Edgar Filing: EVERGREEN INCOME ADVANTAGE FUND

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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 811-21269

Evergreen Income Advantage Fund

(Exact name of registrant as specified in charter)

200 Berkeley Street

Boston, Massachusetts 02116

(Address of principal executive offices) (Zip code)

Michael H. Koonce, Esq.

200 Berkeley Street

Boston, Massachusetts 02116

(Name and address of agent for service)

Registrant’s telephone number, including area code: (617) 210-3200

Date of fiscal year end:

Registrant is making a quarterly filing for one of its series, Evergreen Income Advantage Fund, for the quarter ended January 31, 2009. This series has April 30 fiscal year end.

Date of reporting period: January 31, 2009

Item 1 – Schedule of Investments

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS



January 31, 2009 (unaudited)
	Principal Amount		Value


CORPORATE BONDS 126.3%
CONSUMER DISCRETIONARY 20.4%
Auto Components 1.3%
Cooper Standard Automotive, Inc.:
7.00%, 12/15/2012	$	680,000	$	214,200
8.375%, 12/15/2014		1,520,000		281,200
Cooper Tire & Rubber Co., 7.625%, 03/15/2027		6,380,000		2,520,100
Goodyear Tire & Rubber Co.:
7.86%, 08/15/2011		2,405,000		2,272,725
9.00%, 07/01/2015		1,210,000		1,122,275


				6,410,500


Automobiles 1.9%
Ford Motor Co.:
5.54%, 04/15/2009		7,404,000		7,080,075
7.70%, 05/15/2097		12,420,000		2,049,300


				9,129,375


Diversified Consumer Services 0.4%
Carriage Services, Inc., 7.875%, 01/15/2015		2,290,000		1,923,600
Service Corporation International, 6.75%, 04/01/2015		110,000		101,200


				2,024,800


Hotels, Restaurants & Leisure 3.7%
Boyd Gaming Corp., 7.75%, 12/15/2012		235,000		209,150
Caesars Entertainment, Inc.:
7.875%, 03/15/2010		4,169,000		2,355,485
8.125%, 05/15/2011		1,350,000		533,250
Fontainebleau Las Vegas Holdings, LLC, 10.25%, 06/15/2015 144A		2,738,000		314,870
Inn of the Mountain Gods Resort & Casino, 12.00%, 11/15/2010		2,350,000		481,750
Isle of Capri Casinos, Inc., 7.00%, 03/01/2014		1,243,000		621,500
MGM MIRAGE, 8.50%, 09/15/2010		1,165,000		943,650
Pinnacle Entertainment, Inc., 8.75%, 10/01/2013		145,000		134,125
Pokagon Gaming Authority, 10.375%, 06/15/2014 144A		1,844,000		1,622,720
Seneca Gaming Corp., 7.25%, 05/01/2012		2,920,000		2,350,600
Shingle Springs Tribal Gaming Authority, 9.375%, 06/15/2015 144A		5,300,000		3,286,000
Six Flags, Inc.:
8.875%, 02/01/2010 ρ		815,000		232,275
9.625%, 06/01/2014		775,000		158,875
12.25%, 07/15/2016 144A		329,000		195,755
Trump Entertainment Resorts, Inc., 8.50%, 06/01/2015 •		4,516,000		688,690
Universal City Development Partners, Ltd., 11.75%, 04/01/2010		5,275,000		4,074,937


				18,203,632


Household Durables 5.5%
Centex Corp., 5.80%, 09/15/2009		3,810,000		3,714,750
D.R. Horton, Inc.:
4.875%, 01/15/2010		1,685,000		1,592,325
6.00%, 04/15/2011		285,000		249,375
9.75%, 09/15/2010		4,385,000		4,209,600
Hovnanian Enterprises, Inc.:
6.00%, 01/15/2010 ρ		2,185,000		1,802,625
8.00%, 04/01/2012		1,375,000		522,500
11.50%, 05/01/2013		475,000		393,063
Lennar Corp.:
5.125%, 10/01/2010		5,415,000		4,480,912
7.625%, 03/01/2009		1,630,000		1,597,400
Libbey, Inc., FRN, 9.57%, 06/01/2011		4,960,000		2,207,200

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2009 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
CONSUMER DISCRETIONARY continued
Household Durables continued
Meritage Homes Corp.:
6.25%, 03/15/2015	$	2,136,000	$	1,324,320
7.00%, 05/01/2014		3,050,000		1,997,750
Pulte Homes, Inc.:
7.875%, 08/01/2011		1,555,000		1,461,700
8.125%, 03/01/2011		1,177,000		1,112,265


				26,665,785


Internet & Catalog Retail 0.3%
Ticketmaster Entertainment, Inc., 10.75%, 08/01/2016 144A		2,565,000		1,551,825


Media 3.3%
Charter Communications, Inc.:
8.00%, 04/30/2012 144A		685,000		585,675
10.875%, 09/15/2014 144A		7,285,000		6,337,950
CSC Holdings, Inc.:
7.625%, 04/01/2011		25,000		25,000
8.50%, 04/15/2014 144A		810,000		799,875
DirectTV Holdings, LLC, 7.625%, 05/15/2016		110,000		108,625
Idearc, Inc., 8.00%, 11/15/2016		8,610,000		312,112
Ion Media Networks, Inc., FRN, 11.00%, 01/15/2013 144A		5,105,093		255,255
Lamar Media Corp.:
7.25%, 01/01/2013		440,000		364,100
Ser. B, 6.625%, 08/15/2015		1,015,000		766,325
Mediacom, LLC, 7.875%, 02/15/2011		1,440,000		1,360,800
R.H. Donnelley Corp., 11.75%, 05/15/2015 144A		4,597,000		1,379,100
Sinclair Broadcast Group, Inc., 8.00%, 03/15/2012		3,544,000		2,525,100
Sirius Satellite Radio, Inc., 9.625%, 08/01/2013		2,270,000		510,750
XM Satellite Radio Holdings, Inc., 13.00%, 08/01/2013 144A		2,270,000		578,850
Young Broadcasting, Inc.:
8.75%, 01/15/2014 •		4,739,000		35,542
10.00%, 03/01/2011 •		3,455,000		25,913


