VAN KAMPEN AMERICAN CAPITAL U S GOVERNMENT TRUST FOR INCOME, N-30D, 1997-11-25

VAN KAMPEN AMERICAN CAPITAL U S GOVERNMENT TRUST FOR INCOME
N-30D, 1997-11-25

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<PAGE>

Van Kampen American Capital

U.S. GOVERNMENT
TRUST FOR INCOME

Annual Report
September 30, 1997

--A Wealth of Knowledge . A Knowledge of Wealth--
VAN KAMPEN AMERICAN CAPITAL

<PAGE>

Table of Contents

<S> <C>

Letter to Shareholders......................... 1

Performance Results............................ 3

Portfolio Highlights........................... 4

Performance in Perspective..................... 5

Portfolio Management Review.................... 6

Glossary of Terms.............................. 8

Portfolio of Investments....................... 9

Statement of Assets and Liabilities............ 10

Statement of Operations........................ 11

Statement of Changes in Net Assets............. 12

Financial Highlights........................... 13

Notes to Financial Statements.................. 16

Report of Independent Accountants.............. 24

GTI ANR 11/97
</TABLE>
<PAGE>

Letter to Shareholders

[PHOTO]
Dennis J. McDonnell and Don G. Powell

November 6, 1997

Dear Shareholder,

As you know, Van Kampen American Capital was acquired by Morgan Stanley
Group Inc., paving the way for the development of a preeminent global financial
services company. More recently, Morgan Stanley Group Inc. and Dean Witter,
Discover & Co. agreed to merge. The merger was completed on May 31, 1997,
creating the combined company of Morgan Stanley, Dean Witter, Discover & Co.
Additionally, we are very pleased to announce that Philip N. Duff, formerly the
chief financial officer of Morgan Stanley Group Inc., has joined Van Kampen
American Capital as president and chief executive officer. I will continue as
chairman of the firm. We are confident that the partnership of Van Kampen
American Capital and Morgan Stanley, Dean Witter, Discover & Co. will continue
to work to the benefit of our fund shareholders as we move into the next
century.

On August 4, 1997, the announcement of exchange privileges between Van
Kampen American Capital and Morgan Stanley retail funds opened the door to even
greater investment opportunities. We are proud to offer an expanded family of
mutual funds covering virtually every market and continent. In our view, the
rapid appreciation of U.S. stock prices in recent years has created a need for
investors to examine their portfolios carefully to ensure proper
diversification among domestic and foreign investments. The Morgan Stanley
retail funds, with their emphasis on global markets, can be valuable tools for
accomplishing this diversification.

Economic Review

Growth, stability, and confidence continued to characterize the U.S.
economic environment during the reporting period. After performing solidly
during the second half of 1996, the economy in the first quarter of 1997 grew at
its fastest pace since 1987. Meanwhile, consumer confidence soared to its
highest reading in 28 years, while unemployment fell to 4.9 percent in August,
one of the lowest levels since 1973. This number was unchanged through
September.

Despite the robust pace of economic activity, there was little evidence of
troublesome inflation. In fact, wholesale prices fell during each of the first
seven months of 1997, the longest stretch of consecutive monthly declines in 45
years. At the consumer level, prices rose by a mere 2.2 percent during the 12
months through September.

Several factors contributed to maintaining a stable rate of inflation. A
strong rally in the U.S. dollar made imported goods less expensive. At the same
time, continued moderation in the cost of employee benefit packages offset mild
upward pressure on wages. Also, a sharp acceleration in productivity gains
allowed employers to absorb higher worker salaries without raising prices.
Finally, health-care costs were unchanged during July, the first time since 1975
that consumer medical prices did not rise.

In March, the inflationary implications of the nation's low unemployment
rate caused the Federal Reserve Board to raise its target for a key lending rate
by one-quarter of a percentage point,

1 Continued on page two
<PAGE>

the first hike in short-term interest rates in two years. Signs that economic
growth slowed in the second quarter, however, led Fed policymakers to leave
rates unchanged through the most recent August and September meetings.

Market Review

Bond yields remained in a relatively narrow range during the reporting
period. For several weeks during the spring, it appeared that economic growth
was too robust and that inflation could reemerge. The Fed's interest rate
increase combined with inflation concerns pushed yields on long-term government
bonds up to 7.17 percent in April. When subsequent data showed signs of economic
deceleration during the second quarter, bond yields gradually fell to 6.4
percent at the end of September, down about one-half of a percentage point from
September 1996.

The decline in long-term interest rates helped generate solid returns in
the fixed-income market. The Merrill Lynch Domestic Master Bond Index gained
6.93 percent during the nine months through September, and 9.61 percent during
the 12-month reporting period. This is a market capitalization weighted index
that includes U.S. government, fixed-coupon domestic investment grade corporate
bonds, and mortgage pass-throughs. Reflecting the strong economy, corporate
bonds outperformed Treasury issues by more than 2 percent during the 12 months
ended in September. Within the government market, long-term maturities bettered
returns on intermediate-term issues by more than 5 percent over the fiscal year,
while Treasury bonds outperformed mortgage-backed securities by a small margin.

Outlook

We expect the pace of economic activity for the remainder of 1997 to
accelerate modestly from the relatively pedestrian rate that prevailed during
the second quarter. While we do not believe that economic growth will be rapid
enough to reignite inflation, some warning signs are present, including a tight
labor market and high consumer confidence. Additionally, an unusually powerful
El Nino weather pattern developing in the Pacific Ocean has the potential to
drive commodity prices significantly higher in coming months. We anticipate
that bond yields will stay within a relatively narrow range for the remainder of
1997.

We are fortunate to be experiencing a rare combination of sustained
economic growth and low inflation. Furthermore, investors have enjoyed a low
level of market volatility during the past few years. However, normal market
dynamics include both up and down movements, as evidenced by the volatility in
the market at the end of October. We encourage investors to focus on their long-
term investment goals instead of the inevitable short-term distractions that
ultimately have little impact on their plans.

A discussion with your portfolio management team in this report will
provide details of the key factors and strategies contributing to your Fund's
performance. Once again, we value your continued confidence in your investment
with Van Kampen American Capital.

Sincerely,

/s/ Don G. Powell /s/ Dennis J. McDonnell

Don G. Powell Dennis J. McDonnell
Chairman President
Van Kampen American Capital Van Kampen American Capital
Asset Management, Inc. Asset Management, Inc.

2
<PAGE>

Performance Results for the Period Ended September 30, 1997

Van Kampen American Capital U.S. Government Trust for Income

<TABLE>
<CAPTION> A Shares B Shares C Shares

Total Returns

One-year total return based on NAV /1/............. 8.09% 7.43% 7.43%

One-year total return /2/.......................... 3.01% 3.43% 6.43%

Life-of-Fund average annual total return /2/....... 4.31%/3/ 4.30%/3/ 3.87%

Commencement Date................................ 10/06/92 10/06/92 04/12/93

Distribution Rate and Yield

Distribution Rate /4/.............................. 6.45% 6.04% 6.04%

SEC Yield /5/...................................... 5.39% 4.89% 4.89%

</TABLE>

/1/Assumes reinvestment of all distributions for the period and does not include
payment of the maximum sales charge (4.75% for A shares) or contingent
deferred sales charge for early withdrawal (4% for B shares and 1% for C
shares).

