More distributions equal lower discounts, Porter and Frazier agree

"There could be situations in a tiered partnership where a partner wants reinvestment rather than distributions, but this would be rare," opined Will Frazier in today's BVR webcast looking at the new Astleford case. John Porter (who is also the co-chair of the Georgetown/BVR Summit on Valuation, Tax, and Estate Planning November 10), agrees. "In Astleford, the expert tried to argue that distributions did not influence discounts. I think it does." As Frazier explains, earlier distributions reduce the holding period, increase the present value...and therefore reduce discounts.