Reddit mentions of Professional Pen Testing for Web Applications

Setting up a corporation is fairly easy. It takes a few hundred dollars and away you go. You can even buy Nevada corporations via the internet with a credit card.

If you want to focus on IT and security you could get into penetration testing for web applications. There's a vast array of open source and commercial tools available. I've used "burp" (http://portswigger.net/) before and it's pretty capable and easy enough to understand (if you understand the innate nature of http/web applications and such what).

You'll need to acquire some experience with the tool and what you're actually testing for (this might be good... no idea... http://www.amazon.com/Professional-Pen-Testing-Applications-Programmer/dp/0471789666). This can be done for free on your own by picking a popular open source web application and conduct pen testing on it. You'll need to learn how best to approach the open source developers with your results (e.g. jump up and down and screaming doesn't seem to work well)... in other words how to write professional pen test reports that developers will appreciate and act on (low on attitude, high on details).

Once you're comfortable with the tools and your ability/experience then you can look at freelancing sites like odesk.com etc for work. You'll be working your ass off for little money... but you will be building a credible resume and reference-able clients (and solid real world experience).

With a set of reference-able clients you can then start pursuing direct sales/engagements... i.e. looking for local companies that need pen testing but don't wan't to deal with the wishy-washy world of places like odesk.com. With enough work your job history will be the most important thing and your past conviction will be overlooked.

Another alternative is the classic ebay business. Go to your local flea markets, yard sales, estate auctions... buy interesting items cheap... sell the items on ebay for a profit. No idea if this is doable... but you could certainly start this with under $100 and see if you can build that into $200 (or go bust). If you can figure out what sort of stuff from flea markets/yard sales/auctions can be sold for a profit on ebay you can use this to build a bit of a fund to launch another business. You could start doing this this very weekend. You could call it a hobby until you figure that you can make cash with it (i.e. PO can't complain about a hobby can he?)

Lots of small businesses can be started with a small truck and a strong back (moving, garbage removal, landscaping). If you make each client super happy with the result (cheap, fast, super polite, high quality result) you should be able to grow that to the point where you need to hire a helper... and then 2. Then another truck and more helpers.

Good luck!