Do You Need a License to Sell Baked Goods From Home in NY?

You do not need a license to sell baked goods from home in New York. The state instead offers a free Home Processor Exemption through the Department of Agriculture and Markets, which lets you bake approved items in your own kitchen and sell them without the Article 20-C food processing license that commercial operations need.¹ You do have to register, follow a specific list of allowed products, and label everything correctly.

What the Home Processor Exemption Is

The exemption is authorized under 1 CRR-NY 276.4. It covers residents who produce approved shelf-stable foods in a home kitchen using standard household equipment. There is no fee to register, and the state does not cap your annual sales, so your volume is unlimited as long as you stay inside the rules.¹

The trade-off is a tight set of restrictions on what you can make, how you package it, and where you sell. Cross any of those lines and you’re outside the exemption, which means you’d need an inspected commercial facility and the Article 20-C license the exemption was designed to spare you.

Baked Goods You Can Sell

Every approved product shares one trait: it is shelf-stable and does not need refrigeration to stay safe. For baked goods, the approved list covers:¹

Breads, rolls, and cinnamon rolls (may contain high-acid fruits, commercially dried fruits, or commercially dried herbs; no vegetables)
Bagels, biscuits, muffins, and scones (same fruit and herb rules; no vegetables)
Cookies, brownies, baklava, and biscotti (biscotti cannot be topped with chocolate or candy melts)
Cakes, cupcakes, and cake pops (no homemade buttercream or cream cheese frostings on cakes and cupcakes; no chocolate or candy melts on cake pops)
Doughnuts without cream fillings
Double-crust fruit pies

The frosting rules trip up a lot of new bakers. You can bake and sell a chocolate cake, but you cannot top it with homemade buttercream or cream cheese frosting. Cake pops cannot be dipped in chocolate or candy melts. These limits exist because those additions either introduce food safety risks or fall outside the parameters the state has approved.¹

Baked Goods You Cannot Sell

Anything requiring refrigeration or temperature control is off-limits, and so is anything with vegetables or without a pathogen kill step. The prohibited list includes several items home bakers often assume are fine:¹

Cheesecake, cream-filled pastries, cream pies, and meringue pies
Single-crust pies, custard pies, and nut pies
Baked goods containing vegetables, including zucchini bread, carrot cake, and pumpkin pie
Products containing alcohol, meat, fish, or poultry

The vegetable rule is the one most people are surprised by. Zucchini bread and pumpkin muffins feel harmless, but the state treats them as higher risk because of the moisture vegetables introduce. If a customer requests something not on the approved list, the answer is no.

Packaging and Labels

Every item has to be pre-packaged in your home kitchen before it leaves the house. Bagging loose cookies at a farmers market table isn’t permitted.¹

Each label must include:

The common name of the product (for example, “Chocolate Chip Cookies”)
A complete ingredient list in descending order by weight
Net quantity of contents
Your name and full address
A home kitchen disclosure such as “Made in a Home Kitchen” in a font size of at least 1/16 of an inch

Allergen disclosure is the piece most worth getting right. Your label must clearly identify any of the nine major food allergens recognized under federal law: milk, eggs, fish, crustacean shellfish, tree nuts, peanuts, wheat, soybeans, and sesame.¹ You can either note the allergen in parentheses next to the ingredient (like “flour (wheat)”) or add a “Contains” statement right after the ingredient list.² For tree nuts, name the specific type (almonds, pecans, walnuts). Allergen mistakes are one of the few things that create real legal exposure for a home baker.

Where You Can Sell

You can sell to consumers directly, or wholesale to local restaurants, cafes, and grocery stores. Approved venues include your home, farms and farm stands, farmers and green markets, craft fairs and flea markets, home delivery, and internet sales within New York State.¹

The wholesale option is often overlooked. If a local coffee shop wants to carry your muffins, that arrangement is allowed. The shop handles its own resale compliance, and nothing extra is required on your end.

