Transitioning to a passive 50% partner in a business can be a viable option if both parties agree and find it mutually beneficial. While there may not be a standard template for such arrangements, there are some common practices and considerations to keep in mind.

1. Open Communication: The first step is to have an open and honest conversation with your partner about your desire to transition to a passive role. Discuss your reasons, expectations, and potential solutions. It is important to maintain a positive and cooperative relationship during this process.

2. Revisiting the Partnership Agreement: Review the existing partnership agreement to understand the provisions related to partner roles, profit distributions, and decision-making. This document will serve as a basis for negotiations and any modifications required.

3. Valuation and Buyout Options: If you are considering a complete buyout, it is crucial to agree on a fair valuation for your share of the business. There are various methods to determine the value, such as the asset-based approach, market-based approach, or income-based approach. Seeking professional advice from a business valuation expert or attorney can help ensure a fair outcome.

4. Profit Distribution and Compensation: If a buyout is not feasible, you can explore alternative arrangements. One option is to agree on a revised profit distribution and compensation structure that reflects your reduced involvement. For example, your partner could receive a higher salary to compensate for their increased responsibilities, while you continue to receive an equal share of the profits.

5. Silent Partnership Agreement: To formalize the new arrangement, you may consider drafting a silent partnership agreement. This agreement should outline the revised roles, profit distribution, decision-making authority, and any other relevant terms. It is advisable to consult an attorney experienced in business contracts to ensure the agreement is legally binding and protects the interests of both parties.

6. Tax Implications: Any changes to profit distribution or compensation should be evaluated from a tax perspective. Consult with an accountant or tax professional to understand the potential tax consequences for both partners.

7. Ongoing Involvement: As a passive partner, it is essential to define the extent of your involvement in the business. While you may not be actively working, you may still want to stay informed about major decisions, financial performance, and strategic direction. Regular communication and periodic meetings with your partner can help maintain transparency and ensure your interests are considered.

Remember, every partnership is unique, and the terms of transitioning to a passive role should be customized to your specific situation. Seeking professional advice from an attorney, accountant, or business advisor can provide valuable guidance throughout the process.