How to Start a Cottage Food Business in Kentucky: Home-Based Processor Registration $50, the $60,000 Cap, Banned Foods and the July 15 2026 Online Sales Change

Kentucky lets you sell certain homemade foods from your home kitchen without building a commercial facility. The state calls this a home-based processor, and the core paperwork is a single registration that costs $50. If you are searching for a kentucky cottage food law summary, a cottage food license kentucky, or a cottage food permit kentucky, you will find that the process is simpler than most food businesses. The limits, however, are strict. This guide covers the registration, the $60,000 annual sales cap, the foods you cannot make, labeling, where you can sell, and the online sales change that took effect July 15, 2026.

One point up front: Kentucky has no general statewide business license. The cottage food registration is a food safety registration handled by the Department for Public Health. It is separate from an entity filing with the Secretary of State and separate from a tax account with the Department of Revenue. Depending on how you sell, you may need some or all of these.

Disclaimer: This article is informational content, not legal or tax advice. Rules, forms and fees can change. Confirm current requirements with the agency named in each section, and consult a qualified attorney or CPA for complex situations, such as selling to restaurants, hiring employees, or growing past the sales cap.

What Kentucky Calls a Cottage Food Business

Kentucky statute refers to this operation as a home-based processor (KRS 217.015(56) and KRS 217.136). The administrative regulation governing the registration is 902 KAR 45:090. If you prepare low-risk foods in a home kitchen and sell them directly to consumers in Kentucky, you fit this framework. The state also has a separate category, the microprocessor, which covers a different group of producers under different conditions. That category is covered in its own section below.

Who Qualifies

Before you spend money on anything, confirm that all five of these conditions describe your business:

• You are a Kentucky resident. Registration under this framework is limited to Kentucky residents.
• You produce food in a home kitchen, not a commercial facility.
• Your gross sales stay at or below $60,000 a year.
• Every product you make is on the allowed list, and none is on the banned list.
• You sell directly to Kentucky consumers.

If any one of these does not fit, stop and confirm your options with the Food Safety Branch before you produce or sell anything.

Materials and Preparation Checklist

Gather these items before you file. Having them ready keeps your registration and your first production run on schedule.

• A clean, dedicated home kitchen with working sinks, a refrigerator, and storage kept separate from pets and laundry
• Written recipes with exact ingredient amounts, so you can list every ingredient accurately on each label
• A kitchen scale and measuring tools, since net weight must appear on every package
• Your complete product list, checked line by line against the allowed and banned foods in this article
• Food-grade containers and packaging that protect the product during storage and transport
• Label stock or a label printer, plus a simple batch log that records the processing date for every run
• Your full name and home address exactly as you want them printed on labels
• A computer or phone with internet access for registration, record keeping, and any online sales
• Your business name, if you plan to sell under a name other than your own (see the assumed name step below)

Step-by-Step: Starting Your Cottage Food Business

1. Confirm each product against the allowed and banned lists. Start with the product list, not the paperwork. A registration cannot make a banned food legal. Cream-filled pies, custards, cheesecake, and canned low-acid or acidified foods are all outside the framework, so drop them from your plan now rather than after you have registered.

2. Set up your home kitchen. Make sure your kitchen is clean, dedicated to food production, and free of pets and laundry during production. Keep ingredients and finished goods in separate, labeled storage. Your kitchen must function as a food production space at all times, so do not plan to run a shared household kitchen during busy production days without a clear cleaning routine.

3. Complete Form DFS-250 with the Food Safety Branch. Register as a home-based processor on Form DFS-250 with the Food Safety Branch, Department for Public Health. The registration fee is $50, and the registration expires March 31. Renewal costs $50. Ask the Food Safety Branch for the current submission method and processing time before you choose a launch date, because those details should be confirmed directly with the agency.

4. Calendar your March 31 renewal. The registration expires March 31 each cycle, and renewal costs $50. Put the date on your calendar with a reminder several weeks ahead. Do not assume a late renewal is simple to fix. Confirm the lapse rules with the Food Safety Branch so you know exactly where you stand.

5. Write recipes and ingredient lists you can defend. Each product needs a complete ingredient list in the order the label requires. Allergens must be identified clearly. Test each recipe at full batch size, since a recipe that works in a small test may behave differently when scaled up, and your label must reflect what is actually in the product.

6. Set up labels and a batch log. Every package needs the required label content listed in the labeling section below. Record the processing date, batch number, and ingredient lot details for every production run so you can answer questions from customers or inspectors quickly.

7. Handle your business name and tax registration. If you sell under a name other than your own, you will need to file an assumed name. Sole proprietors file a Certificate of Assumed Name (Form ASN) with the county clerk of the county where they reside under KRS 365.015(3). County clerk recording fees are set locally, so check your county clerk's fee. The $20 assumed name fee applies to filings made with the Secretary of State by corporations, LLCs, partnerships and other registered entities. For your tax account, register using Form 10A100 through MyTaxes.ky.gov. The Department of Revenue registration page is at revenue.ky.gov/Business/Pages/Register-Business.aspx.

8. Check local occupational license taxes. Kentucky has 120 counties and about 420 cities. Many cities, counties, and school districts levy occupational license taxes on payroll, net profits, or gross receipts. Each jurisdiction runs its own forms and revenue office, so look up the district where your kitchen and your business are located.

Allowed and Banned Foods

The table below lists the foods named in the framework. Anything not on the allowed list should be treated as out of scope until the Food Safety Branch confirms otherwise.

