California’s cottage food law lets you prepare certain shelf-stable foods in your home kitchen and sell them legally, as long as you register (or get a permit) through your county environmental health department, stay within an approved product list, keep annual gross sales under the state cap, and label everything the way the statute requires. The system has two tiers depending on whether you sell straight to customers or also through stores.
What You Can Sell From Home
Only foods that don’t need refrigeration to stay safe qualify. The California Department of Public Health keeps the official approved list, which centers on products with low bacterial-growth risk: breads, cookies, and biscuits without custard, cream, or meat fillings; dried fruits; nuts and nut butters; granola and cereal mixes; jams, jellies, and preserves; honey; candy; popcorn; dry baking mixes; and roasted coffee.
If a product needs to stay cold to prevent spoilage, it’s out. No fresh salads, no dairy-based sauces, nothing with raw eggs. The line can be thin. A fruit jam with enough sugar and acid is fine; a fresh fruit compote that needs refrigeration is not. Check CDPH’s current approved list before you commit to ingredients.
Class A or Class B
California splits cottage food operations into two tiers based on how your products reach customers. Class A registration covers direct sales only, meaning you hand the product to the buyer yourself. That covers farmers’ markets, bake sales, holiday bazaars, community events, farm stands, and sales from your home.
Class B permits allow both direct and indirect sales. Indirect sales means selling to a third-party retailer, like a local grocery store, café, or restaurant, that then resells to consumers. If you want your granola on a neighborhood shop’s shelf, you need Class B.
The practical gap is bigger than the sales channel. Class A operators self-certify that their kitchen meets health standards and generally skip pre-approval inspections. Class B operators must pass a physical kitchen inspection by a county health department representative before the permit issues.
Annual Sales Caps
The statute sets base annual gross sales caps of $75,000 for Class A and $150,000 for Class B, adjusted each year for inflation using the California Consumer Price Index. As of January 1, 2025, the adjusted caps are $86,206 for Class A and $172,411 for Class B.1California Department of Public Health. Cottage Food Operation Adjusted Gross Annual Sales Limit CDPH publishes updated figures each year, so check for the current number before planning a budget.
These are gross sales, not profit. Every dollar a customer pays counts toward the cap, no matter what you spent on ingredients or packaging. Crossing the limit means transitioning to a commercial food facility permit, which carries substantially more cost and regulation.
How to Register or Get a Permit
You apply through your local county environmental health department, not the state. Each county has its own application form, fee schedule, and processing timeline. Fees vary by county and permit class, with Class A registrations usually costing less than Class B permits.
Before you apply, you need to complete a food processor course approved by CDPH. Any ANSI-accredited food handler course meets the requirement, and these are available online at low cost.2California Department of Public Health. Cottage Food Operator Training You must finish the course within three months of receiving your registration or permit.3California Department of Public Health. Cottage Food Operations
Your application will also ask for documentation about your kitchen’s water source, draft labels for every product you plan to sell, and details about your ingredients and equipment. On well water, expect to provide a water quality test. On municipal water, a recent utility bill showing the water provider is usually enough.
Class A Process
Class A applicants fill out a registration form and complete a self-certification checklist confirming the kitchen meets state health standards. No inspector visits the home before approval. The county reviews ingredient lists and label drafts, and if everything checks out, you get a registration number. The process relies on your honesty about kitchen conditions, though a complaint can trigger an inspection later.
Class B Process
Class B applicants must schedule and pass a physical home kitchen inspection before the county issues the permit. The health department representative checks sanitation practices, food storage, equipment condition, and the general state of the production area. Once approved, Class B operations are limited to no more than one routine inspection per year.4California Legislative Information. California Code HSC 114365 – Cottage Food Operations Both Class A and Class B permits must be renewed annually.3California Department of Public Health. Cottage Food Operations
What Your Labels Must Say
Every cottage food product you sell needs a label with each of the following:
- The product’s common or descriptive name, on the front panel.
- The exact phrase “Made in a Home Kitchen” on the front panel in at least 12-point type.
- Your cottage food operation’s name, city, and zip code. If you’re not listed in a telephone directory, include a physical address.
- The permit or registration number issued by your county, along with the name of the local enforcement agency.
