I would echo sandman1 in that you need to talk to a CPA/tax attorney. One option that you should specifically ask about is a Limited Liability Company (LLC). They have the liability protection of corporations, the income passthrough of partnerships...
First, I am not a tax accountant, you should consult a tax accountant. With that said, JWK hit alot of them, there are others to owning a business. - you can put up to 30K per year in a Keogh retirement plan, and that amount comes off pre-tax inc...
just a tip but you can use google's excellent spelling checker indirectly. i do this all the time, simply hit http://www.google.com and type the word into the search box. if it can't find a match in its index (which is built from all the insane numbe...