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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An LLC is a legal structure for a business, usually used by very small businesses of 1-3 people, and often just one person. It’s primary role is to protect an individual from the business and vice versa.
If you crash your drone in a wooded area, and the battery has a fault and causes a fire that destroys people’s homes, then those people are going to sue the person responsible for the drone. If you can prove that you were flying your drone on company business, they can only sue the LLC and only claim damages against the property of the LLC – equipment owned by the company and any liquid financial assets it has.
If you don’t have an LLC, they are now suing you, which means that, depending on the amount of the lawsuit, they can claim everything you own – your house, your vehicle, anything.
It also protects the other way – if someone is suing you, the lawsuit cannot touch any of the assets owned by the LLC. So at least if you’re in a really bad lawsuit, at least you have your business to fall back on.
There are other benefits to them, but the legal/financial ones are the primary reason people establish them.
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