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South Carolina

South Carolina’s cottage food laws are very basic and are intended to get someone started before opening a full-scale commercial operation. They only allow operators to make baked goods and candy, which is more restrictive than most other states. However, the main limitation is that they only allow $15,000 of sales per year. Sales must be made directly to the consumer, so while selling to retail stores or restaurants is prohibited, most other venues are permitted.

Although there is no license for cottage food operations, all home-based food businesses in South Carolina must get a business license for tax purposes. In addition, certain products may require lab analysis. All in all, the process to get setup with these laws is quite minimal.

Selling

Allowed Foods

Only “candy and baked goods that are not potentially hazardous foods” are allowed. Moist breads like zucchini, pumpkin, and banana bread may not be allowed. Candy-coated nuts, dried fruits, and caramel corn are all considered “candy”. Here’s some more detailed info about allowed foods.

Lab testing may be required on certain types of food products, like fruit pies (see Business section).

You can sell under 400 gallons of honey directly to the consumer by applying for an exemption.

Only "non-potentially hazardous" foods are allowed, but certain non-PHFs may not be allowed. Most foods that don't need to be refrigerated (foods without meat, cheese, etc.) are considered non-potentially hazardous. Learn more

Limitations

Sales are limited to $15,000 per year

Business

State business license

While there is no license specific to the cottage food laws, each operation must be licensed as a business by the state for tax purposes, which costs $50. The code for this license is 445291. Operators must file taxes every month (even if they make no sales).

Cottage Food Exemption

If you are only selling your products from your home, you don’t need this exemption.

However, if you are selling outside of your home, such as at a farmers market, roadside stand, flea market, or other event, you will need to apply for an exemption from inspection and labeling.

Product Analysis

Lab testing may be required on certain types of food products, like fruit pies and moist quick breads. More information about product analysis can be found at the bottom of the first page of the exemption application.

Labeling

Sample Label

Chocolate Chip Cookies

"NOT FOR RESALE – PROCESSED AND PREPARED BY A HOME-BASED FOOD PRODUCTION OPERATION THAT IS NOT SUBJECT TO SOUTH CAROLINA'S FOOD SAFETY REGULATIONS"


Forrager Cookie Company

123 Chewy Way, Cookietown, SC 73531


Ingredients: enriched flour (wheat flour, malted barley flour, niacin, iron, thiamin mononitrate, riboflavin, folic acid), butter (cream, salt), semi-sweet chocolate (sugar, chocolate, cocoa butter, milkfat, soy lecithin, natural flavors), brown sugar, granulated sugar, eggs, vanilla extract (vanilla bean extract, alcohol, sugar), baking soda, salt (salt, calcium silicate)


Contains: milk, eggs, wheat, soy


NET WT 2 lb 4 oz (1.02 kg)


More labeling info can be found in the Cottage Foods Labeling Guidance document.

Workplace

Ingredients for the business must be kept separate from those for personal use.

Resources

Contacts

Food Protection Division

Department
Department of Health and Environmental Control
Telephone
803-896-0640
Law Dates
June 2012
H4689
This page was last updated on

Comments

what is the business code to sell the baked goods from home and at festivals? I am trying to apply for my business license and I am not sure what code I am supposed to use whether it is 722330 or 445291.
Thank you.

What about a mix that turns milk or yogurt into a healthy dessert? Which category applies? Is it acceptable if the product is not baked and only mixed? Thank you for your feedback.

I just purchased a cake pop with the exact labeling described in the SC Cottage Food Law example. “Not for resale. Processed and prepared by a home based food production operation that is not subject to SC food safety regulations.” I purchased the cake pop at a retail ice cream shop for $2. I checked out the facebook page and web site of the home baker listed on the label and these sites actually direct people to that same retail store to buy the cake pops and cupcakes. The cake pops are displayed at the checkout counter with a sign that reads “Cake pops $1.99” The same person who rang up our ice cream also rang up the sale of the cake pop and the money was placed in the same cash register. Is there some sort of exemption or loophole that allows the sale of home baked goods in a retail store?

    I think that some rules are being misinterpreted here or maybe I am not following the conversation correctly. After many conversations with DHEC and Department of Agriculture, my interpretation is that food prepared at home under the cottage food law can be sold in a retail environment but not a retail business that already has a DHEC approved kitchen. For example, say I own a bakery that is fully approved by DHEC, licensed, the whole 9 yards legal. I cannot bake cakes at home under the cottage food law and bring to my bakery. I can however, rent a booth from a non-food retail establishment and sell my cottage food items with the proper cottage food labeling. I can also rent a store front and sell my cottage food (properly labeled) as a retail business.

    JH, thanks for the clarification. I’ve seen states go both ways: some prohibit all sales at retail stores, and others allow direct sales at non-food establishments. There isn’t anything in SC’s law that would prevent a CFO from selling directly at a non-food shop.

    However, in Kacey’s instance, the sale was happening both indirectly and at a food facility, so it was illegal on two accounts. There is no loophole for her case, but her actual question was quite generic, so thanks for addressing that.

So as long as I pay the 50 bucks I can sell only the listed items out of my house without an inspection? What to do if I want to sell soul food plates from home or go out in community to sell?

So in order to sell cakes out of my home I have to pay $50 to get a business license? Does DHEC have to come out and inspect my kitchen?

Can you explain the restrictions on selling across state lines? Is that for internet sales? I have friends who live in NC, can I sell my product to them? Would they need to pick up the product at my home?

