IMO, if I stuck to this and didnt charge for it I honestly think Id be fine
Actually, if you don't charge, I can twist that around to demonstrate that not only did you not know what you were doing, but you KNEW you didn't know what you were doing.
"Your Honor, if he were competent, what he did would have had value. Since he didn't charge, we can only assume that what he did had no value, and the reason it had no value was because all parties were well aware that he wasn't competent to work on this weapon."
To turn this issue around, assuming that you know how to work on weapons, why on earth WOULDN'T you obtain the correct licenses and insurance, comply with the spirit of all laws, and take advantage of all the protection, rights and privileges those things would entitle you to? I don't know you, but I assume you would never take shortcuts or make compromises in the work itself, why would you compromise on your own protection?
I'm a general contractor, one of the most litiguous businesses there is. There's no question in my mind that competence is the best defense against lawsuits.
That said, the reason I bring my background up is to say this: the people who would ask you to go "off the record" or "under the radar" are precisely the people that nightmares are made of. They are not customers, they are trouble.
They are easy to identify, they ask for shortcuts, either in the work itself, or in the structure of the deal, they ask to avoid taxes, all in pursuit of some tiny amount of savings.
Customers, on the other hand, are happy to do business with a professional, in a professional manner, and expect to pay a price that will enable the professional to make a profit, remain in business, and keep his/her liscenses, insurance, and equipment in top form.
Just out of curiosisty, how much money are we talking about here? What is the amount that you are willing to take such a risk for? How much will you really save your friend?
And finally, please don't misconstrue my comments as criticism.
On the contrary, consider what I'm saying encouragement. The hard part is the skill, not the paperwork.
Go get your license. Get the insurance. Set up your shop.
Start your business, and build it correctly, from the ground up.
We need more real, honest to god gunsmiths.