For Limited Partnerships: Writing a Letter of Withdrawal

Terry Masters reports:

"Withdrawing from a business relationship can be easier if you put your intentions in writing. A letter to withdraw from a limited partnership doesn't have to be a complicated document, but it must comply with any requirements of state law or the company's partnership agreement...Before you consider writing a withdrawal letter, ensure you have the right to withdraw from the business relationship at will. State law allows partners to place withdrawal restrictions in the certificate of limited partnership and the partnership agreement, so check both documents to determine whether you'll need to find grounds that will allow you to withdraw from the partnership early...Limited partnerships are organized under state law. All states allow partners to withdraw from a partnership at will -- absent any withdrawal restrictions -- by providing notice of the partner's intent to withdraw. Most states refrain from defining adequate notice. Instead, they let the partnership set withdrawal notification requirements in the partnership agreement. However, some states do mandate that the notice be provided in writing or provided a certain number of days in advance of the partner's final day of involvement with the business. Check for any state requirements that govern your withdrawal letter to ensure compliance with the law...Your limited partnership's partnership agreement likely spells out exactly how a partner can withdraw from the business, including a detail of any required information that needs to be part of the withdrawal letter...For your withdrawal letter to effectively express your intention to withdraw from the limited partnership by a specific date, it must adhere to any requirements established by the company's partnership agreement...A partnership withdrawal letter doesn't have to be in any particular format. Include a date at the top of the letter. Address it to the general partner if you're a limited partner or to all of the partners if you're a general partner. Alternatively, address the letter to anyone specified as the proper recipient by the partnership agreement. The body of the letter should simply ask the recipient to accept the letter as evidence of your intention to withdraw from the partnership by a certain date. If you're requesting an early withdrawal from a limited partnership that restricts withdrawals, state the basis of your request to be let out of the partnership early. You can include any other information that you deem appropriate. Sign the letter, and send it by registered mail so you have proof of delivery."