/2/Standardized total return. Assumes reinvestment of all distributions for the
period and includes payment of the maximum sales charge (A shares) or
contingent deferred sales charge for early withdrawal (B and C shares).

/3/Total return from November 2, 1992 (date the Fund's investment strategy was
implemented) through the period end.

/4/Distribution rate represents the monthly annualized distributions of the
Fund at the end of the period and not the earnings of the Fund.

/5/SEC Yield is a standardized calculation prescribed by the Securities and
Exchange Commission for determining the amount of net income a portfolio
should theoretically generate for the 30-day period ending September 30,
1997.

See the Prior Performance section of the current prospectus. Past performance
does not guarantee future results. Investment return and net asset value will
fluctuate with market conditions. Fund shares, when redeemed, may be worth more
or less than their original cost.

U.S. Government securities are backed by the full faith and credit of the U.S.
Government, its agencies or Instrumentalities. The government backing applies
only to the timely payment of principal and interest on specific securities in
the Fund's portfolio, not to the shares of the Fund.

Market forecasts provided in this report may not necessarily come to pass.

3
<PAGE>

Portfolio Highlights

Van Kampen American Capital U.S. Government Trust for Income

Coupon Distribution as of September 30, 1997
<TABLE>
<CAPTION>

Percentage of Coupon Rate
Long-Term Investments

50% 6-6.99 11.2%

40% 7-7.99 17.3%

30% 8-8.99 35.7%

20% 9-9.99 7.9%

10% 10 or More 27.9%

Portfolio Composition by Sector as a Percentage of Long-Term Investments

As of September 30, 1997

<S> <C>
GNMA................................ 15.7% [PIE CHART APPEARS HERE]
FNMA................................ 11.3%
Treasury/Agency..................... 58.3%
CMO................................. 9.3%
FHLMC............................... 5.4%

As of March 31, 1997
<S> <C>
GNMA................................ 20.2% [PIE CHART APPEARS HERE]
FNMA................................ 16.4%
Treasury/Agency..................... 44.2%
CMO................................. 9.7%
FHLMC............................... 9.5%

</TABLE>

Duration

As of September 30, 1997 As of March 31, 1997
<S> <C> <C>
Duration 4.0 years 3.6 years

</TABLE>

4
<PAGE>

Putting Your Fund's Performance in Perspective

As you evaluate your progress toward achieving your financial goals, it is
important to track your investment portfolio's performance at regular intervals.
A good starting point is a comparison of your investment holdings to an
applicable benchmark, such as a broad-based market index.
Such a comparison can:
. Reflect the impact of favorable market trends or difficult market
conditions
. Help you evaluate the extent to which your fund's management team has
responded to the opportunities and challenges presented to them over the
period measured
For these reasons, you may find it helpful to review the chart below, which
compares your fund's performance to that of the Merrill Lynch Intermediate-Term
U.S. Government Index over time. As a broad-based unmanaged statistical
composite, this index does not reflect any commissions or fees which would be
incurred by an investor purchasing the securities it represents. Similarly, its
performance does not reflect any sales charges or other costs which would be
applicable to an actively managed portfolio, such as that of the Fund.

Growth of a Hypothetical $10,000 Investment
Van Kampen American Capital U.S. Government Trust for Income vs. Merrill
Lynch Intermediate-Term U.S. Government Index (November 2, 1992 through
September 30, 1997)

VKAC U.S.

<TABLE>
<S> <C> <C>
Nov 1992 $9,527 $10,000.00
$9,492 $9,957.80
$9,651 $10,085.66
$9,835 $10,268.91
$9,968 $10,423.87
$9,984 $10,464.11
$10,087 $10,547.30
$10,018 $10,519.24
$10,144 $10,665.35
$10,159 $10,668.39
$10,262 $10,849.04
Sep 1993 $10,297 $10,897.75
$10,320 $10,918.46
$10,254 $10,869.43
$10,297 $10,913.02
$10,447 $11,020.40
$10,244 $10,867.66
$9,970 $10,720.62
$9,858 $10,647.61
$9,839 $10,658.15
$9,831 $10,665.19
$10,014 $10,798.08
$10,019 $10,834.14
Sep 1994 $9,903 $10,747.36
$9,895 $10,751.23
$9,839 $10,698.23
$9,886 $10,737.28
$10,089 $10,912.83
$10,318 $11,123.88
$10,360 $11,188.74
$10,491 $11,316.29
$10,788 $11,636.09
$10,831 $11,714.16
$10,810 $11,723.42
$10,919 $11,819.67
Sep 1995 $10,989 $11,899.10
$11,098 $12,030.58
$11,265 $12,177.96
$11,419 $12,299.49
$11,494 $12,404.04
$11,288 $12,271.07
$11,202 $12,215.23
$11,116 $12,177.24
$11,083 $12,170.55
$11,202 $12,291.03
$11,224 $12,328.52
$11,219 $12,342.21
Sep 1996 $11,381 $12,449.94
$11,600 $12,702.94
$11,778 $12,857.91
$11,674 $12,790.92
$11,697 $12,839.27
$11,706 $12,854.55
$11,614 $12,790.15
$11,754 $12,933.66
$11,850 $13,033.25
$11,977 $13,146.24
$12,252 $13,390,37
$12,157 $13,335.87
Sep 1997 $12,301 $13,482.17

</TABLE>

The above chart reflects the performance of Class A shares of the Fund. The
performance of Class A shares will differ from that of other share classes of
the Fund because of the difference in sales charges and/or expenses paid by
shareholders investing in the different share classes. The Fund's performance
assumes reinvestment of all distributions and includes payment of the maximum
sales charge (4.75% for A shares).

While past performance is not indicative of future performance, the above
information provides a broader vantage point from which to evaluate the
discussion of the Fund's performance found in the following pages.

5
<PAGE>

Portfolio Management Review

Van Kampen American Capital U.S. Government Trust for Income

We recently spoke with the management team of the Van Kampen American Capital
U.S. Government Trust for Income about the key events a nd economic forces that
shaped the markets during the Fund's fiscal year. The team includes Ted V.
Mundy, portfolio manager, and Peter W. Hegel, chief investment officer for
fixed-income investments. The following excerpts reflect their views on the
Fund's performance during the 12-month period ended September 30, 1997.

Q How would you describe the market in which the Fund operated during its past
fiscal year?

