If I start a S or C Corp what benefit packages can I offer potential employees and how would I ramp them in?
I don't have the cash to give them a salary so I need an official way to give them X number of shares if they accomplish their goals.
That's exactly what http://fairsoftware.net does: "pledge equity to your co-founders." Do you know how much it costs? About $10. If you incorporate, you have legal fees, incorporation fees, taxes (federal and state).
A key advice is to stay away from task-based equity. It doesn't work. What you want instead is vesting based on time, but you need to stay on top of their progress. If they are not making good progress on their goals, have a serious discussion, and if need be, pull the plug.
disclosure: I'm one of the founders of FairSoftware.
Partner meaning they are helping you with the company. It makes sense they would want Equity, a certain percent of ownership and revenue.
If they want money for a task, they are not your partners. They are just freelancers.