I can't give you specifics of Maryland, but I can offer some general comments based on your original post.
With regard to business entity formation, the typical forms are sole proprietorship, corporation, and limited liability company (LLC). You can operate as a business in sole proprietor mode, it is not necessary to form a distinct entity. There are reasons why people operate as entities though, and whether you should or not is totally dependent on your specific situation.
To operate as a sole proprietor, all the business activity runs under and is reported under your Federal Tax ID Number (which is an SSN for most people citizens). You keep track of revenues, expenses, etc and report it on your year end taxes, IRS schedule "c". It is possible to obtain business insurance, licenses, and the like as a sole proprietor and it is the simplest way to operate. Everything that the business does, is the same as you doing it personally from a tax and liability perspective.
Forming an entity is done primarily to put a barrier between your personal assets and finances, and those of the business operation. Most common forms for a services business are corporation and LLC. Although this is dependent on state law, an LLC is generally more flexible, but also more complicated. Its generally not advantageous to do a "single member LLC," which would be the case if it was just you owning and operating. Corporation is an easier beast to manage and deal with, and would generally be a better move for a small solo operator. Having proper insurance as a sole proprietor is a good way to insulate you from business liability/exposure if the potential risk is minimal.
If you choose to form an entity, either an LLC or a corp can elect to be treated as a "disregarded entity" whereby the business maintains separate income and expense records, files its own tax returns, and any resulting profit or loss is reported by you on your personal return. Tax on profit, or credit for loss, is taxed or credited along with all of your other income. This treatment is what as "S" corp is as opposed to a regular tax treatment of a corp called a "C" corp. Either one is the same corporation, the letters refer to the way that you elect for the Service to tax them and what return forms you use. S would almost always be preferable for a corp with few shareholders (especially if the few is actually one, and it is you). Regular "C" corps report income, and expenses, and have to pay a tax on profit themselves. If there is any profit left over after that, it can be paid down to you as income, and then you pay income taxes on that. You want to avoid the "double taxation" so make the election.
I cannot tell you the mechanics of forming an entity in MD. There are online companies that can do most of it for one, LegalZoom is one. I have had clients use it and it worked well for them. YMMV. Also, they merely create forms at your direction and are not a substitute for advice of counsel or tax professionals to determine what you actually need.
Obviously, the anticipated revenue and scale of your business will bear heavily on which way you go. The smaller the operation, the less likely it is that you need anything complicated or heavily structured. The presence of any employees other than yourself is also of paramount importance.
I'll post a little more later on the employee angle.
