Cottage Food Revenue Cap Tracker
Pick your state, enter your year-to-date gross sales, and see in real time how close you are to the cap that turns a cottage food operation into a regulated food business.
Caps range from $5,000 (Rhode Island, Wisconsin) to $250,000 (Florida), and 23 states have no cap at all (counts shift as states update their statutes). Sail past your state's cap without realizing it and the consequences can include shutdown orders, fines, and a forced upgrade to a commercial kitchen. This tool keeps the line visible.
Educational starting point only — not legal advice. State cottage food laws change every legislative session and are subject to local zoning, HOA, and sales-tax rules; always verify the current cap and requirements with your state agriculture or health department before launching or scaling.
Revenue Cap Tracker
Your operation
Pick your state and enter your year-to-date gross sales (before COGS).
Tier: High cap. Cap is calendar-year gross sales unless your state specifies otherwise.
Use gross sales (before COGS, packaging, or platform fees) — that’s what almost every state’s cap counts.
Used to project your end-of-year total at your current pace.
$150K cap is inflation-indexed. The wholesale path for non-TCS items is unique — few states allow cottage products in retail without a commercial kitchen.
Direct, farmers markets, online, mail, wholesale (non-TCS)
Where you stand
Updated as you type.
$141,500 of headroom remaining
You’re well under the $150,000 cap for Texas. Keep tracking gross sales monthly so the picture stays current.
How cottage food revenue caps work
A cottage food law lets you bake, can, or candy-make from your home kitchen and sell to the public without commercial-kitchen licensing — but only up to a state-specified annual revenue cap. Cross the cap and the operation legally becomes a regulated food business: commercial kitchen, formal inspections, payroll, and the costs that come with them. Caps are almost always measured as gross sales (the total dollars in, before COGS), not net profit. A $25,000 cap means $25,000 of receipts even if your margin leaves $5,000 of profit.
Caps vary by an order of magnitude. Rhode Island and Wisconsin sit at $5,000. Most states cluster between $25,000 and $50,000. Texas raised its cap to $150,000 (inflation-indexed) and Florida's "Home Sweet Home Act" pushed Florida to $250,000 — the highest in the country. Roughly twenty states (Alabama, Arizona, Delaware, Georgia, Idaho, Indiana, Iowa shelf-stable, Maine, Missouri, Montana, New Mexico, New York, North Carolina, North Dakota, Oklahoma, Pennsylvania, South Dakota, Tennessee, Utah, Washington shelf-stable, Wyoming) operate as "food freedom" or no-cap states, though several pair that with restrictions on venues (direct-only) or product categories (no TCS / no shipping). Delaware removed its $25K cap in December 2023 but still requires registration, an 8-hour training course, and inspection; Indiana removed its prior $2,500 cap under HEA 1149 (2022); Pennsylvania has no cottage food exemption at all — home production runs through the Limited Food Establishment program ($35/year, kitchen inspection) with no cap and wholesale + interstate channels open.
The right time to track your cap is on the first sale, not the last. The most expensive pattern we see in cottage food enforcement is a baker who realizes in November that they crossed the cap in August and has been operating out of compliance for three months. The fix is either to stop selling until January (and refund deposits) or to scramble for emergency commercial-kitchen licensing — neither is fun. Watching a real-time progress bar fixes this.
What counts toward the cap (and what doesn't)
Counts: direct sales at farmers markets, online orders for in-state delivery, custom-cake orders, sales tax (in most states — the cap is "gross receipts" inclusive of tax collected, though a few states net it out), and tips. Some states also count shipping that you charge the customer.
Generally does not count: retail sales through a commercial kitchen you also operate (those fall under separate retail food regulations), wholesale sales to a licensed retailer (where state law permits wholesale), and sales of non-food items (the candle you sell alongside the cookies).
Special cases: Iowa's dual-tier system has separate caps for shelf-stable versus refrigerated items. California distinguishes Class A ($75K) from Class B ($150K) by whether you sell direct-only or include online and retail. Virginia caps acidified foods (pickles, salsas) separately at $3,000 even if your general cap is $25,000. Always read your state's specific definition before relying on the headline number.
What happens if you go over
Enforcement is mostly complaint-driven. A competitor reports you, a customer files a foodborne illness complaint, or you self-disclose on your sales-tax filing. Once flagged, state agriculture or health departments can issue stop-sale orders, levy fines (typically $100–$1,000 per violation, escalating for repeat offenses), require you to surrender your cottage food registration, and refer the matter to the local prosecutor for misdemeanor food-safety charges in extreme cases.
The more common outcome is administrative: a letter explaining that you must either cease operations under the cottage food exemption or upgrade to a commercial-kitchen license, which means renting commissary space ($300–$1,500/month in most metros), getting kitchen inspections, paying for a food manager certification, and registering with the state department of agriculture as a food processor. That's the path that growing cottage bakers eventually take by choice — when you cross your cap on purpose, on the date you planned, with the commercial-kitchen lease already signed.
Frequently asked questions
What is a cottage food revenue cap?
A cottage food revenue cap is the maximum annual gross sales a home-based food producer may earn while operating under a state's cottage food law without commercial-kitchen licensing. Caps currently range from $5,000 (Rhode Island, Wisconsin) to $250,000 (Florida); 23 states have no cap at all (counts shift as states update their statutes). Once you cross the cap, you must either stop selling or upgrade to a commercial-kitchen license.
Does the cap count gross sales or profit?
