Yes. To sell crafts in California once you’re past the occasional hobby sale, you need a business license from the city or county where you operate, and you also need a free seller’s permit from the California Department of Tax and Fee Administration (CDTFA). Most craft sellers working from home add a home occupation permit, and anyone selling under a trade name files a fictitious business name statement with the county. Skipping any of these can lead to fines or back taxes.
When Your Craft Selling Counts as a Business
California treats you as a business the moment you intend to profit from your sales and act on that intent. Regular supply buying, product listings, and tracking what sells are the usual signs you’ve crossed the line.
Federal tax law gives a cleaner yardstick. If your activity shows a profit in three out of the last five tax years, it’s presumed to be a for-profit business unless the IRS proves otherwise.1Office of the Law Revision Counsel. 26 USC 183 – Activities Not Engaged in for Profit The IRS also weighs whether you keep organized financial records, invest in advertising, adjust your methods to improve sales, and spend meaningful time on the activity. No single factor decides it.2Internal Revenue Service. Know the Difference Between a Hobby and a Business
If you’re selling at even one craft fair, you’re expected to register before you set up.
The City or County Business License
Nearly every California city and county requires a general business license, sometimes called a business tax certificate, for commercial activity within its borders. You get it from the city where your business is physically located, or from the county if you’re in an unincorporated area.
Fees vary widely and are often tied to projected or actual revenue. Some cities charge under $50 for very small operations; others charge $100 or more. The license usually renews annually, so plan for it as a recurring cost. The application typically asks for your business name, address, a description of what you make, and your expected revenue. Many cities accept online applications. If you later expand into a second jurisdiction or move cities, expect to pull a separate license there.
Some jurisdictions require you to display the license at your place of business, and craft fair organizers routinely ask to see paperwork before letting you set up a booth.
The California Seller’s Permit
A business license alone isn’t enough. Anyone selling tangible goods in California also needs a seller’s permit from the CDTFA. Handmade jewelry, pottery, candles, clothing, woodwork, and similar items all qualify as tangible personal property subject to sales tax. The permit is free, though the CDTFA may require a refundable security deposit at registration to cover taxes that might go unpaid if you later close the business.3California Department of Tax and Fee Administration. Obtaining a Seller’s Permit
Selling only at weekend fairs or holiday markets doesn’t exempt you. The CDTFA issues temporary seller’s permits for selling operations lasting no longer than 90 days at one location.3California Department of Tax and Fee Administration. Obtaining a Seller’s Permit If you already have a regular permit for your home studio, you still need a separate sub-permit for each temporary location such as a swap meet or craft fair. These sub-permits can be requested online or at any CDTFA office.4California Department of Tax and Fee Administration. Operators of Swap Meets, Flea Markets, or Special Events
At swap meets and fairs, you’ll also need to provide the event operator with your business name, address, phone number, driver’s license number, product description, and seller’s permit number.4California Department of Tax and Fee Administration. Operators of Swap Meets, Flea Markets, or Special Events
Direct Sales vs. Marketplace Platforms
California’s statewide base sales tax rate is 7.25%, with most areas adding local district taxes of 0.10% to 2.00% on top, so the combined rate depends on where the sale happens.5California Department of Tax and Fee Administration. California City and County Sales and Use Tax Rate Information For direct sales at fairs, through your own website, or in person, you charge the correct rate, collect the tax, and remit it to the CDTFA on your assigned filing schedule.
Sales through Etsy, Amazon Handmade, and similar sites work differently. Under California’s Marketplace Facilitator Act, the platform is treated as the seller and retailer for each sale it facilitates, so it collects and remits sales tax on your behalf.6California Department of Tax and Fee Administration. Sales and Use Tax Law – Chapter 1.7 You still need your own seller’s permit, but you don’t separately collect sales tax on those marketplace transactions. New sellers sometimes charge tax on top of what the platform already collected; don’t.
Home Occupation Permit
If you make or store crafts at home, most California cities require a home occupation permit before you operate from a residential address. The planning department issues it, and the point is to keep your business from disrupting the neighborhood.
The restrictions are real. Sacramento’s rules are typical: no exterior signage, no more than one non-resident employee working at the home, no more than eight customer visits per day, and the business must remain clearly secondary to residential use. Activities producing noticeable noise, dust, fumes, or odors detectable outside the property line are prohibited outright.7City of Sacramento. Home Occupations – Zoning Permit Process and Requirements Your city’s specific rules will vary but tend to follow this pattern. Fees range from nothing in some jurisdictions to several hundred dollars.
For a seller working quietly at a kitchen table or a garage workbench, none of this is a problem. If you’re running power tools in a woodshop or hosting a steady flow of buyer visits, read your city’s rules carefully before you apply.
Fictitious Business Name Statement
If your business uses any name other than your legal surname, California requires a Fictitious Business Name (FBN) statement, commonly called a DBA (“doing business as”). Selling as “Maria Lopez Ceramics” doesn’t trigger it if your name is Maria Lopez. Selling as “Golden Coast Pottery” does.8California Office of the Small Business Advocate (CalOSBA). Setting Up Your Business in California – Section: Choose a Business Name
You file with the county clerk in the county where your principal business address sits. Fees vary by county. Los Angeles County, for example, charges $26 for one business name with one registrant, plus $5 for each additional name or registrant.9Los Angeles County Registrar-Recorder/County Clerk. Fictitious Business Name (FBN) Fees
Within 30 days of filing, you must publish the statement in a newspaper of general circulation in your county, once a week for four consecutive weeks. After the final publication, you have 30 days to file proof of publication with the county clerk.8California Office of the Small Business Advocate (CalOSBA). Setting Up Your Business in California – Section: Choose a Business Name Publication usually runs an extra $30 to $80 depending on the newspaper.
If You Make Crafts for Children
Crafts designed for children 12 and under carry a separate layer of federal rules on top of California licensing. The Consumer Product Safety Commission (CPSC) requires every domestic manufacturer of children’s products to issue a Children’s Product Certificate (CPC) based on testing from a CPSC-accepted third-party lab, confirming the product meets safety rules including lead content limits and small parts standards.10Consumer Product Safety Commission. Children’s Product Certificate Every children’s product also needs a permanent tracking label showing the manufacturer’s name, production location and date, and batch or run number.11Consumer Product Safety Commission. Tracking Label Business Guidance
Third-party testing can be expensive at small scale. The CPSC’s Small Batch Manufacturer program offers potential relief if your total gross revenue from all consumer products was roughly $1.4 million or less in the prior calendar year and you made no more than 7,500 units of the product. Registration renews annually, you must still comply with all safety standards, and you must still issue a CPC. Relief only applies to lower-risk “Group B” requirements; “Group A” rules always require accredited lab testing.12Consumer Product Safety Commission. Small Batch Manufacturers and Third Party Testing If you make stuffed animals, children’s jewelry, or wooden toys, factor this in before your first sale.
Putting It Together Before You Sell
Before you register anything, gather your business name, home address, Social Security number or EIN, a product description, and your expected annual sales. Projected revenue matters because both your local license fee and your CDTFA filing frequency depend on it.
The CDTFA’s online registration is the fastest path to a seller’s permit and any temporary sub-permits, and permits are often issued almost immediately.3California Department of Tax and Fee Administration. Obtaining a Seller’s Permit For the local business license and home occupation permit, check your city or county’s website; larger jurisdictions take online applications, smaller ones may still want a mailed form or an in-person visit. FBN filings go through the county clerk and sometimes require showing up in person. Keep copies of every permit and every confirmation number; you’ll be asked for them more often than you expect.