				15,970,972


Multiline Retail 0.4%
Macy’s, Inc., 7.875%, 07/15/2015		1,320,000		1,013,280
Neiman Marcus Group, Inc., 9.00%, 10/15/2015		1,610,000		724,500


				1,737,780


Specialty Retail 1.6%
American Achievement Corp., 8.25%, 04/01/2012 144A		7,545,000		6,073,725
AutoZone, Inc., 6.50%, 01/15/2014		85,000		83,123
Best Buy, Inc., 6.75%, 07/15/2013		910,000		827,423
Staples, Inc., 9.75%, 01/15/2014		820,000		872,991


				7,857,262


Textiles, Apparel & Luxury Goods 2.0%
AAC Group Holdings Corp., Step Bond, 10.25%, 10/01/2012 ††		1,055,000		685,750
Oxford Industries, Inc., 8.875%, 06/01/2011		7,288,000		5,502,440
Visant Corp., 7.625%, 10/01/2012		3,940,000		3,565,700


				9,753,890


CONSUMER STAPLES 2.0%
Beverages 0.5%
Anheuser-Busch InBev, 7.75%, 01/15/2019 144A		2,470,000		2,509,942

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2009 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
CONSUMER STAPLES continued
Food Products 1.0%
Dean Foods Co., 6.625%, 05/15/2009	$	65,000	$	65,000
Del Monte Foods Co.:
6.75%, 02/15/2015		675,000		637,875
8.625%, 12/15/2012		2,946,000		3,004,920
Tyson Foods, Inc., 7.35%, 04/01/2016		1,370,000		1,132,712


				4,840,507


Personal Products 0.0%
Central Garden & Pet Co., 9.125%, 02/01/2013		200,000		141,000


Tobacco 0.5%
Altria Group, Inc., 9.70%, 11/10/2018		2,070,000		2,268,855


ENERGY 21.0%
Energy Equipment & Services 3.2%
Bristow Group, Inc., 7.50%, 09/15/2017		3,085,000		2,267,475
GulfMark Offshore, Inc., 7.75%, 07/15/2014		3,130,000		2,457,050
Hornbeck Offshore Services, Inc., Ser. B, 6.125%, 12/01/2014		7,635,000		5,478,113
Parker Drilling Co., 9.625%, 10/01/2013		2,350,000		1,750,750
PHI, Inc., 7.125%, 04/15/2013		5,195,000		3,350,775


				15,304,163


Oil, Gas & Consumable Fuels 17.8%
Chesapeake Energy Corp.:
7.50%, 09/15/2013		8,500,000		7,820,000
9.50%, 02/15/2015		2,790,000		2,748,150
Delta Petroleum Corp., 7.00%, 04/01/2015		4,450,000		1,624,250
El Paso Corp.:
6.75%, 05/15/2009		810,000		810,034
7.00%, 06/15/2017		95,000		87,400
7.42%, 02/15/2037		2,960,000		2,160,800
12.00%, 12/12/2013		815,000		878,163
Encore Acquisition Co., 6.00%, 07/15/2015		4,320,000		3,477,600
Exco Resources, Inc., 7.25%, 01/15/2011		6,721,000		5,679,245
Ferrellgas Partners, LP, 6.75%, 05/01/2014 144A		3,685,000		2,966,425
Forest Oil Corp.:
7.25%, 06/15/2019		3,560,000		2,981,500
7.25%, 06/15/2019 144A		2,410,000		2,018,375
Frontier Oil Corp., 6.625%, 10/01/2011		2,140,000		2,054,400
Inergy Holdings, LP, 8.75%, 03/01/2015 144A		1,595,000		1,515,250
Newfield Exploration Co.:
6.625%, 04/15/2016		3,205,000		2,852,450
7.125%, 05/15/2018		3,680,000		3,266,000
Peabody Energy Corp.:
5.875%, 04/15/2016		6,915,000		6,258,075
7.875%, 11/01/2026		2,015,000		1,722,825
Petrohawk Energy Corp.:
7.875%, 06/01/2015 144A		7,365,000		6,205,012
10.50%, 08/01/2014 144A		1,235,000		1,182,512
Plains Exploration & Production Co., 7.625%, 06/01/2018		3,385,000		2,911,100
Quicksilver Resources, Inc., 8.25%, 08/01/2015		980,000		793,800
Range Resources Corp.:
7.25%, 05/01/2018		425,000		387,813
7.50%, 10/01/2017		470,000		438,275
Sabine Pass LNG, LP:
7.25%, 11/30/2013		2,530,000		1,891,175
7.50%, 11/30/2016		7,855,000		5,822,519
SandRidge Energy, Inc., 8.00%, 06/01/2018 144A		895,000		711,525

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2009 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
ENERGY continued
Oil, Gas & Consumable Fuels continued
Southwestern Energy Co., 7.50%, 02/01/2018 144A	$	1,025,000	$	973,750
Stallion Oilfield Services, Ltd., 9.75%, 02/01/2015 144A		720,000		154,800
Tennessee Gas Pipeline, 8.00%, 02/01/2016 144A		820,000		817,950
Tesoro Corp.:
6.50%, 06/01/2017		6,685,000		5,013,750
6.625%, 11/01/2015		100,000		79,125
Williams Cos.:
7.50%, 01/15/2031		5,520,000		4,509,547
8.125%, 03/15/2012		3,700,000		3,681,500


