2026 guide
Texas cottage food law (2026).
Texas has one of the most baker-friendly cottage food laws in the country — a $50,000 annual sales cap, online orders allowed, in-state shipping legal, and no state license required. Here's exactly how to operate a home bakery in Texas without stepping on a rule.
Annual cap
$50,000
Online orders
Allowed
Shipping
In-state only
Permit
Food handler
The $50,000 sales cap
Texas caps gross cottage food sales at $50,000 per year. That's revenue before expenses, not profit. Cross it and you're operating illegally under cottage food law — you'll need to move production into a permitted commercial kitchen or retail food establishment.
Practically, this means most Texas bakers can run a real side business and even a modest full-time operation, but the cap arrives faster than people expect. At an average order of $60, you're capped at about 833 orders a year. Plan for the graduation before you hit the ceiling, not after.
What you can sell in Texas
Texas allows non-potentially-hazardous foods — items that don't require refrigeration for safety. Commonly allowed:
- Breads, rolls, biscuits, bagels
- Cookies, brownies, biscotti
- Cakes (no cream/custard fillings)
- Fruit pies (no cream pies)
- Jams, jellies, fruit butters
- Dry mixes, granola, roasted coffee
- Candy, popcorn, chocolate
- Pickled goods meeting acidity standards
Not allowed: cheesecake, tres leches, cream pies, custards, meat, any product requiring temperature control for safety.
Texas labeling rules
Every cottage food item sold in Texas must carry a label. The Texas Department of State Health Services specifies exactly what goes on it:
- Producer name and city/state (home address optional)
- Common product name (e.g., "chocolate chip cookies")
- Complete ingredient list, in descending order by weight
- Allergen statement for the FDA's 9 major allergens
- Net weight or volume
- Verbatim disclaimer: "This food is made in a home kitchen and is not inspected by the Department of State Health Services or a local health department."
The disclaimer language is not optional and not paraphrase-able — copy it verbatim. Missing or altered disclaimers are the number one Texas cottage food violation.
Do you need a permit or license?
No state license or home-kitchen inspection is required in Texas. You do need to complete an accredited food handler course (roughly $10–$20 online, 2 hours) before selling. Keep the certificate on file.
No sales tax permit is required for cottage foods sold directly to consumers, but if you sell through a retailer or at events with taxable non-food items, you may need a Texas sales-and-use tax permit.
Where you can sell
- Directly from your home
- Farmers' markets and pop-ups
- Online with delivery or pickup
- In-state shipping (USPS, UPS, FedEx)
- Charity events and fundraisers
- Roadside stands with local permission
Not allowed: interstate shipping, wholesale to grocery stores or restaurants for resale.
Pricing for a $50K cap
Because the cap is on gross revenue, Texas bakers need to protect margin harder than in uncapped states. Every low-priced order eats headroom you can't get back. Aim for a 60–70% gross margin, price at 2.5–3× total cost, and lean into higher-ticket products (custom cakes, weekly subscription boxes) rather than volume plays.
Our cake pricing calculator and the home bakery starter guide walk through the exact formula.
Run your Texas home bakery on Siftii
Auto-generated Texas-compliant labels, per-recipe costing, cap tracking, and booking — built for cottage bakers.