As someone who's been doing freelance computer consulting for a while, I've had to deal with this.
Basically, it depends how much you make. If you're making less than a few hundred dollars a year, it's not going to affect you much. You'll report it on your income tax, find that it lowers your return a bit (or possibly completely consumes it),and no big deal.
If, on the other hand it passes a certain point, you will want to start filing your taxes quarterly. This will help avoid massive unexpected surprises come tax time. It's also pretty much required for self-employed people.
What is the point where you should file quarterly? I'm not sure. Best to ask an accountant. To be honest, when I was making $1000 a month as a self-employed person, I didn't bother. It did make income tax time a little scary, but between my other job and my wife's, we sometimes got through with a small refund.
I don't recommend it if you're earning any appreciable percentage of your income through your writing--and especially not if it's your only income.
As for an LLC... I'd also talk to an accountant about that, but from what I remember, it didn't seem worth it to me. Basically, LLC's and similar ways of incorporating help save on taxes when you're making enough to pay yourself a salary. It also helps if someone sues you--they can only take the corporation's assets, not your house. Obviously that's more of a concern for a computer consultant than an author.
That said, if you were creating a small press to publish yourself (or others), and you were regularly shipping out products, paying people for their work, and so on, it would be a necessity.
So, in summary, before doing anything talk to an accountant (i.e. not me), but if you're not making much, you can probably just put it on your income tax.
You might also consider calling your local IRS representatives. I did, and at the time, they recommended taking out a little more from my regular paycheck instead of quarterly taxes.