Almost every state's cap counts gross sales — total dollars in, before COGS, packaging, or labor. A few states use "gross receipts" inclusive of sales tax collected. Profit-based caps do not exist in any US state's cottage food law. If you have $25,000 in gross sales with $5,000 of profit, you are at $25,000 toward the cap, not $5,000.
Which states have no cottage food revenue cap?
As of 2026: Alabama, Arizona, Delaware (with inspection + training), Georgia, Idaho, Indiana (Home Based Vendors), Iowa (shelf-stable tier), Maine, Missouri, Montana, New Mexico, New York (Home Processor), North Carolina (Home Processor), North Dakota, Oklahoma, Pennsylvania (Limited Food Establishment — registration + inspection required), South Dakota, Tennessee, Utah, Washington (shelf-stable), and Wyoming. Massachusetts technically has no statewide cap but delegates to local boards of health, so the practical cap depends on your town. Several "no-cap" states still impose other restrictions — New York limits to in-person sales, North Carolina requires kitchen inspection, Delaware requires an 8-hour food-safety course, Pennsylvania requires a $35/year LFE registration and inspection.
What happens if I exceed my state's cottage food cap?
You must either stop selling under the cottage food exemption or upgrade to commercial-kitchen licensing. State enforcement is largely complaint-driven, but consequences when caught include stop-sale orders, fines (typically $100–$1,000 per violation), surrender of cottage food registration, and in extreme cases misdemeanor food-safety charges. The clean path is to plan your transition to commercial well before you hit the cap — typically once you are at 70–80% of cap, you start commissary kitchen and licensing prep.
When does the cottage food cap reset?
In nearly every state, the cap resets on January 1 (calendar year). A few states use a fiscal year or a rolling 12-month window — check your state's specific definition. The tool defaults to a calendar-year projection because that matches almost all state laws; if your state uses a different period, adjust the "months into the year" slider accordingly.
Do online orders count toward the cap?
Yes, in states where online cottage food sales are permitted. The cap counts gross sales regardless of channel — farmers market, in-person pickup, online order with in-state delivery, custom catering. States that prohibit online shipping under cottage food (Hawaii, Kansas, Mississippi, New York, Ohio, Wisconsin) limit your channels but the cap math is the same within those channels.
How do I track cottage food revenue accurately?
Keep one running ledger of every sale — date, channel, gross amount, customer name (when known). Reconcile monthly against your bank deposits and any platform payout statements (Etsy, Square, Stripe). This tool is a snapshot; for ongoing tracking, a real ledger or inventory-and-sales tool like Ardent Seller is the right call. Spreadsheets work for the first $5K but start breaking down once you have more than one sales channel.
Track your cap continuously, not on a spreadsheet
A tracker checks one number on one day. Ardent Seller logs every sale across every channel — farmers markets, online orders, custom cake deposits — and gives you a live gross-revenue dashboard that updates the moment a sale closes. Set your state cap once; the system alerts you when you cross 70% so you have time to plan the commercial-kitchen transition.
Real-time gross revenue per location
Sales from every channel roll into one number. No CSV exports, no monthly reconciliation, no surprises in November.
Batch & lot traceability
Production date and lot code stamped on every finished item — the labeling field Texas now requires and best practice everywhere.
Sources & verification
State revenue cap data is compiled from each state's Department of Agriculture or Department of Health cottage food / home processor program pages, cross-referenced against:
- Forrager — Cottage Food Laws by State (opens in new tab)
- Institute for Justice — State Reforms for Cottage Food and Food Freedom Laws (opens in new tab)
- Harvard Food Law and Policy Clinic — Fifty-State Table of Cottage Food and Home Kitchen Laws (opens in new tab)
- National Agricultural Law Center — Cottage Food Laws: Recent Trends and Major State Changes (opens in new tab)
State laws change every legislative session. Always confirm the current cap, registration requirements, and allowed venues with your state agriculture or health department before launching or scaling. Data current as of 2026-05-17.
Related resources
Cottage Food Laws by State: The 50-State + DC Quick Reference
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Craft Seller Startup Checklist
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From the blog
Articles that dig deeper into the topics this tool covers.
Texas Cottage Food Law: What You Can Sell, Where, and How to Stay Under the $150,000 Cap
Texas has one of the most permissive cottage food laws in the country — and the September 2025 SB 541 changes made it more permissive still. Here is what the rules actually permit, the new wholesale path, the labels that pass an inspection, and the $150,000 gross-revenue line that quietly turns a hobby into a regulated business.
California Cottage Food Operations: Class A vs. Class B, the $150,000 Cap, and the 2026 Compliance Map
California runs the cottage food program through two classes, 58 county environmental health offices, and a separate MEHKO track for hot food. Here is what the rules actually permit in 2026, the difference between Class A and Class B, the foods that quietly disqualify you, the labels that pass an inspection, and the Microenterprise Home Kitchen path you should know exists before you stretch the cottage food rule too far.
Cottage Baker's Glossary: 32 Terms Every Home-Bakery Seller Needs to Know
When you cross from baking-as-hobby to baking-as-business, the language changes overnight. Words you have never heard suddenly decide whether you can ship to another state, deduct your KitchenAid, or label a sourdough loaf legally. Here are the 32 terms — pulled from kitchen, regulation, accounting, and platform-speak — that a new cottage baker meets in their first year.
When Your Hobby Becomes a Business: The Tax and Record-Keeping Tipping Point
The IRS draws a hard line between hobbies and businesses — and being on the wrong side of it can cost you thousands. Learn how to recognize the tipping point and what records to keep from day one.