				86,495,095


FINANCIALS 20.3%
Capital Markets 2.4%
E*TRADE Financial Corp.:
8.00%, 06/15/2011		110,000		51,150
12.50%, 11/30/2017 144A		3,001,562		1,680,875
12.50%, 11/30/2017		1,394,375		780,850
Goldman Sachs Group, Inc.:
6.15%, 04/01/2018		3,537,000		3,235,237
7.50%, 02/15/2019		1,080,000		1,070,788
Lehman Brothers Holdings, Inc., 6.875%, 05/02/2018 •		410,000		59,450
Morgan Stanley:
6.625%, 04/01/2018		4,370,000		4,005,686
FRN, 1.57%, 10/15/2015		905,000		620,678


				11,504,714


Consumer Finance 12.2%
CCH II Capital Corp., 10.25%, 09/15/2010 ρ		2,745,000		1,660,725
Ford Motor Credit Co., LLC:
5.70%, 01/15/2010		12,140,000		10,287,278
9.75%, 09/15/2010		6,392,000		5,277,459
General Electric Capital Corp.:
5.625%, 05/01/2018		815,000		752,885
5.875%, 01/14/2038		1,690,000		1,348,142
6.15%, 08/07/2037		1,210,000		996,460
6.875%, 01/10/2039		2,150,000		1,910,548
GMAC, LLC:
5.625%, 05/15/2009		1,165,000		1,117,724
6.75%, 12/01/2014 144A		574,000		373,453
6.875%, 09/15/2011 144A		9,670,000		7,617,339
6.875%, 08/28/2012 144A		5,597,000		4,005,157
7.00%, 02/01/2012 144A		167,000		121,930
7.50%, 12/31/2013 144A		1,815,000		1,071,685
7.75%, 01/19/2010		5,085,000		4,400,844
8.00%, 12/31/2018 144A		2,387,000		943,701
FRN, 3.40%, 05/15/2009		11,605,000		10,865,181
International Lease Finance Corp.:
4.375%, 11/01/2009		670,000		611,611
4.75%, 07/01/2009		790,000		760,957
4.75%, 01/13/2012		105,000		77,667
4.875%, 09/01/2010		2,285,000		1,898,243
5.00%, 04/15/2010		100,000		87,093
5.125%, 11/01/2010		155,000		126,654
5.75%, 06/15/2011		1,301,000		1,010,587
6.375%, 03/15/2009		828,000		819,317
Sprint Capital Corp., 6.875%, 11/15/2028		2,485,000		1,413,011


				59,555,651

EVERGREEN INCOME ADVANTAGE FUND
SCHEDULE OF INVESTMENTS continued

January 31, 2009 (unaudited)

	Principal Amount		Value


CORPORATE BONDS continued
FINANCIALS continued
Diversified Financial Services 2.1%
Fresenius Finance II, Inc., 9.00%, 07/15/2015 144A	$	220,000	$	222,750
Leucadia National Corp.:
7.125%, 03/15/2017		825,000		610,500
8.125%, 09/15/2015		11,430,000		9,315,450


				10,148,700


Real Estate Investment Trusts (REITs) 3.0%
Host Marriott Corp.:
7.125%, 11/01/2013		2,080,000		1,809,600
Ser. O, 6.375%, 03/15/2015		45,000		36,225
Ser. Q, 6.75%, 06/01/2016		2,185,000		1,758,925
Omega Healthcare Investors, Inc.:
7.00%, 04/01/2014		5,495,000		5,082,875
7.00%, 01/15/2016		905,000		809,975
Ventas, Inc.:
6.75%, 04/01/2017		2,438,000		2,047,920
7.125%, 06/01/2015		2,480,000		2,201,000
9.00%, 05/01/2012		985,000		985,000


				14,731,520


Thrifts & Mortgage Finance 0.6%
Residential Capital, LLC, 8.50%, 05/15/2010 144A ρ		4,110,000		2,918,100


HEALTH CARE 5.7%
Health Care Equipment & Supplies 0.1%
Biomet, Inc., 11.625%, 10/15/2017		250,000		233,750
Universal Hospital Services, Inc., 8.50%, 06/01/2015		189,000		160,650


				394,400


Health Care Providers & Services 5.6%
HCA, Inc.:
7.875%, 02/01/2011		2,929,000		2,789,873
8.75%, 09/01/2010		2,165,000		2,137,938
9.25%, 11/15/2016		7,625,000		7,300,937
9.625%, 11/15/2016		6,545,000		5,514,162
Humana, Inc., 7.20%, 06/15/2018		3,560,000		2,997,605
Omnicare, Inc., 6.125%, 06/01/2013		6,890,000		6,304,350
Symbion, Inc., 11.00%, 08/23/2015		743,929		305,011


				27,349,876


INDUSTRIALS 13.4%
Aerospace & Defense 4.9%
Alliant Techsystems, Inc., 6.75%, 04/01/2016		1,990,000		1,920,350
DAE Aviation Holdings, 11.25%, 08/01/2015 144A		135,000		47,925
L-3 Communications Holdings, Inc.:
5.875%, 01/15/2015		19,675,000		18,101,000
6.375%, 10/15/2015		1,516,000		1,428,830
Sequa Corp.:
11.75%, 12/01/2015 144A		130,000		52,650
13.50%, 12/01/2015 144A		820,293		291,204
Vought Aircraft Industries, Inc., 8.00%, 07/15/2011		3,205,000		1,971,075


