The main reason to incorporate your business is to protect your personal assets from liabilities related to your business. If you operate as a sole proprietorship, without a legal entity like a corporation, creditors of your business will be able to seek satisfaction of any debts or liabilities by attaching your personal assets.

If you do business using a corporation, creditors will generally only be able to seek satisfaction of debts and liabilities from corporate assets.

So for example, if someone sues your corporation and obtains a judgment for a matter arising out of the operation of your business, that person could not attach your home or personal investments to satisfy the monetary obligations under that judgment.

If on the other hand, you did not do business through a corporation but rather as an individual proprietor, the person who obtains a judgment against you for a matter involving the operation of your business could attach your personal assets to satisfy that judgment. This puts your house (depending on your state), your car, your investments, your savings...all of your personal assets potentially at risk.

There are additional tax driven reasons to incorporate that may or may not apply to your specific situation. Please consult your tax advisor on these matters.