The article in People Magazine years ago said that his dad got transferred in his job and that was the reason he had to quit the show. But elsewhere I read was that Jeremy's dad (his manager??---can't recall) asked for more money and Paul Witt put his foot down.

What was the real story about why he left?

All the stories I read said that his father was transferred to Virginia. Supposedly, the parents asked the producers, "Do you think this show is going anywhere?", and the producers, who thought that Jeremy was really difficult, said "Noooooooo...."

This is what I know: In David Cassidy's book,it said that Jeremy was an hyperactive kid. He bumps into cast members,and they cuss him out. In the TV movie,Jeremy bites Dave Madden,so Danny finds a way to get rid of him. That's why they suggested that Brian Forster take his place as the new Christopher Partridge.

Piecing together the available evidence, especially interviews given over the years by Executive Producer Bob Claver, Producer Paul Junger Witt, and Associate Producer Mel Swope (all three of whom also directed at least one first-season episode, as well), I would have to discount Danny Bonaduce's claims (both in interviews and as presented in that bio-pic) about why Jeremy left the show. The three producers never give much support to the stories of Jeremy being a total brat, biting and/or kicking fellow cast members, etc. What they've all mentioned at various times is the bad behavior of Jeremy's mother, Haley Cynthia Gelbwaks, who because of Jeremy's age had to be around the set all the time. She was not only a pushy "stage mother" to Jeremy, but due to her screenwriting experience, acted like she was some sort of "expert" on tv production. She especially hounded Witt and series creator/writer Bernie Slade to give her son a bigger part and more lines in each episode. It got to the point where these men couldn't stand her, and she was also actively disliked by the cast & crew. I believe that whatever misbehavior Jeremy might have exhibited could be directly attributed to his overbearing, nitpicky mother. Mel Swope, as the self-admitted "jack of all trades" on the PF set, had the uneviable task of trying to reign-in Cyndi Gelbwaks, and even dealing with the Gelbwaks attorney (who acted as Jeremy's agent in legal matters) on behalf of Screen Gems. The Virginia relocation is valid enough, as far as it goes, but doesn't cover the whole story. Swope tells that after they concluded filming the 1st season, they were having grave doubts about keeping Jeremy (mostly due to his awful mother, though, not Jeremy himself). Although the producers were very confident ABC would renew, ABC hadn't given any legal commitment yet for a 2nd season, and without that, Screen Gems couldn't offer contracts to their PF cast. It was at that time that Swope got a call from the Gelbwaks attorney, telling him of a lucrative job offer rec'd by Anthony Gelbwaks back in Virginia, but that they weren't inclined to accept if the PF got renewed & Jeremy was needed for filming. Mel Swope of course couldn't commit Screen Gems to anything, and in any case was sick of dealing with Cyndi Gelbwaks. Swope recalls getting several follow-up calls from the lawyer, increasingly desperate for some kind of answer, as Anthony's company was really pressuring him to make a decision. Mel Swope continued to give absolutely no encouragement, until finally the attorney advised the Gelbwaks that the PF was too "iffy", and they'd better take the Virginia job. Mel also suspects this lawyer knew of the tremendous difficulties his client Cyndi had made for them, and was smart enough to realize they might can Jeremy anyway, regardess of ABC's renewal. So in effect, the attorney was "covering his own ass" by telling them not to wait on Screen Gems; Mel and the others knew what a tiger Cyndi could be, and he's sure the lawyer didn't want to incur her wrath if they stayed on in L.A. for the sake of the PF, then Jeremy got dumped all the same.
I find this version far more credible than Danny Bonaduce's stories. Between Claver, Witt, and Swope, I doubt much got by without their participation (or at least knowledge). Personally, I'd regard them as much better "character witnesses" to both Jeremy and his mother than Danny, who was all of 11 years old when filming started on the PF. I mean, how much would he really remember, anyway? I have a pretty good memory, but don't ask me to recount daily experiences at home or school back when I was 11 or 12 years old. Besides, Danny could be troublesome on the set himself, had a very abusive father, had trouble dealing with the fame the PF brought, and probably had some real jealousy of Jeremy cause everyone DID regard Jeremy as so cute. Add to that a career that fizzled after the PF, heavy drug and alcohol addiction, emotional problems, etc, and you hardly have a very credible source. Yes, Jeremy wasn't a "perfect angel" on the set, but neither was he the monster Danny has portrayed.