I’m a drone pilot who just got his license (Part 107). I’ve done some shots and gigs for friends but as I am looking into possibly venturing out on my own as a business I keep getting told that it’d be good to be an LLC. Every time I look into it I just get inundated with technical terms. Just wanted someone to really simplify it for me so I can know where I stand. Thanks so much!
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Think of an LLC like a shield between yourself and your personal assets. So let’s say your drone runs out of power halfway through a shoot. It falls on someone and lands them in the hospital. And the person sues you for their medical bills.
Now without an LLC, you would be personally responsible for paying those legal fees. Which means the courts can force you to sell things like your house and your car in order to pay those off. With an LLC however, since the accident happened while you were conducting your business, the injured party now has to sue your business. Of course that might mean your business going bankrupt if it can’t afford to pay, but they can’t touch your personal properties.
Note however that the above only applies if you keep your personal property separate from your business. Like let’s say you want to make your car a part of your business, because you need to drive around to gigs. The pros of this include being able to get tax breaks on the vehicle, and also being able to write off things like maintenance and repairs done as business expenses. After all, can’t get a job done with a flat tyre.
However the risk of it is, since it’s now considered a part of the LLC, if your LLC needs money in any way, like legal fees, or paying suppliers or insurance, that means your vehicle is liable to be sold or repoed in order to cover that debt.
Of course there’s probably a lot of fine details I might be missing out, and the laws might differ from country to country, state to state. So it’s best to either do more research on this or consult with a lawyer or accountant if you’re really unsure.
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