In-State Sales Only

Every sale has to stay inside New York. You cannot ship to a customer in New Jersey or Connecticut, even for an order placed through your website. Interstate shipments fall under federal FDA jurisdiction, and under federal regulations a private residence does not qualify as a registered food facility, so there is no legal pathway to ship home-processed food across state lines.³

How to Register

Registration is free and done by mail. Before you start, gather:

Your full name and home address
The physical address of the kitchen where food will be prepared, if different from your mailing address
A complete list of every product you plan to sell
A sample label for each product

Download the Home Processor Registration Request Form (FSI-898c) from the Department of Agriculture and Markets website, fill it out, and mail it with your labels and product list to the department’s Division of Food Safety and Inspection.⁴ If your home runs on a private well, include a recent water test showing negative results for coliform bacteria. The test cannot be more than three months old at submission.

You cannot legally sell anything until the department reviews your application and sends confirmation. Review is straightforward, but rejections happen when applicants list products that aren’t approved or submit labels missing required elements, so check both carefully before you mail.

Taxes You’ll Owe

Most food sold for off-premises consumption in an unheated state is exempt from New York sales tax, and pre-packaged baked goods from a home processor generally fit that description. Tax Law Section 1105(d) imposes sales tax on food sold by restaurants for on-premises consumption but carves out an exemption for food sold unheated, in the same form commonly found in grocery stores, and intended for consumption away from the seller’s location.⁵

If any item you sell is taxable, you have to register for a Certificate of Authority through New York Business Express before making any taxable sales.⁶ Registration itself is free, and registering now protects you if you later add taxable products like candy.

Federal income tax is a separate matter. Baking income is taxable no matter how small, and you’ll report it on Schedule C of your personal return. On top of regular income tax, you owe self-employment tax of 15.3 percent (12.4 percent for Social Security and 2.9 percent for Medicare) on net profit. If you expect to owe $1,000 or more for the year, the IRS expects quarterly estimated payments.⁷ Ingredient costs, packaging, booth fees, delivery expenses, and a home office deduction are all available to offset that income.⁸ Keep receipts from day one.

Insurance and Business Structure

Standard homeowners policies exclude business activities. If a customer has an allergic reaction or gets sick from something you sold, your homeowners insurer will almost certainly deny the claim, and that gap is not something you can negotiate away by phone. Product liability policies written for cottage food businesses typically run around $300 to $400 per year for coverage up to $50,000 in annual sales. Some farmers markets require you to name them as an additional insured before you can set up a booth, which may add $50 to $100 per year.

Most home bakers start as sole proprietors by default. There’s nothing to file and no cost to begin, but a sole proprietorship offers no separation between personal and business assets. Forming an LLC puts a legal wall between the two. Filing Articles of Organization with the New York Department of State costs $200, and New York also requires LLCs to publish a notice of formation in two newspapers for six consecutive weeks, which adds several hundred dollars depending on the county.⁹

Local Zoning Still Applies

The state exemption does not override local zoning. Your city, town, or village may have home occupation rules that restrict business activity in residential areas, limit signage, regulate customer traffic, or require a separate local permit. These rules vary widely across New York’s municipalities. Call your local zoning or planning office before you start selling. Finding out about a zoning conflict after you’ve bought packaging, printed labels, and signed up for a market season is a problem one phone call can prevent.

1
Department of Agriculture and Markets. Home Processing
2
U.S. Food and Drug Administration. Food Allergies
3
eCFR. 21 CFR 1.227 – What Definitions Apply to This Subpart?
4
New York State Department of Agriculture and Markets. Home Processor Registration Request Form
5
New York State Senate. New York Tax Law 1105 – Imposition of Sales Tax
6
New York State Department of Taxation and Finance. How to Register for New York State Sales Tax
7
Taxpayer Advocate Service. Making Estimated Payments
8
Internal Revenue Service. Simplified Option for Home Office Deduction
9
New York Department of State. Articles of Organization for Domestic Limited Liability Company