				23,813,034


Building Products 0.2%
Ply Gem Industries, Inc., 11.75%, 06/15/2013		1,425,000		798,000

EVERGREEN INCOME ADVANTAGE FUND
SCHEDULE OF INVESTMENTS continued

January 31, 2009 (unaudited)

	Principal Amount		Value


CORPORATE BONDS continued
INDUSTRIALS continued
Commercial Services & Supplies 3.9%
Allied Waste North America, Inc., 6.875%, 06/01/2017	$	990,000	$	961,796
Browning-Ferris Industries, Inc.:
7.40%, 09/15/2035		5,170,000		4,717,578
9.25%, 05/01/2021		3,715,000		3,837,398
Corrections Corporation of America, 6.75%, 01/31/2014		170,000		164,050
Geo Group, Inc., 8.25%, 07/15/2013		785,000		694,725
Mobile Mini, Inc., 6.875%, 05/01/2015		4,285,000		3,063,775
Toll Corp.:
8.25%, 02/01/2011		5,760,000		5,616,000
8.25%, 12/01/2011		5,000		4,850


				19,060,172


Machinery 1.5%
Commercial Vehicle Group, Inc., 8.00%, 07/01/2013		15,831,000		7,203,105


Road & Rail 2.2%
Kansas City Southern:
8.00%, 06/01/2015		9,665,000		8,746,825
13.00%, 12/15/2013		2,040,000		2,121,600


				10,868,425


Trading Companies & Distributors 0.7%
United Rentals, Inc., 6.50%, 02/15/2012		3,975,000		3,279,375


INFORMATION TECHNOLOGY 4.8%
Communications Equipment 0.4%
EchoStar Corp.:
6.625%, 10/01/2014		1,675,000		1,528,438
7.125%, 02/01/2016		685,000		633,625


				2,162,063


Electronic Equipment, Instruments & Components 3.4%
Da-Lite Screen Co., Inc., 9.50%, 05/15/2011		3,655,000		3,271,225
Jabil Circuit, Inc., 8.25%, 03/15/2018		15,830,000		12,189,100
Sanmina-SCI Corp., 8.125%, 03/01/2016		1,925,000		837,375


				16,297,700


IT Services 0.5%
iPayment, Inc., 9.75%, 05/15/2014		2,850,000		1,724,250
Unisys Corp., 6.875%, 03/15/2010		1,289,000		818,515


				2,542,765


Semiconductors & Semiconductor Equipment 0.5%
Spansion, Inc.:
11.25%, 01/15/2016 144A •		1,791,000		71,640
FRN, 5.33%, 06/01/2013 144A •		8,430,000		2,170,725


				2,242,365


MATERIALS 12.9%
Chemicals 4.1%
Airgas, Inc., 7.125%, 10/01/2018 144A		125,000		115,312
Huntsman, LLC:
7.375%, 01/01/2015		1,000,000		515,000
11.625%, 10/15/2010		3,880,000		3,734,500
Koppers Holdings, Inc., Sr. Disc. Note, Step Bond, 0.00%, 11/15/2014 †		5,555,000		4,617,594
Lubrizol Corp., 8.875%, 02/01/2019		885,000		907,898
MacDermid, Inc., 9.50%, 04/15/2017 144A		1,791,000		886,545

EVERGREEN INCOME ADVANTAGE FUND
SCHEDULE OF INVESTMENTS continued

January 31, 2009 (unaudited)

	Principal Amount		Value


CORPORATE BONDS continued
MATERIALS continued
Chemicals continued
Momentive Performance Materials, Inc.:
9.75%, 12/01/2014	$	1,350,000	$	600,750
10.875%, 12/01/2014		2,224,809		745,311
11.50%, 12/01/2016		465,000		116,250
Mosaic Co.:
7.30%, 01/15/2028		3,155,000		2,719,739
7.625%, 12/01/2016 144A		4,665,000		4,391,398
Tronox Worldwide, LLC, 9.50%, 12/01/2012 •		5,285,000		766,325


				20,116,622


Construction Materials 1.9%
CPG International, Inc.:
10.50%, 07/01/2013		9,700,000		5,480,500
FRN, 8.56%, 07/01/2012		2,095,000		1,162,725
CRH America, Inc., 8.125%, 07/15/2018		1,265,000		962,072
Texas Industries, Inc., 7.25%, 07/15/2013 144A		2,355,000		1,789,800


				9,395,097


Containers & Packaging 2.2%
Berry Plastics Holdings Corp., 8.875%, 09/15/2014		1,286,000		636,570
Exopack Holding Corp., 11.25%, 02/01/2014		8,370,000		4,896,450
Graham Packaging Co., 8.50%, 10/15/2012		3,865,000		2,976,050
Graphic Packaging International, Inc., 8.50%, 08/15/2011		2,365,000		2,093,025


				10,602,095


Metals & Mining 2.8%
Freeport-McMoRan Copper & Gold, Inc.:
6.875%, 02/01/2014		1,030,000		953,727
8.25%, 04/01/2015		1,820,000		1,551,046
8.375%, 04/01/2017		12,040,000		10,007,010
Indalex Holdings Corp., 11.50%, 02/01/2014		5,985,000		822,938


				13,334,721


Paper & Forest Products 1.9%
Georgia Pacific Corp.:
8.125%, 05/15/2011		1,970,000		1,910,900
8.875%, 05/15/2031		160,000		122,400
International Paper Co., 7.95%, 06/15/2018		6,520,000		5,287,511
Verso Paper Holdings, LLC:
9.125%, 08/01/2014		1,810,000		751,150
11.375%, 08/01/2016		3,675,000		1,047,375


