Simplest way to financially accept ad revenue?

I am a professional developer with a couple of hobby websites. I have been paying hosting costs out of my pocket over the last couple of years and don't really mind as the users have been grateful. Although the current sites are small in traffic, I am looking to add another site to the mix that could be larger in traffic and resources.

I would like to start offsetting costs with ad revenue and would like to know the easiest setup to go with from a financial aspect. Even if there isn't substantial ad revenue I would still like to write-off the hosting costs.

At the past startups I have been a part of we have gone with an LLC or SCORP and then opened a business account at a local bank we knew. However it looks like a sole proprietorship would be cheaper and easier to setup.

I don't plan on having any employees, or seeking any VC. I also don't accept any online transactions or sell anything else through the sites so I shouldn't have any liability concerns. However thinking about this now, if I were to allow users to buy ad space targeting their niche skills, does that change the outline below?

My thought to organize the this financially and legally:

1. File as a sole proprietorship with a DBA
2. Open a business checking account in the DBA name
3. Register the business account and DBA name with the ad network

Is there an easier / more cost effective way to do this? Is there anything else I should be considering?

I plan on getting at least one of the Nolo books I have read about on this site, but my focus is writing software at the moment, so I appreciate any thoughts you all may have from direct experience.

Way back in the day, when I accepted ads for The Daily WTF, I just had everything go through me personally. It's not that big of a deal, since the revenue is small (few hundred dollars here and there), and no one's going to make a big stink of things. If they prepay and are not satisfied (which never happend), they're not going to sue... and if they never paid after delivery (which also never happened), I'm not going to sue.

From a tax perspective, I wrote off hosting and applied income on my 1040 Schedule C. All done with TurboTax, pretty easy to do. You can do all of the same.

You could set up an entity... but it's probably not worth it if it's just you and it's just some side cash. A lot of the small bloggers that we (Inedo Media) buy ads from are "just a guy" - and we just pay via PayPal or Check. It's no big deal.

However, if you're going to go through the trouble, then at least set-up an LLC. As a Sole Proprietorship, you (personally) have legal liability, which somewhat defeats the whole purpose.