Congratulations on starting a home-based food business in Florida! To stay in business, you need to be aware of the Cottage Food Law Florida sales tax rules.
Are cottage foods taxable in Florida?
The Florida Department of Revenue decided that foods ordinarily sold in bakeries are tax-exempt. So, any cottage food operation in the home that manufactures these items will not be liable to pay sales tax. However, these foods become taxable when they are sold in public. This includes vending machine and coffee shop sales. Stick to selling direct to consumers online and by mail to avoid charging sales tax.
As a reminder, here is what you can sell as a cottage food business owner in Florida:
- Baked goods such as cakes, cookies, brownies, breads, and muffins
- Jams, jellies, and preserves
- Candies and confections
- Dried herbs and spices
- Dry mixes such as pancake mix and cake mix
- Popcorn
- Fruit pies
- Trail mixes
- Nuts and nut butters
- Honey
- Pickled vegetables
- Vinegar-based dressings
- Dry sauces
- Dry pasta
- Dry cereal
- Granola
Cottage Law & Sales Tax
When it comes to taxes, it is also essential to know about the cottage food sales limit. Cottage food operations may not exceed the gross sales limit of $250,000 per year. If you surpass this sales limit, your products are subject to sales tax.
As long as you follow the Florida cottage law, you won’t have to worry about sales tax. Here is the list of requirements for cottage food businesses in Florida:
- Register with the Florida Department of Agriculture and Consumer Services
- Obtain a Cottage Food Production License
- Complete a food safety training course
- Label your products with an ingredients list and a statement that the product was made in a home kitchen
- Notify the Department of Agriculture and Consumer Services of any changes to your business
- Comply with all other applicable laws and regulations
Understanding cottage food law Florida sales tax is crucial. If possible, consult with a business attorney or tax consultant familiar with cottage food laws and sales tax to ensure you are on the right path with your business.