				9,119,336


TELECOMMUNICATION SERVICES 9.9%
Diversified Telecommunication Services 4.8%
Citizens Communications Co.:
7.875%, 01/15/2027		1,760,000		1,313,400
9.25%, 05/15/2011		5,680,000		5,751,000
FairPoint Communications, Inc., 13.125%, 04/01/2018 144A		865,000		488,725
Qwest Corp.:
6.50%, 06/01/2017		2,665,000		2,251,925
7.50%, 06/15/2023		1,725,000		1,285,125
7.875%, 09/01/2011		1,045,000		1,039,775
8.875%, 03/15/2012		10,225,000		10,225,000
West Corp., 9.50%, 10/15/2014		1,335,000		914,475


				23,269,425

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2009 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
TELECOMMUNICATION SERVICES continued
Wireless Telecommunication Services 5.1%
Centennial Communications Corp., 8.125%, 02/01/2014	$	6,605,000	$	6,803,150
Cricket Communications, Inc., 9.375%, 11/01/2014		1,450,000		1,326,750
MetroPCS Communications, Inc.:
9.25%, 11/01/2014 144A		1,830,000		1,688,175
9.25%, 11/01/2014		6,520,000		6,071,750
Sprint Nextel Corp.:
6.90%, 05/01/2019		4,120,000		2,764,825
Ser. D, 7.375%, 08/01/2015		5,965,000		2,804,826
Ser. E, 6.875%, 10/31/2013		7,040,000		3,416,146


				24,875,622


UTILITIES 15.9%
Electric Utilities 12.4%
Allegheny Energy Supply Co., 8.25%, 04/15/2012 144A		8,870,000		8,936,525
Aquila, Inc., Step Bond, 11.875%, 07/01/2012 ††		18,294,000		19,222,055
CMS Energy Corp., 8.50%, 04/15/2011		860,000		870,344
Edison Mission Energy, 7.00%, 05/15/2017		140,000		130,900
Energy Future Holdings Corp.:
10.875%, 11/01/2017		270,000		214,650
11.25%, 11/01/2017		5,055,000		2,957,175
Mirant Americas Generation, LLC, 8.50%, 10/01/2021		395,000		337,725
Mirant Mid-Atlantic, LLC, Ser. C, 10.06%, 12/30/2028		4,959,159		4,599,619
Mirant North America, LLC, 7.375%, 12/31/2013		4,390,000		4,258,300
NRG Energy, Inc., 7.375%, 02/01/2016		10,190,000		9,731,450
Orion Power Holdings, Inc., 12.00%, 05/01/2010		8,070,000		8,271,750
Public Service Company of New Mexico, 7.95%, 04/01/2015		1,050,000		935,506


				60,465,999


Independent Power Producers & Energy Traders 3.3%
AES Corp.:
8.00%, 10/15/2017		275,000		259,875
8.00%, 06/01/2020 144A		1,330,000		1,216,950
Dynegy Holdings, Inc., 7.50%, 06/01/2015		395,000		316,000
Reliant Energy, Inc.:
6.75%, 12/15/2014		13,328,000		12,361,720
7.625%, 06/15/2014		1,400,000		1,151,500
7.875%, 06/15/2017		703,000		572,945


				15,878,990


Multi-Utilities 0.2%
PNM Resources, Inc., 9.25%, 05/15/2015		920,000		832,600


Total Corporate Bonds (cost $771,961,815)				613,625,855


YANKEE OBLIGATIONS – CORPORATE 8.1%
ENERGY 2.7%
Energy Equipment & Services 0.8%
Forbes Energy Services, Ltd., 11.00%, 02/15/2015		6,390,000		3,865,950


Oil, Gas & Consumable Fuels 1.9%
Connacher Oil & Gas, Ltd., 10.25%, 12/15/2015 144A		3,145,000		1,195,100
Griffin Coal Mining Co., Ltd.:
9.50%, 12/01/2016 144A		11,801,000		4,189,355
9.50%, 12/01/2016		1,460,000		528,315
OPTI Canada, Inc.:
7.875%, 12/15/2014		1,310,000		589,500
8.25%, 12/15/2014		3,830,000		1,780,950

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2009 (unaudited)
	Principal Amount		Value


YANKEE OBLIGATIONS – CORPORATE continued
ENERGY continued
Oil, Gas & Consumable Fuels continued
TransCanada Pipelines, Ltd.:
7.125%, 01/15/2019	$	260,000	$	276,078
7.625%, 01/15/2039		825,000		861,212


				9,420,510


FINANCIALS 1.5%
Consumer Finance 0.2%
Petroplus Finance, Ltd., 7.00%, 05/01/2017 144A		315,000		229,950
Virgin Media Finance plc, 9.125%, 08/15/2016		940,000		794,300


				1,024,250


Diversified Financial Services 1.3%
FMG Finance Property, Ltd.:
10.625%, 09/01/2016 144A		6,086,500		3,986,658
FRN:
6.20%, 09/01/2011 144A		630,000		447,300
6.20%, 09/01/2011		785,000		557,350
Preferred Term Securities XII, Ltd., FRN, 3.50%, 12/24/2033 + •		1,540,000		10,395
Ship Finance International, Ltd., 8.50%, 12/15/2013		1,400,000		1,100,750


				6,102,453


INDUSTRIALS 1.3%
Road & Rail 1.3%
Kansas City Southern de Mexico:
7.375%, 06/01/2014		3,444,000		2,979,060
9.375%, 05/01/2012		3,680,000		3,523,600


