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There could be a lot of reasons, but one of the more common ones is that a sole proprietor is not an employee of his/her business -- so for contractual agreements, liability, insurance, workers comp, etc. subbing to sole proprietor creates a lot of gray areas and exceptions for the prime contractor. They want to eliminate those. It's really kind of a positive thing, if you think about it (they could have chosen to just no do business with you instead).

Obviously, your last post added some details (i.e., that those issues apply to you, and that you will have subcontractors), so there could be some valid reasons for incorporating. If that's what your accountant advises (who has more information about your business than anyone here does), then that's probably the way to go.

If you're unsure about your accountant's advice for some reason, my question to her might be this: Given that an LLC would be simpler for you to manage as a pass-thru entity (again, pretty much the same as a sole proprietorship -- meaning administration/accounting/taxes are simpler and less expensive than for a corporation), what would be the downside or risk of an LLC, and the upside or benefit of an S-Corp instead? You should be able to get an answer that leaves you with no doubts.