Thin margins are my whole life and I don't want to spend 800 on an entity for something that might pay me 500 once. Somebody told me you can't accept a fee as an individual, you need at least an LLC and a general liability policy. That smelled like course-selling to me but I don't actually know.
Nothing about receiving a finder's fee requires an entity. An individual can be paid as an individual, and the investor will typically issue you a 1099 for it, which means it's income you report. How it gets reported and taxed is a question for a tax professional, and the answer changes with your situation.
An LLC does two things people conflate. It creates a separate name to contract under, and it can limit personal liability for the entity's obligations. Bird dogging generates very little of the kind of liability an entity protects against, because you don't own property, don't control a site, and don't hold anyone's money. Formation costs vary widely by state, from under a hundred dollars to several hundred plus an annual fee, so check your secretary of state's fee schedule.
General liability insurance covers bodily injury and property damage arising from your operations. Walking a public street writing down addresses doesn't generate much of that. If you start entering vacant houses, that changes, and entering a property without the owner's clear permission is its own problem regardless of insurance.
The exposure that actually applies to you is different in kind. If you tell an investor a house has no foundation problems and it does, and they bought partly on your word, you have a dispute. An entity doesn't fix that. What helps is writing down that your observations are observations, not inspections, and letting the investor do their own diligence. Put it in the one page fee agreement.
I priced my state at 50 to file and 25 a year, so the 800 number you heard is probably someone bundling a registered agent and an operating agreement template into it. Worth checking your own state directly before you assume.