Incorporation V's Sole Proprietorship--Unless a business is very small, there is really no question that you should incorporate. From a legal and financial standpoint, this is a much better choice. It also will give you something you can sell far easier should you ever want to.
As for which format is better--C-Corp, S-Corp, LLC or any other form of structure--that question is answered differently in every state; even some county or cities will make the answer different. Your marital status and desire for estate planning also impact the answer, so the best advice I can give to you is to find a great attorney or accountant who specializes in structure and planning.
All the Best,
Brad Sugars is the founder and chairman of ActionCOACH. As an entrepreneur, author and business coach, he has owned and operated more than two dozen companies including his main company, ActionCOACH, which has more than 1,000 offices in 34 countries.