				6,502,660


INFORMATION TECHNOLOGY 0.2%
Electronic Equipment, Instruments & Components 0.2%
Celestica, Inc., 7.875%, 07/01/2011		895,000		850,250


MATERIALS 1.4%
Metals & Mining 1.4%
Evraz Group SA:
8.875%, 04/24/2013 144A		330,000		206,250
9.50%, 04/24/2018 144A		275,000		166,375
Novelis, Inc., 7.25%, 02/15/2015		7,070,000		3,994,550
Vedanta Resources plc:
9.50%, 07/18/2018 144A		1,510,000		868,250
9.50%, 07/18/2018		2,500,000		1,449,261


				6,684,686


TELECOMMUNICATION SERVICES 1.0%
Wireless Telecommunication Services 1.0%
Intelsat, Ltd.:
8.50%, 04/15/2013 144A		4,150,000		3,911,375
8.875%, 01/15/2015 144A		410,000		377,200
Telesat Canada, Inc., 11.00%, 11/01/2015 144A		1,000,000		770,000


				5,058,575


Total Yankee Obligations – Corporate (cost $61,230,518)				39,509,334

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2009 (unaudited)
	Share		Value


COMMON STOCKS 0.5%
ENERGY 0.1%
Oil, Gas & Consumable Fuels 0.1%
Alpha Natural Resources, Inc. *		10,254	$	167,345
Chesapeake Energy Corp.		4,083		64,552
Frontier Oil Corp.		27,288		389,673
Newfield Exploration Co.		3,844		73,766
Pioneer Natural Resources Co.		4,306		63,040


				758,376


INDUSTRIALS 0.1%
Construction & Engineering 0.1%
KBR, Inc.		25,942		367,339


INFORMATION TECHNOLOGY 0.1%
Communications Equipment 0.0%
Cisco Systems, Inc. *		4,898		73,323


Software 0.1%
Microsoft Corp.		18,570		317,547


MATERIALS 0.2%
Chemicals 0.1%
Mosaic Co.		13,717		489,285


Metals & Mining 0.1%
AK Steel Holding Corp.		33,034		266,584
Freeport-McMoRan Copper & Gold, Inc.		9,796		246,272


				512,856


TELECOMMUNICATION SERVICES 0.0%
Wireless Telecommunication Services 0.0%
Sprint Nextel Corp.		31,542		76,647


Total Common Stocks (cost $3,300,541)				2,595,373


CLOSED END MUTUAL FUND SHARES 0.6%
Dreyfus High Yield Strategies Fund		411,242		1,130,915
Eaton Vance Limited Duration Income Trust		63,761		699,458
LMP Corporate Loan Fund, Inc.		30,704		210,322
New America High Income Fund, Inc.		148,953		844,566
Wellington High Yield Plus Fund, Inc.		9,355		22,546


Total Closed End Mutual Fund Shares (cost $2,513,845)				2,907,807




	Principal Amount		Value


DEPOSITORY SHARES 0.1%
FINANCIALS 0.1%
Diversified Financial Services 0.1%
JPMorgan Chase & Co., 7.90%, 12/31/2049 (cost $381,171)	$	515,000		392,370


LOANS 9.6%
CONSUMER DISCRETIONARY 5.1%
Education Management, LLC, N/A, 06/01/2013 <		1,535,000		1,190,485
Fontainebleau Resorts, LLC, FRN:
2.00%, 06/06/2014		1,311,610		337,110
5.44%, 06/06/2014		2,623,219		674,220
Ford Motor Co., FRN, 5.00%, 12/15/2013		5,846,299		2,060,411
General Motors Corp., FRN, 2.78%, 11/29/2013		6,287,919		2,722,291
Greektown Casino, LLC, FRN, 5.00%, 12/03/2012 <		1,370,172		546,972

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2009 (unaudited)
	Principal Amount		Value


LOANS continued
CONSUMER DISCRETIONARY continued
Idearc, Inc., FRN:
1.92%, 11/13/2013	$	460,000	$	170,734
3.42%, 11/17/2014		4,788,666		1,711,948
Ion Media Networks, Inc., FRN, 4.34%, 01/15/2012		9,155,000		3,433,125
Metaldyne Corp., FRN:
4.32%, 01/11/2012		2,030,889		599,133
9.88%, 01/11/2014		13,810,051		4,073,965
Newsday, LLC, 9.75%, 07/15/2013		5,070,000		4,450,497
Tower Automotive Holdings, FRN, 6.07%, 07/31/2013 <		970,182		558,398
Tropicana Entertainment, LLC, FRN, 6.50%, 01/03/2012 <		7,770,000		2,331,078


				24,860,367


CONSUMER STAPLES 1.1%
Merisant Co., FRN, 6.92%, 01/11/2010 <		6,581,805		5,133,808


ENERGY 0.8%
Alon Krotz Springs, Inc., FRN, 10.75%, 07/03/2014		1,475,000		549,674
Saint Acquisition Corp., FRN, 5.49%, 06/05/2014		3,820,000		1,718,847
Semgroup Energy Partners, FRN, 5.75%, 07/20/2012		2,445,000		1,764,825


				4,033,346


FINANCIALS 0.3%
Realogy Corp., FRN, 5.74%, 09/01/2014		2,527,172		1,508,898


INDUSTRIALS 0.9%
Clarke American Corp., FRN, 3.45%, 02/28/2014		3,010,768		1,613,802
Neff Corp.:
N/A, 05/31/2013 <		112,500		47,916
FRN, 3.93%, 11/30/2014		12,345,000		2,530,725