It says pets aren’t allowed in the kitchen while prepping. It’s OK to have pets in the home in South Carolina, correct? It says in NC, pets are not even allowed to be in the residence. Thanks!

While it’s great that you mention the need to get a business license, where does the referenced $50 come from? “Although there is no license for cottage food operations, all home-based food businesses in South Carolina must get a business license for tax purposes, which costs $50.” Each city and county with business licenses have their own rates, and the State of SC does not have a “State” business license. This is misleading and can cause much confusion.

    Pam, thanks for mentioning that. I honestly can’t remember where I came up with $50… my guess is that I found a business license online that had a $50 fee. Back then, I may have been unaware that business licenses are usually county/city specific, but I’ve learned a thing or two in the past year and now can easily see that that info is faulty. I also am no longer including business licenses in the cost calculations on the law pages because they vary. I have made the adjustments on this page and thank you again for letting me know.

    As a SC home baker operating under the cottage food law, and the admin. for the SC Cottage Food Law FB page, I can tell you that all home bakeries must have a retail business license from the SC Dept. of Revenue (State) which costs $50. I’m sure that’s where the $50 amount came into play. If you choose to be an LLC, there is an additional fee for that when you apply for your retail business license. The only reason we actually have to have this license is we are required to collect sales tax on all our sales.

    Thanks Sheryl. I’ve added this info back in here… now it makes sense as it is a state license that’s applicable to all. In other states, usually business licenses are managed by counties or cities. Would CFOs in SC typically have to get a local business license too?

    Hi David, Sorry for the late response to your question. Some counties do require local business licenses in addition to the state license, but not all. Also, some counties require people to get an exemption from their zoning board to allow the home business and that process may involve making sure the neighbors have no complaint of having a home business near them. We have heard of no one being denied a home bakery in their town. I need to correct some statements that I’ve read here. The cottage food law was designed specifically for the home baker to be able to sell custom ordered birthday and wedding cakes, and other baked goods from their home kitchen to the public without having to have a DHEC inspected kitchen. So cakes ARE allowed. We may advertise as well. Since the law is relatively new, only two years, many agencies and county governments are not familiar with it and give incorrect answers. The Dept. of Agriculture gives us an exemption if we wish to sell at a Farmer’s Market, Flea Market, or similar venue. Custom ordered cakes would not be sold at a Farmer’s Market…mainly foods like cookies, pound cakes, breads, etc. The ability to sell at a Farmer’s Market is at the discretion of the Market Manager. We may NOT sell in a storefront or any retail environment. We may NOT place our items on consignment in another store, and we may NOT sell our items to be resold somewhere else. For opening our business the code is 445291. The cottage food law does not prohibit selling to people who live across state lines if they have come to you and placed an order. There are a good many home bakers that live near the borders of NC and GA who have out of state customers. You can have a web page set up to receive payments for custom orders. You can make deliveries of custom ordered baked goods. I appreciate your link to our Facebook page and the other links for information. I spend a great deal of my personal time educating people on the SC Cottage Food Law and I do have credentials of sorts. I mentioned before I am one of the admins the SC Cottage Food Law Facebook page, but I also was one of two women who initiated the cottage food law movement in SC by getting my Senator to sponsor the bill. I attended the statehouse hearings and spoke before the committees and argued for the law until it was passed. I had detailed conversations with the head of DHEC and officials from the Dept. of Agriculture so I have a very good understanding of the cottage food law.

    This is so helpful — thanks so much.

    In rereading the ag dept’s FAQ page, I think I can see what you’re saying and it looks like I misinterpreted it. So just to be clear, they are saying that since custom made items do not fall under the jurisdiction of the ag dept, the only place you can sell those items is where they were made, or via an individual delivery? I must say, that section of their FAQ page could be worded better to be less confusing.

    Yes, David, that’s correct. The only place we can sell our custom ordered cakes is from our home. A delivery is not considered a place of sale because custom orders are confirmed and payment made prior to the actual delivery. (Or at least they should be). Most of the time, a delivery would only be required for wedding and other large cakes. I agree about the need for better wording on the FAQ’s. The statement that custom cake “do not fall under the jurisdiction of the Dept. of Ag” is correct, but people need to know that doesn’t mean they are not allowed. It just means that they don’t regulate home bakers, but they do regulate farmer’s markets and what gets sold there. Farmer’s markets have a policy that all seller’s of baked goods make their foods in a DHEC approved kitchen and they review labeling to make sure it is in compliance with federal regulations before a person can sell. So the Dept. of Ag. offered home bakers an exemption from that if they want to sell their product at the market. The market manager still has the final authority and may deny a home baker. Another thing to note, is that home bakers in SC do not actually fall under DHEC’s jurisdiction either. We are not considered a retail food establishment, and do not have to have our home kitchens inspected. But they do reserve the right to make an inspection if a complaint is made against the home baker. DHEC made sure guidelines to sanitation, food storage, food safety, etc. were put into the cottage food bill when it was in the statehouse. The law itself is our guideline of what is required of home bakers, and that is the only thing that DHEC puts on their web page…a small link at the bottom of their page that tells who needs to have a license from them. I really consider home bakers in SC to be self-regulated (complying with the law), simply because a person can set up their home bakery without any paperwork or contact with DHEC or the Dept. of AG. It is my hope that all home bakers are setting up according to the guidelines in the law, even though self-regulated. A home baker can’t “cut corners” anywhere, because if they do, they step out of the cottage food “umbrella”, and at that point, DHEC does have the authority to shut you down.

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