A Over the last 12 months, domestic interest rates continued to fluctuate in a
relatively narrow range. As measured by the five-year Treasury note, this range
reached a low of 5.8 percent and a high of 6.8 percent. This environment of
reduced volatility benefited the mortgage securities sector, because homeowner
refinancing risks remained benign.
Early in the period, interest rates trended lower due to modest economic
activity during the third quarter of 1996, when rates reached their low point
for the fiscal year. However, it became apparent in early December that growth
was picking up. Interest rates reversed course, rising 70 basis points by the
end of January. Without much relief, rates continued to press higher in
anticipation of tightening monetary policy from the Federal Reserve Board. After
the Fed took action at the end of March with a 25 basis point increase, the
yield for the five-year Treasury peaked near 6.9 percent in mid-April. In the
wake of a robust first quarter and the Fed tightening, investors began to watch
for a second-quarter slowdown. This shift in sentiment proved accurate, as
interest rates subsequently headed lower.
After a brief correction in August, interest rates slid past 6.0 percent on
September 30. During the last month of the reporting period, market
participants embraced the absence of inflation in the economy and the resulting
increase in the attractiveness of fixed-income securities.

Q How did you position the Fund in reaction to market conditions?

A An overriding theme for our asset allocation decisions during the period was
the attractiveness of the mortgage sector in light of the reduced volatility in
the marketplace. We overweighted the Fund's holdings in mortgage-backed
investments throughout the fiscal year. In June, the portfolio held as much as
63 percent of its assets in the mortgage sector. Currently, the portfolio is
approximately 40 percent invested in mortgage-backed investments, with the
remainder in Treasury securities. In the face of increasingly narrow yield
spreads, we feel that mortgages now present a higher risk and that it is prudent
to reduce the exposure to them.
Among our Treasury holdings, we sought to capitalize on a flattening yield
curve in the falling interest rate environment by overweighting longer duration
Treasuries within the portfolio. We shifted holdings from two- and five-year
Treasuries to 30-year Treasury securities throughout the second and third
quarters. We have recently moved toward a more neutral position as we question
how much further the yield curve can flatten.
Over the course of the fiscal year, we adjusted the Fund's duration in
prudent increments, seeking to capitalize on the movement of interest rates.
Under normal conditions, we make adjustments when we feel there is value to be
captured; however, our objective of a consistent risk profile

6
<PAGE>

and a competitive dividend stream is always paramount. The Fund's duration is
currently 4.0 years, which we feel provides the base-line level of exposure to
changes in interest rates that investors generally seek in this type of fund.
For additional Fund portfolio highlights, please refer to page four.

Q How did the Fund perform during the reporting period?

A For the 12-month period ended September 30, 1997, the U.S. Government Trust
for Income generated a total return of 8.09 percent/1/ (Class A shares at net
asset value). Additionally, the Fund's Class A shares provided shareholders
with a competitive distribution rate of 6.45 percent/4/, based upon the maximum
offering price as of September 30, 1997, and a monthly dividend of $0.04625 per
share. By comparison, the Merrill Lynch Intermediate-Term Government Index
posted a total return of 7.82 percent for the same period. This broad-based
index attempts to measure the market performance of government securities with
maturities between one and 10 years. Please keep in mind that this unmanaged
index does not reflect any commissions or fees that would be paid by an investor
purchasing the securities it represents. For additional Fund performance
results, please refer to the chart on page three.

Q What is your outlook for the months ahead?

A Our expectations for the next several months will be guided largely by the
health of the economy. The current combination of positive economic growth, job
growth, and wage gains provides a supportive environment for the consumer.
Furthermore, continuing low interest rates may stimulate increased automobile
and housing demand. All of these factors paint a healthy economic picture. Our
concern is how much more positive this picture can get until inflation emerges.
Fortunately, inflation has been contained to date. We will continue to monitor
for changes on the horizon and adjust accordingly.
Our expectations for the Fund include positive price performance. As yields
trickle downward, we believe mortgage-backed investments will have difficulty
maintaining their competitive edge. As a result, we are moving the Fund toward a
slightly longer duration and a neutral position in the mortgage-backed sector.
Within this sector, we will focus on securities which we believe will perform
well in a falling rate environment.

/s/ Peter W. Hegel /s/ Ted V. Mundy
Peter W. Hegel Ted V. Mundy
Chief Investment Officer Portfolio Manager
Fixed Income Investments

7 Please see footnotes on page three
<PAGE>

Glossary of Terms

Basis point:
A measure used in quoting yields on bonds. One hundred basis points is
equal to one percent. For example, if a bond's yield changes from 7.00 to 6.65
percent, it would be a 35 basis point move.

Duration:
A measure of a bond's sensitivity to changes in interest rates, expressed
in years. The longer a fund's duration, the greater the effect of interest rate
movements on net asset value. Typically, funds with shorter durations have
performed better in rising rate environments, while funds with longer durations
have performed better when decline.

Federal funds rate:
The interest rate charged by one institution lending federal funds to
another. This overnight rate is used to meet banks' daily reserve requirements.
The Federal Reserve Board uses the federal funds rate to affect the direction of
interest rates.

Federal Reserve Board (Fed):
A seven-member group that directs the operations of the Federal Reserve
System, the central bank system of the United States. Currently led by Chairman
Alan Greenspan, the Fed meets eight times a year to regulate the flow of money
and credit.

Inflation:
An economic state in which the amount of money supply and business activity
dramatically increases, accompanied by sharply rising prices. Inflation is
widely measured by the Consumer Price Index, a leading economic indicator that
measures the change in the cost of purchased goods and services.

Mortgage-backed securities:
Securities backed by pools of similar mortgages. Investors receive interest
payments and partial repayment of the principal passed through from the
underlying mortgages (agencies pass on what they receive from homeowners paying
off their mortgages). These securities are generally issued by agencies of the
U.S. government, such as Government National Mortgage Association (GNMA, or
"Ginnie Mae") and Federal Home Loan Mortgage Corporation (FHLMC, or "Freddie
Mac").

Net asset value:
The value of a mutual fund share, calculated by deducting the fund's
liabilities from the total assets of the portfolio and dividing this amount by
the number of shares outstanding. The NAV is calculated daily, based on the
closing market price for each security in the fund's portfolio.

Yield:
A measure of a fund's net investment income per share, expressed as a
percentage of the maximum offering price of the fund's shares at the end of the
day.

Yield curve:
A result of viewing the yields of U.S. Treasury securities maturing in 1,
5, 10, and 30 years, grouped together, which often reflects a pattern of
increasing yield as maturity extends. This pattern creates an upward sloping
"curve." A "flat" yield curve represents little difference between short-and
long-term interest rates.

