When to incorporate

From a business liability standpoint, yes; you should incorporate, or form a limited liability company (LLC).

If you have customers who depend on you, if they enter your premises, or if you enter into contracts of any kind, incorporating provides a level of liability protection for your personal assets. Lawyers call this protection the "corporate veil."

It's important that you consult an attorney right away and let them advise you as to whether you should be a corporation, C or Sub chapter S, or an LLC. Either way, it will cost you anywhere from $500 to $1,000.

You will also want to get your CPA involved as well, because whatever you decide will have tax implications.