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major enterprise for profit or merely incidental to the ongoing business of the company. To determine if the flight operations are incidental, the company should take away the flight operations and see what business is left. When substantial, revenue- generating, business operations remain, the flight operations are likely incidental to the on-going business. In the owner-pilot example, if sufficient business is contributed to AircraftCo, LLC, the aircraft flight operations may be incidental to that business.Consequences of Operating in an Il- legal Flight Department Company.Instead of isolating liability, an illegal flight department company can trigger hundreds of thousands of dollars in FAA fines. Additionally, the structure generally violates aircraft leases, and may result in suspension or revocation of the pilot’s airman certificate. It can also lead to federal excise tax (FET) assessments by the IRS. In the event of an incident or accident, the insurance company will likely deny coverage because the flight operations were illegal.Aircraft owners should never operate an aircraft in a sole-purpose entity unless that entity holds a FAR Part 135 certificate. FAR Part 91 operations in a sole-purpose entity are always prohibited. Working with experienced aviation counsel will help aircraft owners or potential buyers steer clear of common pitfalls in aircraft ownership structuring. The worst time to discover that an ownersh•ip structure is inadequate is after an aircraft incident or accident. T&T! DOWTY! HARTZELL! MCCAULEY! MT PROPELLER! SENSENICH! RAPCO DISTRIBUTOR! WOODWARD PT6Ahttp://www.rockyprop.com e-mail: rockyprop@rockyprop.com! LARGE INVENTORY ! SAME DAY SHIPPING ! UNCOMPROMISED QUALITY ! COMPETITIVE PRICES ! WORLD CLASS WARRANTY ! FACTORY TRAINED TECHNICIANS2865 AIRPORT DRIVE ! ERIE, CO 80516FAX: 303-665-7164 ! FAA/EASA CRS FR6R545NKali Hague is an attorney with Jackson & Wade, LLC. Her prac- tice focuses on advising clients on aircraft purchase/sale con- tracts, and on the ownership and operational structuring of their private and corporate air- craft. She may be contacted at khague@jetlaw.comMARCH 2014TWIN & TURBINE • 15