,
			Wtr. & Swr. Sys. Rev.,
	5,000		5.00%, 6/15/29, Ser. B, F.S.A.				5,141,000

							11,958,346

			Ohio	6.2	%
			Buckeye Tobacco Settlement Financing Auth.,
	3,000		6.00%, 6/1/42, Ser. A-2				2,931,480
			Deerfield Twp. Tax Increment Rev.,
	750		5.00%, 12/1/25				750,503
			Hamilton Elec. Sys. Rev.
	1,000		4.60%, 10/15/20, Ser. A, F.S.A.				1,049,760
			Ohio St. Air Quality Dev. Auth. Rev.,
	1,000		4.80%, 9/1/36, Ser. A, F.G.I.C.				950,180
			Ohio St. Wtr. Dev. Auth. Rev.,
	2,445		5.50%, 6/1/20, Ser. B, F.S.A.				2,860,577

							8,542,500

			Pennsylvania	3.2	%
			Delaware Cnty. Auth. Rev.,
	2,000		5.00%, 6/1/21, Ser. A, Radian				2,080,760
			East Stroudsburg Area Sch. Dist., Gen. Oblig.
	1,000		7.75%, 9/1/27, Ser. A, F.G.I.C.				1,282,500
			Pennsylvania Economic Dev. Fin.
			Auth. Res. Recov. Rev.,
	1,000		4.625%, 12/1/18, Ser. F, A.M.B.A.C.				992,040

							4,355,300

			Puerto Rico	0.8	%
			Puerto Rico Elec. Pwr. Auth. Rev.,
	1,000		5.00%, 7/1/25, Ser. PP, F.G.I.C.				1,018,080

			South Carolina	1.3	%
			Spartanburg Waterworks Rev.,
	1,500	(b)	5.25%, 6/1/28, F.G.I.C.
			Pre-refunded 6/1/14 @ $100				1,702,830

			Tennessee	1.1	%
			Tennessee Energy Acquisition Corp. Rev.,
	1,500		5.25%, 9/1/20, Ser. A				1,561,275

			Texas	18.7	%
			Alliance Airport Auth. Inc. Rev.,
	1,000		4.85%, 4/1/21				968,340
			Bexar Met. Wtr. Dist.
			Waterworks Sys. Rev.,
	2,500		5.00%, 5/1/25, M.B.I.A.				2,557,825
			Coastal Wtr. Auth. Contract Rev.,
	4,000		5.00%, 12/15/25, F.S.A.				4,057,560
			Dallas Gen. Oblig.
	2,000		4.50%, 2/15/23				2,017,600
			El Paso Wtr. & Swr. Rev.,
	1,555		5.50%, 3/1/12, Ser. A, F.S.A.				1,723,064
			Harris Cnty. Gen. Oblig.,
	1,650		7.00%, 8/15/10, Ser. A				1,836,928
			Houston Wtr. & Swr. Sys. Rev.,
	1,500	(b)	5.25%, 12/1/23, Ser. B, F.G.I.C.
			Pre-refunded 12/1/10 @ $100				1,618,215
	3,500	(b)	5.00%, 12/1/28, Ser. A, F.S.A.
			Pre-refunded 12/1/09 @ $100				3,678,920
			Lower Colorado River Auth. Rev.,
	2,000		5.00%, 5/15/31, F.S.A.				2,031,340


Principal Amount (000)			Description (a)			Value
			Texas (continued)
			San Antonio Elec. & Gas Rev.,
$	2,595		5.00%, 2/1/18, Ser. A			$	2,666,259
	1,405	(b)	5.00%, 2/1/18, Ser. A
			Pre-refunded 2/1/09 @ 101				1,459,121
			University North Texas Rev.,
	1,000		4.50%, 4/15/25, F.G.I.C.				977,210

							25,592,382

			Virginia	4.1	%
			Henrico Cnty. Wtr. & Swr. Rev.,
	3,985		5.00%, 5/1/28				4,124,116
			Virginia St. Hsg. Dev. Auth. Rev.,
	1,500		4.55%, 1/1/24				1,456,920

							5,581,036

			Washington	2.2	%
			Energy Northwest Wind Proj. Rev.,
	500		4.75%, 7/1/21, M.B.I.A.				509,255
			King Cnty. Swr. Rev.,
	2,500		5.00%, 1/1/31, F.G.I.C.				2,534,475

							3,043,730

			West Virginia	1.1	%
			Monongalia Cnty. Building Commission
			Hospital Rev.
	1,500		5.00%, 7/1/30, Ser. A				1,441,305

			Wyoming	3.3	%
			Wyoming St. Farm Loan Brd.
			Cap. Facs. Rev.,
	4,000		5.75%, 10/1/20				4,534,880

			Total long-term investments (cost $182,646,395)				198,318,616


Shares
			SHORT-TERM INVESTMENT	0.3	%
	478,944		Goldman Sachs Tax Exempt Money Market Fund (cost $478,944)			$	478,944

	Total Investments (cost $183,125,339)			145.2	%		198,797,560
	Other assets in excess of liabilities			2.3	%		3,091,506
	Liquidation value of remarketed preferred stock			(47.5	%)		(65,000,000	)

	Net Assets Applicable to Common Stock			100.0	%	$	136,889,066

	Net asset value per share of common stock ($136,889,066 / 8,507,456)					$	16.09

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

A.C.A. - ACA Financial Guaranty Corporation.

A.M.B.A.C. - Ambac Assurance Corporation.

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

F.H.A. - Federal Housing Authority.

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

M.B.I.A. - MBIA Insurance Corporation.

Radian - Radian Asset Assurance Inc.

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

(c)	Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A to qualified institutional buyers. At January 31, 2008, these securities amounted to a value of $3,524,500 or 2.6% of net assets applicable to common stock.

Notes

Securities Valuation:

Fixed income securities are valued at the mean of bid and ask prices provided by an independent pricing service when such prices are believed to reflect the fair market value of such securities. Such bid and ask prices are determined taking into account securities prices, yields, maturities, call features, ratings, and institutional size trading in similar securities and developments related to specific securities. Any securities for which it is determined that market prices are unavailable or inappropriate are valued at a fair value using a procedure determined in good faith by the Board of Directors. Short-term investments having a maturity of 60 days or less at date of purchase are valued on an amortized cost basis, which approximates market value.

The United States federal income tax basis of the Fund's investments and the net unrealized appreciation as of January 31, 2008 were as follows:


Tax Basis of Investment		Appreciation		Depreciation		Net Unrealized Appreciation
$	182,500,052	$	17,270,892	$	973,384	$	16,297,508

Other information regarding the Fund is available in the Fund's most recent Report to Shareholders. This information is available on the Securities and Exchange Commission's website (www.SEC.gov)

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 Exchange Act.

(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 most recent 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 of 2002 – 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.


(Registrant)		DTF TAX-FREE INCOME INC.

By (Signature and Title)		/s/ ALAN M. MEDER
		Alan M. Meder Treasurer (Principal Financial and Accounting Officer)

Date		March 26, 2008

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 (Signature and Title)		/s/ NATHAN I. PARTAIN
		Nathan I. Partain President and Chief Executive Officer

Date		March 26, 2008

By (Signature and Title)		/s/ ALAN M. MEDER
		Alan M. Meder Treasurer (Principal Financial and Accounting Officer)

Date		March 26, 2008