Advice on registering a hackathon as a company

I'm organizing a hackathon this summer and my team and I have had a lot of fun bootstrapping the whole process. In fact, we enjoyed it so much that we tossed around the idea of making the organization "official". We're all new to this, so naturally we had some concerns:

    - We would be accepting money from sponsors to use towards prizes for the event.
    - We wouldn't be making money or taking a salary. The most that we can benefit from is personal advertisement (getting our name known) and possibly free accounts from sponsors for us to use individually.

Does this mean we need to register the organization as a business? I live in Canada and was thinking I should register it as a sole proprietorship -- but is that even necessary (given the requirements outlined above)? We also need to trademark our name.

What worries me is handling and accepting money from sponsors. Do you need to be a business to do that? I'd appreciate any advice the community here could give me.