8
<PAGE>

Portfolio of Investments

September 30, 1997
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
Par
Amount
(000) Description Coupon Maturity Market Value
- ------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Collateralized Mortgage Obligations 9.2%
$ 2,368 Capstead Mortgage,
Series 93-2CA3........................ 9.709% 08/25/23 $ 2,406,001
4,444 Prudential Home Mortgage Securities,
Series 93-23A7........................ 10.000 06/25/08 4,614,602
8,817 Salomon Brothers Mortgage Securities,
Series 93-5A3 (a)..................... 7.363 10/25/03 8,913,958
------------
Total Collateralized Mortgage Obligations.......................... 15,934,561
------------
United States Government Agency Obligations 32.1%
9,475 Federal Home Loan Mortgage Corp.
Gold 30 Year Pool..................... 6.500 02/01/26 to 05/01/26 9,241,033
9,990 Federal National Mortgage Association
CMO, Series 94-87..................... 6.075 03/25/09 10,016,769
7,494 Federal National Mortgage Association
15 Year Pool.......................... 7.000 10/01/09 7,583,479
1,708 Federal National Mortgage Association
Pool.................................. 8.500 01/01/22 to 09/01/24 1,784,022
12,156 Government National Mortgage
Association Pool...................... 8.000 03/15/23 to 08/15/24 12,566,313
2,762 Government National Mortgage
Association Pool...................... 8.000 10/15/21 to 09/15/22 2,869,885
5,837 Government National Mortgage
Association Pool...................... 8.500 12/15/17 6,201,533
5,062 Government National Mortgage
Association Pool...................... 9.000 03/15/18 to 12/15/29 5,452,222
------------
Total United States Government Agency Obligations.................. 55,715,256
------------
United States Treasury Obligations 57.7%
12,500 United States Treasury Bonds (a)...... 10.750 08/15/05 16,031,250
11,500 United States Treasury Bonds (a)...... 7.625 02/15/25 13,174,745
22,000 United States Treasury Notes (a)...... 11.625 11/15/02 27,369,320
5,500 United States Treasury Notes (a)...... 9.250 08/15/98 5,664,120
27,500 United States Treasury Notes (a)...... 8.000 08/15/99 28,544,175
9,500 United States Treasury Notes (a)...... 8.750 10/15/97 9,510,355
------------
Total United States Treasury Obligations........................... 100,293,965
------------
Total Long-Term Investments 99.0%
(Cost $172,492,883)........................................................... 171,943,782
------------
Repurchase Agreement 0.3%
SBC Warburg ($660,000 par collateralized by U.S. Government obligations in a
pooled cash account, dated 09/30/97, to be sold on 10/01/97 at $660,111)... 660,000
------------
Total Investments 99.3%
(Cost $173,152,883)........................................................... 172,603,782
------------
Other Assets in Excess of Liabilities 0.7%...................................... 1,145,528
------------
Net Assets 100.0%............................................................... $173,749,310
============
</TABLE>

(a) Assets segregated as collateral for open futures and forwards transactions.

9 See Notes to Financial Statements
<PAGE>

Statement of Assets and Liabilities

September 30, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Assets:
Total Investments (Cost $173,152,883).......................... $ 172,603,782
Cash........................................................... 371
Receivables:
Interest..................................................... 2,385,711
Fund Shares Sold............................................. 27,205
Other........................................................ 44
Forward Commitments............................................ 182,459
Other.......................................................... 98
-------------
Total Assets............................................... 175,199,670
-------------

Liabilities:
Payables:
Income Distributions......................................... 581,353
Fund Shares Repurchased...................................... 503,367
Distributor and Affiliates................................... 175,213
Investment Advisory Fee...................................... 86,063
Variation Margin on Futures.................................. 11,784
Accrued Expenses............................................... 61,483
Trustees Deferred Compensation and Retirement Plans............ 31,097
-------------
Total Liabilities.......................................... 1,450,360
-------------
Net Assets..................................................... $ 173,749,310
=============

Net Assets Consist of:
Capital........................................................ $ 224,057,367
Accumulated Distributions in Excess of Net Investment Income... (108,311)
Net Unrealized Depreciation.................................... (410,480)
Accumulated Net Realized Loss.................................. (49,789,266)
-------------
Net Assets..................................................... $ 173,749,310
=============

Maximum Offering Price Per Share:
Class A Shares:
Net asset value and redemption price per share (Based on
net assets of $38,305,652 and 4,675,547 shares of
beneficial interest issued and outstanding)................ $ 8.19
Maximum sales charge (4.75%* of offering price)............ .41
-------------
Maximum offering price to public........................... $ 8.60
=============

Class B Shares:
Net asset value and offering price per share (Based on
net assets of $121,733,517 and 14,869,372 shares of
beneficial interest issued and outstanding)................ $ 8.19
=============

Class C Shares:
Net asset value and offering price per share (Based on
net assets of $13,710,141 and 1,674,790 shares of
beneficial interest issued and outstanding)................ $ 8.19
=============
</TABLE>

*On sales of $100,000 or more, the sales charge will be reduced.

10 See Notes to Financial Statements
<PAGE>
Statement of Operations

For the Year Ended September 30, 1997
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------
<S> <C>
Investment Income:
Interest........................................................ $ 15,210,057
Other Income.................................................... 465,664
------------
Total Income............................................... 15,675,721
------------
Expenses:
Distribution (12b-1) and Service Fees (Attributed to
Classes A, B and C of $102,267, $1,349,816 and
$157,579, respectively)...................................... 1,609,662
Investment Advisory Fee......................................... 1,154,038
Shareholder Services............................................ 315,399
Custody......................................................... 25,294
Legal........................................................... 17,298
Trustees Fees and Expenses...................................... 14,151
Amortization of Organizational Costs............................ 3,000
Other........................................................... 280,141
------------
Total Expenses............................................. 3,418,983
Less Expenses Reimbursed................................... 1,300
------------
Net Expenses............................................... 3,417,683
------------
Net Investment Income........................................... $ 12,258,038
============
Realized and Unrealized Gain/Loss:
Realized Gain/Loss:
Investments................................................ $ (2,015,612)
Futures.................................................... 158,512
Forward Commitments........................................ (238,770)
------------
Net Realized Loss............................................... (2,095,870)
------------
Unrealized Appreciation/Depreciation:
Beginning of the Period....................................... (4,183,278)
------------
End of the Period:
Investments................................................ (549,101)
Futures.................................................... (43,838)
Forward Commitments........................................ 182,459
------------
(410,480)
------------
Net Unrealized Appreciation During the Period................... 3,772,798
------------
Net Realized and Unrealized Gain................................ $ 1,676,928
============
Net Increase in Net Assets From Operations...................... $ 13,934,966
============
</TABLE>
11 See Notes to Financial Statements

<PAGE>

Statement of Changes in Net Assets

For the Years Ended September 30, 1997 and 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended Year Ended
September 30, 1997 September 30, 1996
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
From Investment Activities:
Operations:
Net Investment Income............................................... $ 12,258,038 $ 15,824,780
Net Realized Loss................................................... (2,095,870) (3,776,806)
Net Unrealized Appreciation/Depreciation During the Period.......... 3,772,798 (4,230,410)
------------- -------------
Change in Net Assets from Operations................................ 13,934,966 7,817,564
------------- -------------

Distributions from Net Investment Income:
Class A Shares.................................................... (2,842,739) (3,792,860)
Class B Shares.................................................... (8,230,537) (10,629,590)
Class C Shares.................................................... (961,509) (1,389,674)
------------- -------------
(12,034,785) (15,812,124)
------------- -------------

Net Change in Net Assets from Investment Activities................. 1,900,181 (7,994,560)
------------- -------------

