Partnership Agreement Template | RUPA-Compliant, All 50 States

A partnership agreement is a contract among the owners of a partnership that governs how the business runs internally: who contributes what, how profits and losses are allocated, who has authority to bind the firm, and how a partner exits. It is the partnership equivalent of an LLC's operating agreement or a corporation's bylaws, and it controls over the statutory defaults on almost every point the partners choose to address.

The structure you pick changes the document. A general partnership makes every partner a manager and exposes each to unlimited personal liability for the firm's debts, which is why the agreement spends real ink on decision thresholds and indemnification. A limited partnership splits the roles: at least one general partner runs the business and carries the liability, while limited partners contribute capital and stay passive, shielded from debts so long as they do not cross into management. That control line is statutory and unforgiving, so a limited partnership agreement reads very differently from a general one. A limited partner who starts directing operations can forfeit the liability shield that was the entire point of the structure.

People confuse a partnership agreement with a joint venture agreement or a simple founders' agreement, but the legal weight differs. A partnership agreement presumes an ongoing business with shared profit motive and triggers fiduciary duties between the partners. If you only mean to collaborate on one project, you may want a narrower contract instead. Our non-disclosure agreement template covering CA, NY, TX and Delaware handles the confidentiality piece if your conversation is still at the exploratory stage.

Partnership law in the United States is state law, and almost every state has built its statute on the Revised Uniform Partnership Act (RUPA), the model code the Uniform Law Commission promulgated in 1997 to replace the Uniform Partnership Act of 1914. The most recent revision has been enacted into law by 37 states, with Louisiana the lone holdout governing partnerships through its Civil Code. The practical effect is that RUPA's defaults apply to your firm in case of absence of a partnership agreement, or when a partnership agreement exists but does not address one particular issue. The agreement is the primary authority; the statute is the gap-filler.

Two RUPA principles drive how this document is drafted. First, a partnership is now treated as an entity separate from its partners, meaning the firm itself owns property and signs contracts rather than the partners owning everything as co-tenants. Second, RUPA replaced automatic dissolution with dissociation: when a partner leaves, dies, or is expelled, the business does not collapse, and the remaining partners may continue and buy out the departing interest. Your buyout clause is what makes that continuity work in practice.

Each target state codifies this differently. California uses the Corporations Code §16100 et seq. for its version of RUPA. Texas folds general and limited partnerships into the Business Organizations Code, Chapters 152 through 154, where §152.204 BOC sets the partner's duties of loyalty and care. Delaware runs on the Delaware Revised Uniform Partnership Act, 6 Del. C. §15-101 et seq., prized for letting partners contractually narrow fiduciary duties. New York retains its older Partnership Law, and Florida governs through Chapter 620, Florida Statutes. Limited partnerships add a second layer, usually a Uniform Limited Partnership Act enactment such as California's Corp. Code §15900 et seq. For the model text and official commentary behind these statutes, the Cornell Legal Information Institute overview of the Revised Uniform Partnership Act is the cleanest starting point.

The cleanest moment to sign is the one nobody thinks about it: the start, when two or more people agree to run a business together and split the upside. A partnership can form by conduct alone, with no paperwork, so the question is never whether you have a partnership but whether you have one on terms you chose. The most common trigger we see in practice is a 50/50 split between co-founders who assume equality solves everything, right up until one wants to reinvest profits and the other wants to take distributions. The agreement is where you settle that in advance.

You need one when capital contributions are unequal. One partner puts in cash, the other puts in sweat equity or a book of clients, and without written terms the default rule may divide profits equally regardless. That mismatch breeds resentment faster than almost anything else in a small firm. You also need it when bringing in a limited partner or passive investor, because the line between funding the business and controlling it determines whether that investor keeps their liability shield.

The harder cases are the ones that legitimize the document. A partner going through a divorce can see their partnership interest pulled into a marital estate, which is why a well-drafted agreement restricts transfers and gives the firm a right of first refusal. A partner who dies triggers the buyout machinery, and the Virginia Supreme Court's reasoning in Creel v. Lilly confirmed that under RUPA the surviving partners may continue the business and buy out the estate rather than liquidate. If your agreement is silent on valuation, that buyout becomes a lawsuit. The same logic applies to a partner's bankruptcy, disability, or sudden decision to compete against the firm.

• The identification of the partners and partnership type establishes who is bound and whether the firm is general or limited, which determines the entire liability structure that follows. For a limited partnership it names each general partner and each limited partner separately, because the statutory roles carry different rights and exposures.
• The capital contributions clause records exactly what each partner brings, whether cash, property, or services, with an agreed valuation for non-cash contributions. It also sets whether and how future capital calls work, so a cash-strapped partner cannot be diluted by surprise or forced to contribute against their will.
• The profit and loss allocation fixes the percentages, which need not match ownership and need not be equal. This is the clause that overrides RUPA's default of equal sharing, and getting it explicit prevents the single most common partnership argument.
• The management and voting rights provision defines who decides what, separating ordinary-course decisions from major actions like taking on debt, admitting a partner, or selling assets. It sets the vote threshold for each tier, because a firm where every decision needs unanimity will deadlock by month three.
• The fiduciary duties and non-compete language states the duties of loyalty and care, and in Delaware in particular it may narrow them by contract where the statute permits. It also restrains partners from diverting opportunities or competing during the partnership. Our state-correct non-compete agreement template covers the standalone version where a broader restraint is needed.
• The buyout and dissociation terms are the heart of the document, setting the valuation method, payment schedule, and triggering events when a partner exits. A buyout that names a formula, an appraisal process, and a payout period turns a partner's departure into a transaction instead of a fight.

