California Cottage Food Laws: Class A vs B, Sales Caps, Labeling

California cottage food laws let you make and sell certain shelf-stable foods from your home kitchen without renting commercial space, as long as you register or get a permit through your county environmental health department. The rules come from the Homemade Food Act, which sets two tiers of home food businesses with annual sales caps of $75,000 and $150,000 depending on how you sell.¹ Everything else, from what you can bake to how you label it, flows from which tier you pick.

Class A or Class B: The First Decision

California sorts home food businesses into two categories based on who buys from you.¹

A Class A operation is direct-to-consumer only. You sell straight to the person eating the food, whether from your home, at a farmers’ market, at a bake sale or holiday bazaar, through a food swap, at a farm stand, through a CSA subscription, or by phone or online order. Registration is a self-certification process with the county, and no kitchen inspection is required before you start.

A Class B operation can do everything a Class A does and can also sell indirectly through third-party retailers like grocery stores, restaurants, and cafes. Because your food reaches a wider audience, Class B requires a county-issued permit and a physical kitchen inspection before you open for business.

What You’re Allowed to Make

Cottage food products must be “nonpotentially hazardous,” meaning they stay safe at room temperature without refrigeration. Anything that needs to be kept cold, like cheesecake, cream-filled pastries, or fresh salsa, is not allowed. The California Department of Public Health keeps the official approved list and can add or remove items.² As of January 2026, the approved categories include:

Baked goods without cream, custard, or meat fillings: bread, cookies, brownies, muffins, cupcakes, fruit pies (not pumpkin), donuts, tortillas, and churros.
Candy and confections such as chocolate, fudge, toffee, brittles, caramels, egg-free marshmallows, cotton candy, freeze-dried candies, and chocolate-covered nuts or dried fruit.
Dried and dehydrated foods including granola, trail mix, dried fruit and vegetables, pasta, popcorn, potato chips, herb blends, spice rubs, coffee, tea, and baking mixes.
Jams, jellies, preserves, and fruit butters from fruits that comply with Title 21 of the Code of Federal Regulations, Part 150.
Roasted or pasteurized nuts and nut butters.
Frostings and fondants (buttercream, flat icing, fondant, sugar glazes) with no eggs, cream, or cream cheese; pasteurized eggs and meringue powder are exceptions.
Extracts of vanilla, citrus, fruit, or spice containing at least 35% food-grade alcohol.
Pure honey, sorghum syrups, vinegars, and mustards.
Powdered beverage mixes like hot chocolate.

If you want to sell something that is not on the list, CDPH has a petition process for requesting additions.

Sales Caps and Help in the Kitchen

Class A operations cannot exceed $75,000 in gross annual sales. Class B operations top out at $150,000.³ These are the statutory base figures, and the law requires annual adjustment for inflation based on the California Consumer Price Index.¹ Ask your county for the current adjusted cap.

You can employ one full-time equivalent worker. Family members, household members, and delivery drivers do not count against that limit.¹ So a spouse and a cousin who help out are fine; two unrelated hires would put you over.

Labeling Your Products

Every cottage food product needs a label that meets state and federal rules. Under California Health and Safety Code § 114365.2, the label must include:⁴

The phrase “Made in a Home Kitchen” in at least 12-point type on the front of the package. If you are repackaging rather than making from scratch, use “Repackaged in a Home Kitchen.”
The common name of the product, like “Chocolate Chip Cookies.”
Your cottage food business name.
Your Class A registration number or Class B permit number, along with the name of the issuing county.
An ingredient list in descending order by weight, if the product has two or more ingredients.

Federal law adds allergen disclosure. The Food Allergen Labeling and Consumer Protection Act, expanded by the FASTER Act, requires you to declare any of nine major allergens: milk, eggs, fish, shellfish, tree nuts, peanuts, wheat, soybeans, and sesame.⁵ Net weight must appear in both English and metric units. Most cottage food operations qualify for the FDA’s small business exemption from full nutrition facts panels.⁶

Selling Online and the State-Line Rule

Both Class A and Class B operators can take orders by phone, online, or through any digital channel, and can fulfill them in person, by mail, or through a third-party delivery service.⁷ That opens up a real online customer base within the state.

Every sale, though, must happen inside California. The moment a product crosses state lines, it becomes interstate commerce and falls under FDA jurisdiction, which does not recognize state cottage food exemptions. Shipping a box of cookies to Nevada would put you in the position of an unlicensed food manufacturer under federal law. Selling nationally means complying with the Federal Food, Drug, and Cosmetic Act and the Food Safety Modernization Act, which effectively requires operating as a licensed food business with a registered facility.

