Assuming you reside in the US, you would need to either form a corporation, which can be done for about $3/400 in my state, or a DBA (probably best for your situation at first). A quick Google search should help you locate local assistance for this. You must pay taxes on the income you receive from the business, and establishing one gives you security. If you are a legitimate business entity, a client cannot sue you personally, but if you operate covertly and off the books, you run the risk of being found out.