From Capital Transactions:
Proceeds from Shares Sold........................................... 7,421,625 14,763,888
Net Asset Value of Shares Issued Through Dividend Reinvestment...... 4,910,254 6,411,519
Cost of Shares Repurchased.......................................... (55,107,596) (97,053,619)
------------- -------------

Net Change in Net Assets from Capital Transactions.................. (42,775,717) (75,878,212)
------------- -------------
Total Decrease in Net Assets........................................ (40,875,536) (83,872,772)

Net Assets:
Beginning of the Period............................................. 214,624,846 298,497,618
------------- -------------

End of the Period (Including accumulated distributions in excess of
net investment income of $108,311 and $5,046, respectively........ $ 173,749,310 $ 214,624,846
============= =============
</TABLE>

12 See Notes to Financial Statements
<PAGE>

Financial Highlights

The following schedule presents financial highlights for one share of the
Fund outstanding throughout the periods indicated.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
October 6, 1992
(Commencement
of Investment
Year Ended September 30, Operations) to
--------------------------------- September 30,
Class A Shares 1997 1996 1995 1994 1993 (a)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of the
Period..................................... $8.108 $8.38 $8.17 $9.26 $9.43
------ ----- ----- ----- -----
Net Investment Income...................... .567 .565 .63 .67 .81
Net Realized and Unrealized
Gain/Loss............................. .073 (.274) .23 (1.0085) (.1795)
------ ------ ----- ------- ------
Total from Investment Operations................... .640 .291 .86 (.3385) .6305
------ ----- ----- ------ -----
Less:
Distributions from Net Investment
Income................................ .555 .563 .645 .674 .8005
Distributions from Net Realized
Gain.................................. -0- -0- .005 .0775 -0-
------ ----- ----- ----- -----
Total Distributions................................ .555 .563 .65 .7515 .8005
------ ----- ----- ----- -----
Net Asset Value, End of the Period................. $8.193 $8.108 $8.38 $ 8.17 $9.26
====== ===== ===== ===== =====
Total Return (b)................................... 8.09% 3.57% 10.97% (3.82%) 8.07%(c)
Net Assets at End of the Period
(In millions)................................. $38.3 $45.2 $70.2 $75.3 $92.4
Ratio of Expenses to Average Net
Assets (d).................................... 1.18% 1.13% 1.09% 1.07% 1.07%
Ratio of Net Investment Income to
Average Net Assets (d)........................ 6.95% 6.83% 7.67% 7.89% 8.71%
Portfolio Turnover................................. 82% 282% 262% 122% 281%*
</TABLE>

*Non-Annualized

(a) Based on average month-end shares outstanding.

(b) Total return is based upon net asset value which does not include payment of
the maximum sales charge or contingent deferred sales charge.

(c) Total return from November 2, 1992 (date the Fund's investment strategy was
implemented) through September 30, 1993 without annualization.

(d) For the year ended September 30, 1997, the impact of expenses reimbursed by
VKAC was less than 0.01% of average net assets. For the period ended
September 30, 1993, the ratios of expenses and net investment income to
average net assets would have been 1.15% and 8.64%, respectively, had VKAC
not reimbursed certain expenses of the Fund.

13 See Notes to Financial Statements
<PAGE>

Financial Highlights (Continued)
The following schedule presents financial highlights for one share of the Fund
outstanding throughout the periods indicated.
- ------------------------------------------------------------------------------

<TABLE>
<CAPTION>
October 6, 1992
(Commencement
of Investment
Year Ended September 30, Operations) to
------------------------------------- September 30,
Class B Shares 1997 1996 1995 1994 1993(a)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of the
Period............................................ $8.104 $8.38 $8.17 $9.26 $9.43
------ ------ ------ ------- ------
Net Investment Income............................. .505 .504 .57 .61 .70
Net Realized and Unrealized
Gain/Loss...................................... .073 (.277) .228 (1.0205) (.1475)
------ ------ ------ ------- ------
Total from Investment Operations...................... .578 .227 .798 (.4105) .5525
------ ------ ------ ------- ------
Less:
Distributions from Net Investment
Income......................................... .495 .503 .583 .602 .7225
Distributions from Net Realized Gain.............. -0- -0- .005 .0775 -0-
------ ------ ------ ------- ------
Total Distributions................................... .495 .503 .588 .6795 .7225
------ ------ ------ ------- ------
Net Asset Value, End of the Period.................... $8.187 $8.104 $8.38 $8.17 $9.26
====== ====== ====== ======= ======
Total Return (b)...................................... 7.43% 2.70% 10.14% (4.61%) 7.24%(c)
Net Assets at End of the Period
(In millions)..................................... $121.7 $150.8 $200.2 $226.7 $242.8
Ratio of Expenses to
Average Net Assets (d)............................ 1.94% 1.89% 1.85% 1.82% 1.81%
Ratio of Net Investment Income to
Average Net Assets (d)............................ 6.20% 6.08% 6.92% 7.11% 7.70%
Portfolio Turnover.................................... 82% 282% 262% 122% 281%*

</TABLE>

*Non-Annualized

(a) Based on average month-end shares outstanding.

(b) Total return is based upon net asset value which does not include payment of
the maximum sales charge or contingent deferred sales charge.

(c) Total return from November 2, 1992 (date the Fund's investment strategy was
implemented) through September 30, 1993 without annualization.

(d) For the year ended September 30, 1997, the impact of expenses reimbursed by
VKAC was less than 0.01% of average net assets. For the period ended
September 30, 1993, the ratios of expenses and net investment income to
average net assets would have been 1.89% and 7.62%, respectively, had VKAC
not reimbursed certain expenses of the Fund.

14 See Notes to Financial Statements
<PAGE>

Financial Highlights (Continued)

Less:
Distributions from Net Investment
Income.......................... .495 .503 .583 .602 .3339
Distributions from Net Realized
Gain............................ -0- -0- .005 .0775 -0-
------ ------ ------ -------- -------
Total Distributions................. .495 .503 .588 .6795 .3339
------ ------ ------ -------- -------
Net Asset Value, End of the Period.. $8.186 $8.104 $ 8.38 $ 8.17 $ 9.25
====== ====== ====== ======== =======
Total Return (b).................... 7.43% 2.70% 10.14% (4.51%) 2.10%*

Net Assets at End of the Period
(In millions)................... $ 13.7 $ 18.6 $ 28.1 $ 37.5 $ 37.8

Ratio of Expenses to Average Net
Assets (c)...................... 1.94% 1.89% 1.85% 1.82% 1.76%

Ratio of Net Investment Income to
Average Net Assets (c).......... 6.20% 6.08% 6.94% 7.08% 7.26%

Portfolio Turnover.................. 82% 282% 262% 122% 281%*
</TABLE>

*Non-Annualized

(a) Based on average month-end shares outstanding.

(b) Total return is based upon net asset value which does not include payment
of the maximum sales charge or contingent deferred sales charge.

