[wikwocket]

I don't see the usual answer posted yet, so here it is: you should talk to an accountant. It's their job to know this, as well as the millions of other little things you should know about when conducting business, and the rules vary a lot base don where you live and operate. Many good ones will meet with you for free to assess your needs.

That said, you should probably incorporate. Incorporation requires very little time and almost no money, and it provides varying measures of liability protection, anonymity, professionalism, legal status, and tax advantages.