Allowed	Banned
Bread	Cream-filled pies
Cakes	Custard
Cookies	Meringue
Fruit and pecan pies	Cheesecake
Jams and jellies	Cream pastries
Sorghum and maple syrup	Raw sprouts
Dried herbs	Garlic in oil
Nuts	Pureed baby food
Alcohol-free candy	Canned low-acid or acidified foods
Granola
Trail mix
Popcorn

Two details trip up many applicants. First, the allowed list is specific. Cakes are allowed, but cheesecake is not. Fruit and pecan pies are allowed, but cream-filled pies are not. Second, "alcohol-free candy" means candy without alcohol, so bourbon balls and similar candies fall outside the list. Pickles, salsa, and other canned products that are low-acid or acidified are also excluded.

Labeling Rules

Every package must carry a label with all of the following:

• Your name and address
• The product name
• The full ingredient list
• Net weight
• The processing date
• Allergen information
• The statement “This product is home-produced and processed” in 10 point type

Treat the label as a compliance document, not a marketing piece. Print it on each package, do not rely on a sticker on a bag that might come loose, and make sure the ingredient list matches your current recipe. If you change a recipe, update the label before the next batch goes out.

Where and How You Can Sell

Under this framework, you sell directly to Kentucky consumers. The permitted channels are:

• Pickup from your home
• Delivery to customers
• Farmers markets
• Roadside stands
• Events
• Online sales

The online channel is the newest change. Under 2026 Acts ch. 52, online sales became permitted in law starting July 15, 2026. The same act also adds lard and tallow cosmetics, which fall outside this food guide, so confirm the scope of that change with the Food Safety Branch if it affects your plans.

Online sales still have to go to Kentucky consumers. This guide does not cover shipping methods, carriers, or temperature handling for mail orders. Confirm those details with the Food Safety Branch before you ship any product.

Restaurants, Retail Stores and Microprocessors

Selling to restaurants is a separate question. Confirm whether a home-based processor may sell to restaurant purchasers with the Food Safety Branch before you approach any restaurant, because the answer affects how you price and plan your sales.

Microprocessors are a different category. To qualify, a microprocessor must be a farmer who grew the main ingredient of the product. Microprocessors must retrain every 3 years and cannot sell to retail food establishments. If you grow the fruit, nuts, or other main ingredient yourself and are weighing whether this category fits your operation, confirm the requirements with the Food Safety Branch before you register.

Tax and Other Registration Basics

Kentucky has a flat 6% sales tax with no local sales taxes. The tax reaches goods and about 50 services. Whether each of your products is taxable, and how to collect and report the tax, should be confirmed with the Department of Revenue at revenue.ky.gov. Kentucky has no franchise tax, but the Limited Liability Entity Tax (LLET) applies to LLCs and corporations with a $175 minimum. If you form an LLC for your food business, plan for the annual report due June 30 at $15, along with the LLET. Your entity filing is made through the Secretary of State at sos.ky.gov, and the Articles of Organization (Form KLC) carry a $40 filing fee.

Do not confuse these filings with the cottage food registration. The DFS-250 registration authorizes the food production activity. An LLC, an assumed name, and a tax account are separate filings with separate agencies.

Tips and Common Mistakes

• Mistake: registering before checking the product list. Confirm every product is on the allowed list first. A registration does not cover banned foods.
• Mistake: tracking profit instead of gross sales. The $60,000 cap applies to gross sales, so track every sale from every channel, including market stalls, events, and online orders, from your first sale.
• Mistake: missing the March 31 expiration. Calendar the renewal and budget the $50 renewal fee each cycle.
• Mistake: incomplete labels. A missing net weight, processing date, or the required home-produced statement is an easy compliance problem to avoid.
• Mistake: selling outside Kentucky. The framework is limited to Kentucky consumers, including for online orders.
• Mistake: assuming wholesale is allowed. Confirm restaurant and retail sales with the Food Safety Branch before you pitch them.
• Mistake: skipping the local tax check. A city or county occupational license tax may apply even when the state framework is simple.
• Tip: keep one batch log for everything. A single log that records dates, batch numbers, ingredients, and sales makes renewals, tax filings, and questions from buyers much easier.
• Tip: plan your numbers early. The Kentucky Small Business Development Center at kentuckysbdc.com can help you think through pricing and projected sales against the cap.

Expected Results

A registered cottage food operation may give you a lawful way to test a product, build a local customer base, and learn what your buyers want before you invest in more equipment or space. Results depend on your product mix, pricing, marketing, seasonality, and how much time you can put into production and sales. Many small operations may find that the $60,000 cap is a ceiling rather than a target, so plan your growth with that ceiling in mind.

Keep your marketing factual and within the labeling rules. Avoid describing a product as preventing, treating, or curing any condition, and avoid unsupported health claims. Describe ingredients, flavors, and preparation methods plainly. Descriptions like these are easier to defend and may build more trust with customers.

Next Steps

Work through the sequence in order: confirm your product list, set up your kitchen, complete the DFS-250 registration with the Food Safety Branch, and then file any assumed name or tax registration your sales plan requires. Check the local occupational tax district before your first sale, and confirm the restaurant, shipping, and microprocessor questions with the Food Safety Branch before you act on them. For a complex structure, such as an LLC with employees or sales above the cap, talk with a qualified attorney or CPA before you commit.