(c) For the year ended September 30, 1997, the impact of expenses reimbursed by
VKAC was less than 0.01% of average net assets. For the period ended
September 30, 1993, the ratios of expenses and net investment income to
average net assets would have been 1.83% and 7.18%, respectively, had VKAC
not reimbursed certain expenses of the Fund.

15 See Notes to Financial Statements
<PAGE>

Notes to Financial Statements

September 30, 1997
- --------------------------------------------------------------------------------

1. Significant Accounting Policies

Van Kampen American Capital U.S. Government Trust for Income (the "Fund") is
organized as a Delaware business trust, and is registered as a diversified open-
end management investment company under the Investment Company Act of 1940, as
amended. The Fund's investment objective is to seek a high level of income by
primarily investing in debt securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. The Fund commenced investment
operations on October 6, 1992 with two classes of common shares, Class A and
Class B shares. The distribution of the Fund's Class C shares commenced on
April 12, 1993.

The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

A. Security Valuation-Investments are stated at value using market quotations.
For those securities where quotations or prices are not available, valuations
are determined in accordance with procedures established in good faith by the
Board of Trustees. Short-term securities with remaining maturities of 60 days
or less are valued at amortized cost.

B. Security Transactions-Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis.
The Fund may purchase and sell securities on a "when issued" or "delayed
delivery" basis, with settlement to occur at a later date. The value of the
security so purchased is subject to market fluctuations during this period. The
Fund will maintain, in a segregated account with its custodian, assets having
an aggregate value at least equal to the amount of the when issued or delayed
delivery purchase commitments until payment is made. At September 30, 1997,
there were no when issued or delayed delivery purchase commitments.

The Fund may invest in repurchase agreements, which are short-term
investments in which the Fund acquires ownership of a debt security and the
seller agrees to repurchase the security at a future time and specified price.
The Fund may invest independently in repurchase agreements, or transfer
uninvested cash balances into a pooled cash account along with other investment
companies advised by Van Kampen American Capital Asset Management, Inc. (the
"Adviser") or its affiliates, the daily aggregate of which is invested in
repurchase agreements. Repurchase agreements are fully collateralized by the
underlying debt security. The Fund will make payment for such securities only
upon physical delivery or evidence of book entry transfer to the account of the
custodian
16
<PAGE>

Notes to Financial Statements (Continued)

September 30, 1997
- --------------------------------------------------------------------------------

bank. The seller is required to maintain the value of the underlying security at
not less than the repurchase proceeds due the Fund.

C. Investment Income-Interest income is recorded on an accrual basis. Original
issue discount is amortized over the expected life of each applicable security.
Premiums on debt securities are not amortized.

D. Organizational Costs-The Fund has reimbursed Van Kampen American Capital
Distributors, Inc. or its affiliates (collectively "VKAC") for costs incurred
in connection with the Fund's organization in the amount of $15,000. These costs
were amortized on a straight line basis over the 60 month period ending
September 30, 1997.

E. Federal Income Taxes-It is the Fund's policy to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no provision for federal income taxes is required.

At September 30, 1997, for federal income tax purposes, cost of long- and
short-term investments is $173,152,883, the aggregate gross unrealized
appreciation is $2,279,257 and the aggregate gross unrealized depreciation is
$2,689,737, resulting in net unrealized depreciation including open futures
transactions and forward commitments of $410,480.

The Fund intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset these losses against any future realized capital
gains. At September 30, 1997, the Fund had an accumulated capital loss
carryforward for tax purposes of $48,680,382 which will expire between September
30, 2003 and September 30, 2005. Net realized loss differs for financial and tax
reporting purposes as a result of post October 31 losses which are not
recognized for tax purposes until the first day of the following fiscal year and
losses recognized for tax purposes on open futures positions at September 30,
1997.

F. Distribution of Income and Gains-The Fund declares daily and pays monthly
dividends from net investment income. Net realized gains, if any, are
distributed annually. Distributions from net realized gains for book purposes
may include short-term capital gains and gains on futures transactions. All
short-term capital gains and a portion of futures gains are included in ordinary
income for tax purposes.

Permanent book and tax basis differences relating to the recognition of
gains/losses on paydowns of mortgage pool obligations totaling $371,860 were
reclassified to accumulated distributions in excess of net investment income
from accumulated net realized gain/loss. Permanent

17
<PAGE>

Notes to Financial Statements (Continued)

September 30, 1997
- --------------------------------------------------------------------------------

differences relating to certain expenses which are not deductible for tax
purposes totaling $45,342 were reclassified from accumulated distributions in
excess of net investment income to capital.

Due to inherent differences in the recognition of distributions from income
under generally accepted accounting principles and federal income tax purposes,
the amount of distributable net investment income may differ between book and
federal income tax purposes for a particular period. These differences are
temporary in nature, but may result in distributions in excess of net investment
income for certain periods.

2. Investment Advisory Agreement and Other Transactions with Affiliates

Under the terms of the Fund's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Fund for an annual fee, payable
monthly, of .60% of the Fund's average daily net assets.

For the year ended September 30, 1997, the Fund recognized expenses of
approximately $17,300 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom (Illinois), counsel to the Fund, of which a trustee of the
Fund is an affiliated person.

For the year ended September 30, 1997, the Fund recognized expenses of
approximately $43,300 representing VKAC's cost of providing accounting services
to the Fund. These services are provided by VKAC at cost.

ACCESS Investor Services, Inc. ("ACCESS"), an affiliate of the Adviser,
serves as the shareholder servicing agent for the Fund. For the year ended
September 30, 1997, the Fund recognized expenses of approximately $218,000,
representing ACCESS' cost of providing transfer agency and shareholder services
plus a profit.

Additionally, for the year ended September 30, 1997, the Fund paid VKAC
approximately $17,500 related to the direct cost of consolidating the VKAC
open-end fund complex. Payment was contingent upon the realization by the
Fund of cost efficiencies in shareholder servicing resulting from the
consolidation.

Certain officers and trustees of the Fund are also officers and directors
of VKAC. The Fund does not compensate its officers or trustees who are officers
of VKAC.

The Fund provides deferred compensation and retirement plans for its
trustees who are not officers of VKAC. Under the deferred compensation plan,
trustees may elect to defer all or a portion of their compensation to a later
date. Benefits under the retirement plan are payable for a ten-year period and
are based upon each trustee's years of service to the Fund. The maximum annual
benefit per Trustee under the plan is equal to $2,500. During the year ended
September 30, 1997, VKAC reimbursed the Fund for expenses related to the
retirement plan.

At September 30, 1997, VKAC owned 5,302 shares each of Classes A and B,
respectively, and 53 shares of Class C.

18
<PAGE>

Notes to Financial Statements (Continued)

September 30, 1997
- --------------------------------------------------------------------------------

3. Capital Transactions

The Fund has outstanding three classes of shares of beneficial interest, Classes
A, B and C, each with a par value of $.01 per share. There are an unlimited
number of shares of each class authorized.

