I am not a lawyer and this is not legal advice, just my opinion based on my experience as both an employee in the games industry, and an indie dev with my own company.
If this is your first project, setting up an LLC and what not can be a very daunting task, as well as expensive. I'd honestly stay away from that for now - Your best bet is to have a simple written agreement, in plain English, spelling out how the profits will be split up, and also very importantly - what happens if someone decides to leave the group, or you need to kick someone out if that happens. This will be percieved as a partnership between the members of the group. Also, keep the scope of the game VERY VERY SMALL. That way you can get something done in a few months, and also the mistakes that you inevitably make will have a much smaller impact.