Nope, totally legal. Just make sure your plane has a current 100 hour / annual inspection.
Or, if they're not paying you, all you need to do is follow the regs for parachute operations. A private pilot certificate and airworthy aircraft is enough as long as it's not a "for hire" operation.
Sorry, not true. Back when I took Aviation Law we went over a case study of a pilot who was violated because of this. The pilots logged hours were considered compensation. I'm sure you can find some local POI to say otherwise, but when the **** hits the fan, its the Administrative Law Judge who will decide your fate, no one else.
Also, the FAA is cracking down on parachute ops. You can expect more ramp checks in the future. The USPA has published an updated guide on how to comply with federal regulations and it is available on its website,
www.uspa.org. This is an attempt to pre-empt drastic reg changes/restrictions due to the high number of parachute plane accidents in recent years.
To the original poster, my career progression was...
Skydive C206 PIC (Cape Cod, MA)
Skydive C206 PIC (Fremont County, CO)
Skydive DHC-6 PIC (Tecumseh, MI)
Ameriflight BE99 PIC (Salt Lake City, UT)
Eastway Aviation BE350 PIC (Reading, PA)
BE200 PIC (Bamako, Mali & Kamis Saudi Arabia)
BE200 PIC (Denver, CO)
Did it hurt my progression? Id say no, because the turbine twin time in Tecumseh helped get me the job with AMF. However, I will say this: Flying skydivers for a long time made the learning curve at Ameriflight very very steep. Had it not been for a sympathetic training captain I would have certainly washed out. I had no IFR experience (not even IFR flight plan experience) before that job except for my IFR rating training.
In short, take the job if you can get one, try to instruct on the side (preferably instrument students), and move up to twin turbine aircraft soon or move on.
Good luck.