State that it is the final letter for payment and that you must receive the amount of money owed before a specific date. State that you will begin court action if you don't receive the money before the due date. Keep copies of all correspondence with the other party. If you talked to the defendant and he is unable to pay, it may be in your mutual best interest to work out a payment plan instead of going to court. If you proceed with legal action, check with your local county clerk's office for instructions about how to bring a suit.
Procedures vary from state to state.
It's also wise to anticipate expenses involved. Also consider travel expenses and time away from work. You'll be less inconvenienced in some locations where small claims courts hold evening and Saturday hearings. However, courts set trial dates at their discretion. Most important, make sure you do your homework before filing your lawsuit.