				4,192,443


INFORMATION TECHNOLOGY 0.4%
Activant Solutions, Inc., FRN:
3.44%, 05/02/2013		919,551		552,760
3.94%, 05/02/2013		964,761		595,605
iPayment, Inc., FRN, 2.96%, 05/10/2013		906,524		586,294


				1,734,659


MATERIALS 1.0%
Graham Packaging Co., N/A, 10/07/2011 <		1,745,956		1,386,604
Lyondell Chemical Co., FRN, 7.00%, 12/20/2014		8,808,546		3,575,124


				4,961,728


Total Loans (cost $85,023,344)				46,425,249




	Shares		Value


SHORT-TERM INVESTMENTS 18.2%
MUTUAL FUND SHARES 18.2%
Evergreen Institutional Money Market Fund, Class I, 0.84% q ø ##		84,128,917		84,128,917
State Street Navigator Securities Lending Prime Portfolio, 1.90% § ρρ		4,144,498		4,144,498


Total Short-Term Investments (cost $88,273,415)				88,273,415


Total Investments (cost $1,012,684,649) 163.4%				793,729,403
Other Assets and Liabilities and Preferred Shares (63.4%)				(308,031,921	)


Net Assets Applicable to Common Shareholders 100.0%			$	485,697,482

EVERGREEN INCOME ADVANTAGE FUND
SCHEDULE OF INVESTMENTS continued

January 31, 2009 (unaudited)

144A	Security that may be sold to qualified institutional buyers under Rule 144A of the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees, unless otherwise noted.
ρ	All or a portion of this security is on loan.
††	The rate shown is the stated rate at the current period end.
•	Security which has defaulted on payment of interest and/or principal. The Fund has stopped accruing interest on this security.
†	Security initially issued in zero coupon form which converts to coupon form at a specified rate and date. An effective interest rate is applied to recognize interest income daily for the bond. This rate is based on total expected interest to be earned over the life of the bond which consists of the aggregate coupon-interest payments and discount at acquisition. The rate shown is the stated rate at the current period end.
+	Security is deemed illiquid and is valued using market quotations when readily available, unless otherwise noted.
*	Non-income producing security
<	All or a portion of the position represents an unfunded loan commitment.
q	Rate shown is the 7-day annualized yield at period end.
ø	Evergreen Investment Management Company, LLC is the investment advisor to both the Fund and the money market fund.
##	All or portion of this security has been segregated for when-issued, delayed delivery securities and/or unfunded loans.
§	Rate shown is the 1-day annualized yield at period end.
ρρ	All or a portion of this security represents investment of cash collateral received from securities on loan.

Summary of Abbreviations

FRN	Floating Rate Note

At January 31, 2009, the Fund had the following credit default swap contracts outstanding:

Expiration	Counterparty	Reference Debt Obligation/Index	Notional Amount	Fixed Payments Made by the Fund	Frequency of Payments Made	Unrealized Gain (Loss)


06/20/2013	Deutsche	LCDX North America V2 Index	$2,245,550	3.25%	Quarterly	$ 87,672
06/20/2013	JPMorgan	LCDX North America V3 Index	4,481,400	3.25%	Quarterly	16,949
09/20/2013	Deutsch	GE Capital, 4.00%, 09/20/2013	1,015,000	4.00%	Quarterly	(5,693	)
12/20/2013	CitiBank	GE Capital, 6.65%, 12/20/2013	1,515,000	6.65%	Quarterly	154,158
12/20/2013	Goldman Sachs	GE Capital, 4.50%, 12/20/2013	1,270,000	4.50%	Quarterly	21,229

Expiration	Counterparty	Reference Debt Obligation/Index	Notional Amount	Fixed Payments Received by the Fund	Frequency of Payments Received	Unrealized Gain (Loss)


12/20/2013	Bank of America	CDX North America HY Index	$3,217,500	5.00%	Quarterly	$ (31,355	)
12/20/2013	Deutsche	CDX North America HY Index	4,781,700	5.00%	Quarterly	99,730
12/20/2013	Goldman Sachs	CDX North America HY Index	3,217,500	5.00%	Quarterly	(25,506	)
12/20/2013	UBS	CDX North America HY Index	4,430,250	5.00%	Quarterly	173,617
03/20/2014	Credit Suisse	Sun Microsystems, Inc., 2.40%, 03/20/2014	740,000	2.40%	Quarterly	(3,369	)
03/20/2014	Credit Suisse	Sun Microsystems, Inc., 2.00%, 03/20/2014	2,405,000	2.00%	Quarterly	32,208
03/20/2014	Goldman Sachs	Motorola, 6.15%, 03/20/2014	2,135,000	6.15%	Quarterly	(58,961	)
03/20/2014	UBS	Pulte, 2.53%, 03/20/2014	3,475,000	2.53%	Quarterly	7,741
03/20/2014	UBS	Motorola, 5.80%, 03/20/2014	2,105,000	5.80%	Quarterly	(28,981	)
03/20/2014	UBS	Expedia, 6.60%, 03/20/2014	2,535,000	6.60%	Quarterly	(123,434	)
03/20/2014	UBS	Expedia, 6.65%, 03/20/2014	1,540,000	6.65%	Quarterly	(78,049	)

On January 31, 2009, the aggregate cost of securities for federal income tax purposes was $1,018,021,313. The gross unrealized appreciation and depreciation on securities based on tax cost was $1,880,441 and $226,172,351, respectively, with a net unrealized depreciation of $224,291,910.

