All this is fine in a place where you can make enough to do this...
I live in PA and work in IT (I have over 15 years in the field) and when I see say... a 6 month contract. They are paying 10-20k. Figuring you get 2 of those back to back to fir perfectly in a year your take home is 20-40k for a year. Unless you live in your parents basement living on that and then incorporating on top of that is going to be pretty insanely expensive. Certainly it is without benefits. Simple health care is going to run you ~$150-200/month on your own (unless you want to pay for nothing
Heck, I just saw a 2 month contract for Pittsburgh, PA and Strongville, OH... For $4k.The requirements to get the job are awfully high (nearly a decade of experience with Websphere, Windows, and Linux administration). Not including travel costs between locations. Heck they don't even reimburse you for the costs of the interview unless you get the job and they came to me. But... For what they wanted and what they were paying, it wasn't interesting for me.
In my experience in my state, contract work is for suckers because it's used by companies to undercut real employment. It's also used to get workers for much less than full time ones cost. 'Negotiate'? That doesn't happen. They tell you what they are paying and you can take it or leave it.
Locally government contracting is almost all short term programming gigs for the State. As someone who is not a programmer by trade, I haven't spent much time looking at them. I'd need to move to get Federal contracts and with my state not even being able to pass a budget for the last 5 months... Well not a good time to be a State employee.