At September 30, 1997, capital aggregated $49,648,102, $154,776,176 and
$19,633,089 for Classes A, B and C, respectively. For the year ended September
30, 1997, transactions were as follows:

<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------------------
<S> <C> <C>
Sales:
Class A...................................... 414,895 $ 3,387,293
Class B...................................... 419,235 3,415,948
Class C...................................... 76,387 618,384
---------- -------------
Total Sales.................................... 910,517 $ 7,421,625
========== =============

Dividend Reinvestment:
Class A...................................... 141,435 $ 1,152,447
Class B...................................... 404,778 3,295,398
Class C...................................... 56,785 462,409
---------- -------------
Total Dividend Reinvestment.................... 602,998 $ 4,910,254
========== =============

Repurchases:
Class A...................................... (1,456,979) $ (11,854,279)
Class B...................................... (4,563,587) (37,123,144)
Class C...................................... (753,064) (6,130,173)
---------- -------------
Total Repurchases.............................. (6,773,630) $ (55,107,596)
========== =============
</TABLE>

19
<PAGE>

Notes to Financial Statements (Continued)

September 30, 1997
- --------------------------------------------------------------------------------

At September 30, 1996, capital aggregated $56,972,639, $185,219,741 and
$24,686,046 for Classes A, B and C, respectively. For the year ended September
30, 1996, transactions were as follows:

<TABLE>
<CAPTION>
Shares Value
- -------------------------------------------------------------------------------
<S> <C> <C>
Sales:
Class A...................................... 549,325 $ 4,588,334
Class B...................................... 953,675 7,950,236
Class C...................................... 266,808 2,225,318
----------- -------------
Total Sales.................................... 1,769,808 $ 14,763,888
=========== =============

Dividend Reinvestment:
Class A...................................... 182,960 $ 1,516,218
Class B...................................... 509,206 4,213,922
Class C...................................... 82,271 681,379
----------- -------------
Total Dividend Reinvestment.................... 774,437 $ 6,411,519
=========== =============

Repurchases:
Class A...................................... (3,531,939) $ (29,385,104)
Class B...................................... (6,746,410) (55,996,788)
Class C...................................... (1,403,810) (11,671,727)
----------- -------------
Total Repurchases.............................. (11,682,159) $ (97,053,619)
=========== =============
</TABLE>

Class B and C shares are offered without a front end sales charge, but are
subject to a contingent deferred sales charge (CDSC). The CDSC will be imposed
on most redemptions made within five years of the purchase for Class B and one
year of the purchase for Class C as detailed in the following schedule. The
Class B and C shares bear the expense of their respective deferred sales
arrangements, including higher distribution and service fees and incremental
transfer agency costs.

<TABLE>
<CAPTION>
Contingent Deferred
Sales Charge
-------------------
Year of Redemption Class B Class C
- -------------------------------------------------------------------------------
<S> <C> <C>
First.................................................... 4.00% 1.00%
Second................................................... 4.00% None
Third.................................................... 3.00% None
Fourth................................................... 2.50% None
Fifth.................................................... 1.50% None
Sixth and Thereafter..................................... None None
</TABLE>

20
<PAGE>

Notes to Financial Statements (Continued)

September 30, 1997
- --------------------------------------------------------------------------------
For the year ended September 30, 1997, VKAC, as Distributor for the Fund,
received commissions on sales of the Fund's Class A shares of approximately
$4,300 and CDSC on redeemed shares of approximately $451,000. Sales charges do
not represent expenses of the Fund.

4. Investment Transactions

During the period, the cost of purchases and proceeds from sales of investments,
excluding short-term investments and forward commitment transactions, were
$155,460,730 and $208,060,615, respectively.

5. Derivative Financial Instruments

A derivative financial instrument in very general terms refers to a security
whose value is "derived" from the value of an underlying asset, reference rate
or index.
The Fund has a variety of reasons to use derivative instruments, such as to
attempt to protect the Fund against possible changes in the market value of its
portfolio or generate potential gain. All of the Fund's portfolio holdings,
including derivative instruments, are marked to market each day with the change
in value reflected in unrealized appreciation/depreciation. Upon disposition, a
realized gain or loss is recognized accordingly, except when taking delivery of
a security underlying a futures contract or forward commitment. In these
instances, the recognition of gain or loss is postponed until the disposal of
the security underlying the futures contract or forward commitment.
Summarized below are the specific types of derivative financial instruments
used by the Fund.

A. Futures Contracts--A futures contract is an agreement involving the delivery
of a particular asset on a specified future date at an agreed upon price. The
Fund generally invests in exchange traded futures contracts on U.S. Treasury
Bonds and typically closes the contract prior to the delivery date. These
contracts are generally used to manage the portfolio's effective maturity and
duration.
Upon entering into futures contracts, the Fund maintains, in a segregated
account with its custodian, securities with a value equal to its obligation
under the futures contracts. During the period the futures contract is open,
payments are received from or made to the broker based upon changes in the
value of the contract (the variation margin).

21
<PAGE>

Notes to Financial Statements (Continued)
September 30, 1997
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------

Transactions in futures contracts, each with a par value of $100,000, for
the year ended September 30, 1997, were as follows:

Contracts
- -------------------------------------------------------------------------------
Outstanding at September 30, 1996.................................. 150
Futures Opened..................................................... 3,576
Futures Closed..................................................... (3,601)
---------
Outstanding at September 30, 1997.................................. 125
=========

The futures contracts outstanding as of September 30, 1997, and the
descriptions and unrealized depreciation are as follows:

Unrealized
Contracts Depreciation
- -------------------------------------------------------------------------------
<S> <C> <C>
U.S. Treasury Long Bond Future, Long Contract
Dec. 1997--(Current Notional Value of $116,200
per contract).................................... 15 $ 13,782
10-Year U.S. Treasury Note Future, Long Contract
Dec. 1997--(Current Notional Value of $110,276
per contract).................................... 55 8,348
5-Year U.S. Treasury Note Future, Short Contract
Dec. 1997--(Current Notional Value of $107,012
per contract).................................... 55 21,708
-------- ---------
125 $ 43,838
======== =========
</TABLE>

22
<PAGE>

Notes to Financial Statements (Continued)
September 30, 1997
- --------------------------------------------------------------------------------
B. Forward Commitments--The Fund trades certain securities under the terms of
forward commitments, whereby the settlement occurs at a specific future date.
Forward commitments are privately negotiated transactions between the Fund and
dealers. While forward commitments are outstanding, the Fund maintains
sufficient collateral of cash or securities in a segregated account with its
custodian. Forward commitments are marked to market on a daily basis with
changes in value reflected as a component of unrealized appreciation/depreci-
ation. The following forward commitments were outstanding as of September 30,
1997:

Par Amount Current Unrealized
(000) Description Value Appreciation
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Long Contracts
$25,000 U.S. T-Note, 5.75% $24,984,375 $ 0
9,000 FHLMC Gold, 30 Yr., 7.00% 8,980,290 59,040
5,000 FHLMC Gold, 15 Yr., 7.50% 5,112,900 21,494
6,000 FNMA Balloon, 7 Yr., 6.50% 5,988,780 11,280
9,000 FNMA, 7.50% 9,151,920 84,420
Short Contracts
10,000 GNMA, 8.00% 10,337,500 4,688
5,000 FNMA Dwarf, 15 Yr., 7.50% 5,115,650 1,537
---------
$ 182,459
=========
</TABLE>

6. Distribution and Service Plans

The Fund and its shareholders have adopted a distribution plan pursuant to Rule
12b-1 under the Investment Company Act of 1940 and a service plan (collectively
the "Plans"). The Plans govern payments for the distribution of the Fund's
shares, ongoing shareholder ser vices and maintenance of shareholder accounts.
Annual fees under the Plans of up to .25% of Class A net assets and 1.00%
each of Class B and Class C net assets are accrued daily. Included in these fees
for the year ended September 30, 1997, are payments to VKAC of approximately
$1,012,900.

