I am not an accountant or an attorney and this is not "professional advice."
As a Canadian living in the US, my understanding as you have dual citizenship is that you must pay US taxes on everything you make anywhere in the world. So in addition to any taxes you may pay Canada, you must pay taxes on those earnings to the US as well.
I don't yet have dual citizenship, so I have not crossed this Rubicon myself. However, it has been on my mind the past five years or so.
Speak to a US tax accountant specializing in these situations and get their advice. Spend the $200 or whatever for an hour consultation with that accountant if you have to--it's a tax-deductible expense and money well spent. Maybe speak to more than one, because you know if you speak to two people you can get two completely different answers based on their personal knowledge and experience.
Off the cuff, if I was in your shoes I'd incorporate in the US. But again, I'm not a tax accountant or an attorney and don't have all the information.