Valuation of investments

Portfolio debt securities acquired with more than 60 days to maturity are fair valued using matrix pricing methods determined by an independent pricing service which takes into consideration such factors as similar security prices, yields, maturities, liquidity and ratings. Securities for which valuations are not readily available from an independent pricing service may be valued by brokers which use prices provided by market makers or estimates of fair market value obtained from yield data relating to investments or securities with similar characteristics.

Listed equity securities are usually valued at the last sales price or official closing price on the national securities exchange where the securities are principally traded.

Investments in open-end mutual funds are valued at net asset value. Securities for which market quotations are not readily available or not reflective of current fair value are valued at fair value as determined by the investment advisor in good faith, according to procedures approved by the Board of Trustees.

EVERGREEN INCOME ADVANTAGE FUND
SCHEDULE OF INVESTMENTS continued

January 31, 2009 (unaudited)

When-issued and delayed delivery transactions

The Fund records when-issued or delayed delivery securities as of trade date and maintains security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked-to-market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract.

Loans

The Fund may purchase loans through an agent, by assignment from another holder of the loan or as a participation interest in another holder’s portion of the loan. Loans are purchased on a when-issued or delayed delivery basis. Interest income is accrued based on the terms of the securities. Fees earned on loan purchasing activities are recorded as income when earned. Loans involve interest rate risk, liquidity risk and credit risk, including the potential default or insolvency of the borrower.

As of January 31, 2009, the Fund had unfunded loan commitments of $5,218,413.

Securities lending

The Fund may lend its securities to certain qualified brokers in order to earn additional income. The Fund receives compensation in the form of fees or interest earned on the investment of any cash collateral received. The Fund also continues to receive interest and dividends on the securities loaned. The Fund receives collateral in the form of cash or securities with a market value at least equal to the market value of the securities on loan, including accrued interest. In the event of default or bankruptcy by the borrower, the Fund could experience delays and costs in recovering the loaned securities or in gaining access to the collateral. The Fund has the right under the lending agreement to recover the securities from the borrower on demand.

Credit default swaps

The Fund may enter into credit default swap contracts to provide a measure of protection against default on a referenced entity, obligation or index. Credit default swaps involve an exchange of a stream of payments for protection against the loss in value of an underlying security or index. Under the terms of the swap, one party acts as a guarantor (referred to as the seller of protection) and receives a periodic stream of payments, provided that there is no credit event, from another party (referred to as the buyer of protection) that is a fixed percentage applied to a notional principal amount over the term of the swap. An index credit default swap references all the names in the index, and if a credit event is triggered, the credit event is settled based on that name’s weight in the index. A credit event includes bankruptcy, failure to pay, obligation default, obligation acceleration, repudiation/moratorium, and restructuring. The Fund may enter into credit default swaps as either the seller of protection or the buyer of protection. As the seller of protection, the Fund is subject to investment exposure on the notional amount of the swap and has assumed the risk of default of the underlying security or index. As the buyer of protection, the Fund could be exposed to risks if the seller of the protection defaults on its obligation to perform, or if there are unfavorable changes in the fluctuation of interest rates or in the price of the underlying security or index. The maximum potential amount of future payments (undiscounted) that the Fund as the seller of protection could be required to make under the credit default swap contract would be an amount equal to the notional amount of the swap contract.

If the Fund is the seller of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the Fund will pay to the buyer of protection the notional amount of the swap and take delivery of the referenced obligation or underlying securities comprising the referenced index. If the Fund is the buyer of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the Fund will receive from the seller of protection the notional amount of the swap and deliver the referenced obligation or underlying securities comprising the referenced index.

Any premiums paid or received on the transactions are recorded as an asset or liability on the Statement of Assets and Liabilities and amortized. The value of the swap contract is marked-to-market daily based on quotations from an independent pricing service or market makers and any change in value is recorded as an unrealized gain or loss. Periodic payments made or received are recorded as realized gains or losses. In addition, payments received or made as a result of a credit event or termination of the contract are recognized as realized gains or losses.

Certain credit default swap contracts entered into by the Fund provide for conditions that result in events of default or termination that enable the counterparty to the agreement to cause an early termination of the transactions under those agreements. Any election by the counterparty to terminate early may impact the amounts reported on the financial statements.

Valuation hierarchy

On May 1, 2008, the Fund implemented Statement of Financial Accounting Standards No. 157, Fair Value Measurements (“FAS 157”). FAS 157 establishes a single authoritative definition of fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. FAS 157 establishes a fair value hierarchy based upon the various inputs used in determining the value of the Fund’s investments. These inputs are summarized into three broad levels as follows:

Level 1 – quoted prices in active markets for identical securities

Level 2 – other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)

Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

As of January 31, 2009, the inputs used in valuing the Fund’s assets, which are carried at fair value, were as follows:

Valuation Inputs	Investments in Securities		Other Financial Instruments*


Level 1 – Quoted Prices	$	93,776,595		$	0
Level 2 – Other Significant Observable Inputs		699,952,808			237,956
Level 3 – Significant Unobservable Inputs		0			0


Total	$	793,729,403		$	237,956

*	Other financial instruments includes swap contracts.

Item 2 - Controls and Procedures

(a)

The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-Q was recorded, processed, summarized, and reported timely.

(b)

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

Item 3 - Exhibits

File the exhibits listed below as part of this Form. Letter or number the exhibits in the sequence indicated.

(a)	Separate certifications for the registrant’s principal executive officer and principal financial officer, as required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached as EX-99.CERT.

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.

Evergreen Income Advantage Fund

By:
	W. Douglas Munn
	Principal Executive Officer

Date: April 1, 2009

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:
	W. Douglas Munn
	Principal Executive Officer

Date: April 1, 2009

By:
	Kasey Phillips
	Principal Financial Officer

Date: April 1, 2009