Cottage food laws let you make certain low-risk foods in your home kitchen and sell them directly to consumers without renting a commercial space or meeting full food-manufacturing requirements. Every state has some version of these laws, but the allowed products, revenue caps, labeling language, and registration steps vary from state to state. The common framework is the same everywhere: shelf-stable foods only, direct sales within your state, a cap on annual revenue, and a state-specific registration or permit.
What You Can and Can’t Sell
Cottage food rules focus on foods that stay safe at room temperature. The FDA calls these non-TCS foods, meaning they don’t need time or temperature control to prevent dangerous bacteria from growing.1Food and Drug Administration. Job Aid – Time and Temperature Control for Safety Foods Whether a food qualifies turns on its moisture level and acidity.
In practice, the items you’ll see on most state approved lists are:
- Baked goods such as breads, cookies, brownies, and fruit pies without custard or cream fillings
- Jams, jellies, and preserves made with high-acid fruits
- Dried herbs
- Honey
- Roasted nuts
- Many candies
- Dry pasta
The near-universal exclusions are meat, poultry, seafood, and dairy, which fall under stricter federal oversight (USDA for meat and poultry, FDA for dairy). Most states also prohibit home-canned low-acid vegetables like green beans or corn, because improper canning of low-acid foods can produce botulism toxin. Fermented foods, raw sprouts, and anything that needs refrigeration are restricted in most states too.
Where You Can Sell
Cottage food laws are built around direct-to-consumer sales. You sell to the person who eats the product, with no middleman. Approved venues typically include farmers markets, community events, roadside stands, and sales from your home. Many states also allow online ordering as long as the customer picks up in person or you deliver the product yourself within the state.
Wholesale is generally off-limits. You usually can’t sell to a grocery store, restaurant, or any retailer that would resell your product. A handful of states have tiered systems that permit limited wholesale at a higher permit level, but the basic cottage food registration almost always restricts you to direct sales.
No Sales Across State Lines
Cottage food exemptions are state-level creations. The moment a sale crosses a state line, it becomes interstate commerce and triggers federal jurisdiction. Federal rules require food facilities engaged in interstate commerce to register with the FDA, and under 21 CFR 1.227 a private residence is explicitly excluded from the definition of a “facility.”2eCFR. 21 CFR 1.227 That exclusion protects you from needing FDA registration for in-state sales, but it also means your home kitchen can’t register as a facility for interstate sales. Federal law separately prohibits introducing adulterated or misbranded food into interstate commerce, and enforcement can include product seizure, injunctions, and criminal penalties.3Office of the Law Revision Counsel. 21 USC 331 – Prohibited Acts Keep every sale, including online orders, inside your state.
Revenue Caps
Nearly every state caps annual cottage food sales. The ceilings vary enormously. Some states set the limit under $25,000. Others allow $75,000, $150,000, or more. A few have eliminated caps entirely.
Exceed your state’s cap and you lose the cottage food exemption. That isn’t a fine; it’s a licensing change. You’d need to move production into a commercially inspected kitchen, obtain the appropriate permits, and comply with the full set of commercial food safety rules. Track your revenue through the year so you don’t hit the cap by surprise.
How to Register
The process varies by state, but most states ask for some combination of the same things. Pull up your state’s specific cottage food law before you start.
Application and Documents
Most states want a basic application that includes your name, address, the products you plan to sell, and the ingredients in each. If your home uses a private well instead of municipal water, expect to submit recent lab results showing the water is safe for food prep. States that require testing typically specify which tests (often coliform bacteria and nitrates) and how recent the results need to be.
Food Safety Training
Many states require a short food safety course covering safe handling, sanitation, and allergen awareness. These courses are usually online and cost somewhere between $8 and $50. The certificate is generally good for a few years. Some states have no training requirement at all, so check before you pay.
Fees and Inspections
Fees are lower than most people expect. Many states charge nothing. Among states that do charge, annual registration fees typically run $25 to $100. Home kitchen inspections are the exception rather than the rule. Most states either skip inspections entirely or only inspect in response to a consumer complaint. A smaller group requires a one-time walkthrough before issuing the permit, with inspectors checking basic cleanliness, handwashing access, pest control, and separation from household activity.
Timeline and Renewal
In states with simple registration and no inspection, approval can take just a few days. States that review documents or schedule an inspection may take two to six weeks. Permits usually renew annually, with the renewal often amounting to updating your product list and paying the fee again.
Labeling Your Products
Your kitchen isn’t commercially inspected, but your labels still have to meet specific standards. Labels are how consumers judge whether a product is safe for them, and they’re the first thing a regulator looks at during a market visit or complaint investigation.
Required Information
At minimum, your label needs the common name of the product and a complete ingredient list in descending order by weight.4California Department of Public Health. Labeling Requirements for Cottage Food Products Your name and physical address (or your permit number, depending on the state) also need to appear so the product can be traced back to you.