23
<PAGE>

Report of Independent Accountants

To the Shareholders and Board of Trustees of
Van Kampen American Capital U.S. Government Trust for Income

In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Van Kampen American Capital U.S.
Government Trust for Income (the "Fund") at September 30, 1997, and the results
of its operations, the changes in its net assets and the financial highlights
for each of the periods presented, in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at September 30, 1997 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion expressed
above.

PRICE WATERHOUSE LLP

Chicago, Illinois
November 14, 1997

24
<PAGE>

Funds Distributed by Van Kampen American Capital

GLOBAL AND
INTERNATIONAL
Global Equity Fund
Global Government Securities Fund
Global Managed Assets Fund
Short-Term Global Income Fund
Strategic Income Fund

EQUITY
Growth
Aggressive Growth Fund
Emerging Growth Fund
Enterprise Fund
Growth Fund
Pace Fund

Growth & Income
Comstock Fund
Equity Income Fund
Growth and Income Fund
Harbor Fund
Real Estate Securities Fund
Utility Fund

FIXED INCOME
Corporate Bond Fund
Government Securities Fund
High Income Corporate Bond Fund
High Yield Fund
Limited Maturity Government Fund
Prime Rate Income Trust
Reserve Fund
U.S. Government Fund
U.S. Government Trust for Income

TAX-FREE
California Insured Tax Free Fund
Florida Insured Tax Free Income Fund
High Yield Municipal Fund
Insured Tax Free Income Fund
Intermediate Term Municipal Income Fund
Municipal Income Fund
New Jersey Tax Free Income Fund
New York Tax Free Income Fund
Pennsylvania Tax Free Income Fund
Tax Free High Income Fund
Tax Free Money Fund

MORGAN STANLEY
FUND, INC.
Aggressive Equity Fund
American Value Fund
Asian Growth Fund
Emerging Markets Fund
Global Equity Fund
Global Equity Allocation Fund
Global Fixed Income Fund
High Yield Fund
International Magnum Fund
Latin American Fund
U.S. Real Estate Fund
Value Fund
Worldwide High Income Fund

Ask your investment representative for a prospectus containing more complete
information, including sales charges and expenses. Please read it carefully
before you invest or send money. Or call us weekdays from 7:00 a.m. to 7:00 p.m.
Central time at 1-800-341-2911 for Van Kampen American Capital funds or Morgan
Stanley retail funds.

25
<PAGE>

Results of Shareholder Votes

A Special Meeting of Shareholders of the Trust was held on May 28, 1997,
where shareholders voted on a new investment advisory agreement, the election of
Trustees and independent public accountants.

1) With regard to the approval of a new investment advisory agreement
between Van Kampen American Capital Asset Management, Inc. and the Trust,
15,873,592 shares voted for the proposal, 196,956 shares voted against and
636,702 shares abstained.

2) With regard to the election of the following Trustees:

<TABLE>
<CAPTION>
# of Shares
-----------------------
In Favor Against
- -------------------------------------------------------------------------------
<S> <C> <C>
J. Miles Branagan 16,387,536 319,714
Richard M. DeMartini 16,388,804 318,446
Linda Hutton Heagy 16,386,751 320,499
R. Craig Kennedy 16,387,289 319,961
Jack E. Nelson 16,390,613 316,637
Jerome L. Robinson 16,392,763 314,488
Philip B. Rooney 16,387,536 319,714
Fernando Sisto 16,383,763 323,720
Wayne W. Whalen 16,392,763 314,488
</TABLE>

3) With regard to the ratification of Price Waterhouse LLP as independent
public accountants for its current fiscal year, 15,792,310 shares voted for the
proposal, 148,253 shares voted against and 766,687 shares abstained.

26
<PAGE>

Van Kampen American Capital U.S. Government Trust for Income

Board of Trustees

J. Miles Branagan
Richard M. DeMartini*
Linda Hutton Heagy
R. Craig Kennedy
Jack E. Nelson
Jerome L. Robinson
Phillip B. Rooney
Fernando Sisto
Wayne W. Whalen* -- Chairman

Officers

Dennis J. McDonnell*

President
Ronald A. Nyberg*

Vice President and Secretary
Edward C. Wood, III*

Vice President and Chief Financial Officer
Curtis W. Morell*

Vice President and Chief Accounting Officer
John L. Sullivan*

Treasurer
Tanya M. Loden*

Controller
Peter W. Hegel*
Alan T. Sachtleben*
Paul R. Wolkenberg*
Vice Presidents

Investment Adviser

Van Kampen American Capital
Asset Management, Inc.
One Parkview Plaza
Oakbrook Terrace, Illinois 60181

Distributor

Van Kampen American Capital
Distributors, Inc.
One Parkview Plaza
Oakbrook Terrace, Illinois 60181

Shareholder Servicing Agent

ACCESS Investor
Services, Inc.
P.O. Box 418256
Kansas City, Missouri 64141-9256

Custodian

State Street Bank
and Trust Company
225 Franklin Street.
P.O. Box 1713
Boston, Massachusetts 02105

Legal Counsel

Skadden, Arps, Slate,
Meagher & Flom (Illinois)
333 West Wacker Drive
Chicago, Illinois 60606

Independent Accountants

Price Waterhouse LLP
200 E. Randolph
Chicago, Illinois 60601

* "Interested" persons of the Fund, as defined in the Investment Company Act
of 1940.

SM denotes a service mark of Van Kampen American Capital Distributors, Inc.

This report is submitted for the general information of the shareholders of the
Fund. It is not authorized for distribution to prospective investors unless it
has been preceded or is accompanied by an effective prospectus of the Fund which
contains additional information on how to purchase shares, the sales charge, and
other pertinent data. After March 31, 1998, the report must be accompanied by a
quarterly performance update, if applicable.

27
<PAGE>

Van Kampen American Capital U.S. Government Trust for Income

This Page Intentionally Left Blank

28
<PAGE>

----------------
Van Kampen American Capital Distributors, Inc. Bulk Rate
One Parkview Plaza U.S. Postage
Oakbrook Terrace, Illinois 60181 PAID
VAN KAMPEN
AMERICAN CAPITAL
----------------