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If you’re thinking of setting up a home food business or a home bakery business, it’s best to look into how to sell food from home legally before you get started. The question, “Do you need a license to sell baked goods from home” varies depending on where you live and your home living situation. Not only do you have to look at your state and county cottage food laws, but you also need to consider where you live and if it’s practical to operate a home food business. You may have a tiny kitchen or an apartment with security on reception where it’s impractical to have diners coming to your home. You’ll also need to look at if you can run a home food business and, if so, how to sell homemade food if you live in an area with a HOA.
While it might sound far too complicated, luckily help is at hand. If you’re thinking of selling baked goods from home or starting your own home restaurant, read on.
The short answer to that is “it depends.”
While all 50 states now have home food laws, you can’t assume that that means you don’t need a license or a permit when selling your home-cooked goods.
If you’re lucky enough to live in Wyoming, Oklahoma, Utah, North Dakota, or Montana, you come under the food freedom laws and you can sell most foods from home, without needing a license or a permit. You don’t even need to have a kitchen inspection or a food hygiene certificate to get started.
For the rest of the US, each state has its own laws. In some states, it even changes county to county. Do your research, find out what the laws are in your state or county, and make sure you follow them. There are penalties, sometimes severe ones, for operating without a food permit or license where it’s required by law.
Before setting out your stall as a home food business, check what you need to do and whether you need a permit or a license with your Department of Agriculture or your Department of Health. If you do need a permit or a license, you can get all the details and how to apply from them. You may find that you can fill in a straightforward application online and supply what paperwork they need and that’s it.
Bear in mind that some states offer free licenses and some states charge up to several hundred dollars, so check that out and make sure the cost is something you can afford. You should also include it in your business plan and your budget when planning your start-up home food business.
Some states require far more than a license application and you will need to comply with all legal requirements before you start your business, or the very least of it is that you will get shut down.
Some states dictate what you can sell, including banning sales of dairy products or anything that needs refrigeration, like fresh cream cakes and cheesecakes. You may also find that you’re only allowed to sell at farmer's markets or fairs. Yet others will allow you to sell online and into retail stores and restaurants, so be very careful when planning your food business. Another consideration is how much you can make. While many states don’t set a limit that most home cooks will reach, and some, including Alabama, Nebraska, Oregon, and Wyoming don’t set a limit at all, there are a few states that limit what you can earn to $10,000 or less. Colorado, Wisconsin, South Dakota, Vermont, and Virginia all have the $10,000 limit.
You’ll also need to look at whether your kitchen is up to scratch and if you need, for example, a separate sink for handwashing. You may also need to label your food, listing allergens, if any, the ingredients, the date the food was made, the best before or use-by date, and more.
Check everything out with your Department of Agriculture or your Department of Health and comply with what they tell you and you shouldn’t have any problems.
Penalty for selling food without a permit
If you’re thinking you can get away without a permit to sell food from home, here’s the short version—don’t risk it!
The Counter caught attention in 2018 with the headline, “Thousands of California home cooks have no idea they’re breaking the law every day." The article goes on to give examples of everyday home cooks selling food to their neighbors or other guests and provides grim examples of what happened to the people who were caught. Penalties included being shut down by the health department, and being charged with misdemeanors. One lady, in particular, suffered through “more than a dozen court appearances; threats of jail time, fines, and probation; and an inability to land a job because of the pending charges,” and finally had to do 80 hours of community service at the end of it.
Some states will issue large fines, others will send you to jail. It’s simply not worth the risk.
If you can’t yet sell food legally in your state or county, all is not lost. There have been moves recently to pass new laws in various states that give new permissions for home-based cooks and to remove the requirement for permits and licenses in some states, too. Keep an eye out on your local news and watch Castiron’s blog for updates and further help. You can also join The Kitchen, our online community for home cooks and bakers, where you can keep up with the latest developments in cottage food laws and food freedom laws. You can swap tips, help each other out with marketing, and enjoy a support network of people who’ve been there and done that.
One other option, if you don’t want to wait until the laws change in your area, is to look into renting space in a commercial kitchen. Find out more in our blog, How Do I Find a Commercial Kitchen?
When you’re ready to start selling homemade food online, take a look at Castiron’s app for selling home cooked food. Castiron’s all-in-one platform is designed specifically for home cooks and bakers to sell their food. You can easily build your website and start selling food online or from home, and we’ll help you market it too, with a full suite of tools to automate social media, SEO, and emails. And the best part is, it’s free!
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