Federal law requires packaged foods to show the net quantity of contents in both U.S. customary and metric units.5Federal Trade Commission. Fair Packaging and Labeling Act – Regulations Under Section 4 of the Fair Packaging and Labeling Act A bag of cookies marked “8 oz (227 g)” meets this. It’s easy to overlook and it applies to cottage food just like any other packaged product.
Allergen Declarations
Your label must clearly identify any of the nine major food allergens that appear in the product. Since January 2023, the FASTER Act added sesame to the original eight, bringing the full list to milk, eggs, fish, shellfish, tree nuts, peanuts, wheat, soybeans, and sesame.6Food and Drug Administration. The FASTER Act – Sesame Is the Ninth Major Food Allergen You can declare allergens either within the ingredient list or in a separate “Contains:” statement right after it.
The Home Kitchen Disclaimer
Nearly every state requires a statement telling the consumer the product was made in a home kitchen. The wording varies. Some states accept “Made in a Home Kitchen.” Others require longer language specifying that the kitchen was not inspected by the state health department. Use your state’s exact required wording; a close paraphrase doesn’t count.
When Nutrition Facts Aren’t Required
Cottage food producers are generally exempt from the Nutrition Facts panel. The FDA exempts products from businesses with fewer than 100 full-time equivalent employees when fewer than 100,000 units of a given product sell in a 12-month period.7Food and Drug Administration. Small Business Nutrition Labeling Exemption Almost every cottage food operation sits well under both thresholds. If you make a nutrition claim on your label, though, such as “low sugar” or “high fiber,” you lose the exemption and must include the full panel.
Zoning and HOA Rules Still Apply
A cottage food permit doesn’t override your local zoning code or your homeowners association’s rules. These are separate legal frameworks, and running into one of them after you’ve already bought equipment and printed labels is a common and expensive mistake.
Many cities and counties regulate home-based businesses through home occupation permits that limit customer traffic, signage, noise, and the share of your home used for business. Even where your state cottage food law expressly allows home sales, local zoning may restrict how many customers can visit your home per day or bar on-site retail. Call your zoning office before you start, not after a neighbor complains.
HOAs add another layer. CC&Rs often restrict or prohibit commercial activity, and those restrictions are generally enforceable regardless of state law. A few states have passed laws that override HOA bans on home-based businesses; most have not. Review your covenants before you commit to a cottage food business if you live in an HOA community.
Insurance: Your Homeowners Policy Won’t Cover You
Standard homeowners policies contain business activity exclusions that apply to both liability and property damage. If a customer gets sick and sues, your homeowners insurer will likely deny the claim. If your oven starts a fire while you’re baking a market order, the property claim can be denied too, because the loss arose from a business activity.
Product liability policies for small food businesses are more affordable than most people expect. Annual premiums for cottage food operations typically start around $300, with the exact cost depending on your revenue, location, and products. Many farmers markets and event organizers require proof of liability insurance before letting you set up, so this often isn’t optional even if your state doesn’t mandate it. The coverage you want includes product liability (someone gets sick), general liability (someone trips at your booth or gets hurt at a pickup), and personal and advertising injury.
Taxes on Cottage Food Income
Cottage food income is taxable. The lack of a commercial kitchen license doesn’t change how the IRS treats your earnings. If you earn more than $400 in net profit in a year, you owe self-employment tax and must file a Schedule C with your federal return.8Internal Revenue Service. Self-Employment Tax (Social Security and Medicare Taxes)
The self-employment tax rate is 15.3%, on top of regular income tax. That rate catches new sellers off guard because it’s roughly double what an employee pays, where the employer covers half. Setting aside 25% to 30% of your profit for taxes is a reasonable baseline.
What You Can Deduct
You can deduct ordinary business expenses against your cottage food revenue, which lowers your taxable profit. Common deductions include ingredients, packaging, labels, booth fees, and business mileage. Equipment like stand mixers and ovens may qualify for depreciation or a Section 179 deduction, which lets you write off the cost in the year you buy it.9Internal Revenue Service. Instructions for Schedule C (Form 1040)
You may also be able to deduct part of your home expenses, including utilities, rent or mortgage interest, and insurance, based on the share of your home used for production. The IRS offers a simplified method: $5 per square foot of workspace, up to 300 square feet, for a maximum deduction of $1,500.10Internal Revenue Service. Simplified Option for Home Office Deduction Keep every receipt.
Sales Tax and Bank Accounts
Whether you collect sales tax depends on your state. Some states exempt food sales entirely, some tax all food, and some exempt unprepared food but tax baked goods or candy. Call your state’s department of revenue before you start selling. Getting it wrong can produce back taxes and penalties that erase months of profit.
Most cottage food operators run as sole proprietors and can file Schedule C with their Social Security number instead of an EIN. An EIN is free from the IRS, though, and many banks require one to open a business checking account. A separate bank account for your cottage food income and expenses makes bookkeeping cleaner and gives you better records if you’re audited.