I am not a legal or financial expert, but I can provide some general guidance on how you might approach breaking out finances and pay structure for your two-person podcast. It's always recommended to consult with a professional accountant or attorney to ensure you follow the correct legal and tax procedures for your specific situation. Here are some steps you could consider:

1. Registering as a Business Entity: To protect yourself and your cohost, you may want to consider registering your podcast as a legal entity such as a Limited Liability Company (LLC). This provides personal liability protection and separates your personal assets from the business.

2. Determine Ownership Structure: Decide on the ownership structure of the business. In your case, if the business is in your name, you would own it entirely. However, if you want to split ownership with your cohost, you could consider forming a partnership LLC where you both have a percentage of ownership.

3. Operating Agreement: If you have a cohost, it's crucial to have a written operating agreement that outlines the responsibilities, decision-making processes, and financial arrangements between the partners. This agreement should address how profits and losses will be split.

4. Tax Considerations: As you mentioned, setting aside a portion for taxes is essential. It's recommended to consult with a tax professional to ensure you are compliant with local tax laws. They can help you determine the appropriate tax structure for your business, such as filing as a partnership or as a sole proprietorship if you own the business entirely.

5. Pay Structure: You have a few options for paying your cohost. One common approach is to treat your cohost as an independent contractor and issue them a Form 1099 at the end of the year. This means they are responsible for their own taxes. Alternatively, you could consider making your cohost an employee of the business, in which case you would need to comply with employment laws, payroll taxes, and potentially offer benefits.

6. Financial Management: Set up a separate business bank account to handle all income and expenses related to the podcast. This will help you keep track of finances and ensure you are properly managing the business's funds.

Remember, these steps are just a starting point, and it's crucial to consult with professionals who can provide personalized advice based on your specific circumstances and local regulations.