- Ingredients in descending order by weight, if the product has two or more ingredients.
- Net quantity stated in both English (pounds/ounces) and metric (grams) units.
- An allergen declaration in plain language if the product contains milk, eggs, fish, shellfish, tree nuts, wheat, peanuts, or soybeans.
Nutrient content claims like “low fat” or “sugar-free,” or any health claim, trigger FDA labeling rules, including a Nutrition Facts panel. Most cottage food operators avoid this by not making those claims.5California Department of Public Health. Labeling Requirements for Cottage Food Products
Rules You Have to Follow While Operating
A cottage food operation can have no more than one full-time equivalent employee beyond the operator. Family members and household members of the operator don’t count toward the cap, so a spouse or child can help without triggering the limit.6The National Agricultural Law Center. California Health and Safety Code – Cottage Food Operation Definitions Delivery drivers also don’t count as employees under the statute.
No pets or small children in the kitchen during production hours. Health inspectors check this during Class B inspections, and a consumer complaint about pets in the production area can trigger an inspection of a Class A operation too. Keep the production space separate from household activity while you’re working.
Class A operations don’t get routine inspections. A health department representative can inspect a Class A kitchen only if a consumer complaint gives reason to believe unsafe food was produced or that the law was violated, and even then the inspector’s access is limited to the registered production area.4California Legislative Information. California Code HSC 114365 – Cottage Food Operations Class B operations get an initial inspection and then no more than one routine inspection per year, with the same complaint-based access rules for anything outside that schedule.
Where You Can Sell and Deliver
You can advertise your products online and take orders through a website or social media. Delivery is where it gets murky. The statute doesn’t explicitly prohibit mailing products, but CDPH’s official position is that deliveries must be made in person rather than through postal or shipping services.
However you read the delivery question, all cottage food sales must happen within California. Shipping across state lines puts you into interstate commerce under federal FDA jurisdiction, which falls outside the Cottage Food Act. Selling nationally means a commercial food facility setup that complies with federal rules.
Zoning and HOA Boundaries
The Cottage Food Act doesn’t override local zoning. Your city or county may require a home occupation permit, and you’ll need to comply with any restrictions on traffic, noise, signage, or commercial activity in residential zones. Local governments generally cannot deny you a permit to operate a cottage food business if you follow their applicable home occupation rules.
HOA restrictions are a separate matter. Many HOAs prohibit running businesses from the home, especially businesses that generate customer traffic. CC&Rs are private contracts, and the state cottage food law doesn’t preempt them. Review your HOA documents before you invest in packaging and permits.
Insurance and Taxes
Standard homeowners insurance policies typically exclude coverage for business activities at your residence. If a customer gets sick from your product and sues, the homeowners policy will likely deny the claim. Product liability insurance designed for food businesses starts at roughly $300 per year, and it’s worth carrying even though the law doesn’t require it.
Cottage food income is taxable. You’ll report earnings and deduct business expenses on Schedule C of your federal return. Common deductions include ingredients, packaging, labels, permit fees, and the training course cost. If you use a dedicated portion of your kitchen exclusively for production, you may qualify for the home office deduction; the IRS simplified method allows $5 per square foot of dedicated space, up to 300 square feet.7Internal Revenue Service. Simplified Option for Home Office Deduction A sole proprietor with no employees can use a Social Security number for tax purposes; an EIN becomes necessary if you form an LLC, hire employees, or meet other IRS criteria.8Internal Revenue Service. Employer Identification Number
Most cottage food products qualify for California’s general exemption for food sold for human consumption, so items like bread, granola, and cookies won’t require you to collect sales tax. Some products can be taxable depending on how they’re classified and sold. If you’re unsure whether yours is exempt, check with the California Department of Tax and Fee Administration.
If You Need More Than Cottage Food Allows
Hot meals, foods that need refrigeration, and dishes with meat and dairy are outside the cottage food framework. California offers a separate permit called a Microenterprise Home Kitchen Operation (MEHKO) that allows preparing and selling potentially hazardous foods, essentially a small restaurant from your home. MEHKOs come with more rigorous inspections and different sales limits, and not every county has opted into the program, so confirm your county participates before heading that direction.