How to Register or Get Your Permit

Your county environmental health department handles registrations for Class A and permits for Class B. CDPH sets statewide rules and manages the approved foods list but does not issue permits itself.⁷ Before you apply, gather:

Proof of food safety training. You must complete an ANSI-accredited food handler course within three months of being registered or permitted, and many counties require it before they process your application.⁸
A full product list with every ingredient, including brand names for pre-made components.
A list of the equipment you’ll use, such as ovens, mixers, and food processors.
Water source documentation. A recent utility bill covers you if you’re on municipal water; well users must provide recent water testing showing the supply is safe.
Draft labels for each product so the department can verify they comply.

Some counties also ask for a kitchen floor plan and a written sanitation procedure. Application forms live on your county environmental health department’s website.

Fees vary by county. Class A registration typically runs a few hundred dollars, and Class B permits tend to cost more because of the inspection. Both carry annual renewal fees. Contact your county for current amounts, since these change often.

Processing time depends on your class and the county’s workload. Class A registrations move faster because they skip the inspection. Class B applications can take a few weeks to a couple of months from submission to approval.

What the Class B Kitchen Inspector Checks

If you’re going Class B, a health inspector will visit your home before you start selling. The inspector looks for a clean, organized food preparation area separated from ordinary household hazards:

Sanitation: clean food-contact surfaces, adequate hot and cold running water, and a working system for sanitizing utensils and equipment.
Storage: ingredients and finished products kept away from household chemicals, cleaning supplies, and non-food items.
Pets: animals kept out of the food preparation area during production.
Pest control: no signs of insects or rodents.

Class A operators aren’t completely exempt from inspection. If a consumer complaint gives the county reason to suspect unsafe food or a rule violation, the health department can inspect a Class A kitchen too.

Renewals and Ongoing Duties

Your registration or permit is valid for one year and must be renewed annually. Class B operators get another kitchen inspection at each renewal. If you move, you need to re-register or re-permit at the new address regardless of where you are in the annual cycle.

Beyond paperwork, you’re responsible for staying under your sales cap, keeping your approved product list current with the county, and continuing to meet labeling and sanitation standards. Many counties want you to submit new products and their labels for review before you start selling them.

Zoning, Business Licenses, and Local Rules

State law bars cities and counties from banning cottage food operations in residential areas. Under the Homemade Food Act, every local jurisdiction must either treat a cottage food operation as a permitted residential use or issue a nondiscretionary permit for compliant operations.⁹ Your city can’t reject you just because you’re running a food business from home.

Cities can still set reasonable standards for parking, noise, and traffic, and many require a separate home occupation permit or general business license on top of your cottage food registration. Check with both your county environmental health department and your city’s planning or business licensing office. If you rent or live under an HOA, your lease or association rules can add restrictions that state law does not override.

Taxes

A cottage food operation is a business, and the IRS treats it that way. You’ll report income on your federal return, typically on Schedule C, and can deduct ordinary business expenses like ingredients, packaging, and equipment. California state income tax applies too.

Sales tax is more nuanced. In California, most food sold for human consumption is exempt when it’s sold in a form that isn’t “prepared food” ready to eat on the premises, and packaged cookies, jams, and granola generally fall into the exempt category. Some items, like certain candies or carbonated beverages, may be taxable. If you plan to sell at farmers’ markets or similar venues, you may need a seller’s permit from the California Department of Tax and Fee Administration. Sort this out before your first sale.

Insurance

California doesn’t require cottage food operators to carry product liability insurance, but skipping it is a real gamble. Homeowner’s and renter’s policies typically won’t cover claims from a home-based food business. If someone gets sick or has an allergic reaction, you could face a lawsuit with no coverage behind you. A general liability policy with product liability coverage is worth pricing out, especially at the Class B level where your exposure grows. Food and beverage carries higher liability risk than most product categories, but a basic policy for a small operation is usually affordable next to the cost of an uncovered claim.

1
California Legislative Information. California Health and Safety Code HSC 113758 – Cottage Food Operation
2
California Department of Public Health. Approved Cottage Foods List
3
California Department of Public Health. Assembly Bill 1144 Fact Sheet
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California Legislative Information. California Health and Safety Code HSC 114365.2
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U.S. Food and Drug Administration. Food Allergies
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U.S. Food and Drug Administration. Small Business Nutrition Labeling Exemption
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California Department of Public Health. Cottage Food Operations
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California Department of Public Health. Cottage Food Operator Training
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California Legislative Information. AB 1616 Assembly Bill – Chaptered