California governs partnerships under the Corporations Code §16100 et seq., its enactment of RUPA, with limited partnerships under §15900 et seq. The state imposes a fiduciary duty framework that courts read strictly, and partners cannot eliminate the duty of loyalty by agreement, only define its boundaries. California also requires a partnership operating under a name that does not include all partners' surnames to file a fictitious business name statement with the county, a step founders routinely forget. Profit allocations and management terms set in your agreement will control over the statutory defaults, but the underlying fiduciary obligations survive.

New York stands apart by retaining its older Partnership Law rather than fully modernizing to current RUPA, so several defaults differ from the uniform model, particularly around dissolution and a partner's power to force a winding-up. New York also enforces Article 8-B registration requirements for limited liability partnerships, common among the state's law and accounting firms. Because New York's defaults are less partner-friendly on continuity, an explicit dissociation and continuation clause matters more here than in RUPA states. Drafting to the statute rather than a generic template is not optional in New York.

Texas consolidates everything into the Business Organizations Code, with general partnerships under Chapter 152, limited partnerships under Chapter 153, and shared provisions in Chapter 154. §152.204 BOC codifies the duties of loyalty and care, while §153.102 preserves the rule that a limited partner who participates in control can become liable to third parties who reasonably believed they were a general partner. Texas LLPs also carry an annual report obligation to the Secretary of State, due each June 1, and a lapse terminates the liability shield. The state's franchise tax reaches most partnerships, a planning point worth flagging before you choose the structure.

Delaware runs on the Delaware Revised Uniform Partnership Act, 6 Del. C. §15-101 et seq., and is the jurisdiction of choice for sophisticated partnerships precisely because it gives partners the widest freedom of contract. Delaware permits partners to expand, restrict, or even largely eliminate fiduciary duties in the agreement, subject only to the implied covenant of good faith and fair dealing. The Court of Chancery's expertise in entity disputes is a real asset when money is at stake. If you select Delaware law while operating elsewhere, confirm you can also register as a foreign partnership in your home state.

Florida governs through Chapter 620, Florida Statutes, covering both its RUPA enactment and its Revised Uniform Limited Partnership Act. Florida follows the entity theory and the dissociation framework, so a departing partner does not automatically dissolve the firm where the agreement provides for continuation. The state requires limited partnerships and LLPs to file with the Division of Corporations and maintain a registered agent. Florida's lack of a state income tax makes the partnership pass-through especially attractive, which is part of why the structure is so common among the state's real estate and service businesses.

You start by choosing the structure, general or limited, because that single choice reshapes the rest of the form. From there you select the governing state, and the template loads the correct statutory citations and adjusts the default rules it needs to override, so a California agreement reads differently from a Delaware one without you tracking the differences yourself. You then name each partner and specify their role, which for a limited partnership means tagging each person as a general or limited partner so the liability language attaches correctly.

Next you enter the economic terms: what each partner contributes, how contributions are valued, and the percentages for profit and loss allocation. The form lets you decouple profit splits from ownership, which is where unequal contributions get fairly handled. You set the voting thresholds for ordinary and major decisions, then work through the exit mechanics, choosing a buyout valuation method and a payment schedule that survive a death, withdrawal, or dispute. Once the terms are in, you download an editable Word file and a clean PDF ready for signature. If you are forming a company at the same time, the LLC operating agreement drafted to your state's LLC Act covers the alternative entity structure.

The error that causes the most damage is leaving the buyout clause vague or absent. Partners write "we'll figure out a fair price" and then discover, when one of them dies or quits, that "fair" means a six-figure spread between two appraisers and a year in court. A real buyout names the valuation method, the appraisal process if one is needed, and the payout period, and it specifies every triggering event including death, disability, divorce, bankruptcy, and voluntary withdrawal. The second frequent mistake is treating an equal profit split as automatic fairness when contributions are unequal, which quietly poisons the partnership until the under-rewarded partner walks.

Founders also routinely rely on the statutory defaults without reading them, assuming the law will produce sensible results. It often will not: RUPA's default gives every partner equal management votes regardless of contribution, and in New York the older Partnership Law lets a single partner force dissolution in ways that can blindside the others. A fourth mistake is letting a limited partner drift into management, which in Texas under §153.102 BOC and similar statutes elsewhere can strip the liability shield the limited partnership was built to provide. Finally, partners forget the administrative filings, the fictitious name registrations, the annual reports, the foreign qualifications, and a lapsed filing in a state like Texas terminates LLP protection entirely. The independent contractor agreement template is the right tool when someone is working with the firm rather than owning part of it, a distinction partners blur at their peril.