David Crabill
@david
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Yes, that’s doable but usually quite expensive and complicated. It’s likely that the commercial kitchen would have to be separate from your primary kitchen. Unless NJ has very lenient standards, you can expect to pay thousands or tens of thousands of dollars for that remodel. I would personally recommend renting at first and proving your business concept, but you have to determine what’s right for you.
Setting aside the sales tax question temporarily, I just want to make sure that you’ve gone through the steps to make sure you’re running your business legally. Are you sure that your county doesn’t require you to get a business license for your chocolate business? More general info: http://forrager.com/faq/#starting
From what I understand, a hobby classification is more intended for a business that has no intent to profit from it, or has not profited from it for the majority of the past five years. Hobbies cannot take business deductions because of this. Any activity for which you intend to make a profit is considered a business, no matter how small it is. Even if you are classified as a hobby, I don’t think that would affect the way that your state or county classifies you.
Getting back to sales tax… if govt officials aren’t sure about sales tax requirements, then I wouldn’t fully trust any answer you get from someone online. They are the ones enforcing the rules, and they need to know these things. Generally, if you are selling something that is consumed off the sale premises, there can be exemptions (especially at the state level) for sales tax, but often each county and city has their own tax rates that don’t include exemptions. I don’t know more than that, but I do know it can be frustrating to hop from one official to the next and get conflicting answers.
All of the prep needs to happen in the commercial kitchen… you can’t use your home for production. Once you go through the process of becoming a commercial food processor, you can sell anywhere (assuming you have the appropriate permits to sell there).
You can do dry spices under the cottage food law and you can’t ship them. If you want to ship, you need to use a commercial kitchen. http://forrager.com/faq/#commercial
Either the tea sellers are producing their tea in a commercial kitchen, or they are operating illegally. http://forrager.com/faq/#commercial
I know it seems weird, but actually those kind of prohibitions happen all the time across the country. The cottage food law doesn’t omit Charleston… the city does. It’s their choice to allow the law and if they choose not to, there’s not much you can do about it aside from moving. The most knowledgeable person about this is Sheryl, the admin at this Facebook page: https://www.facebook.com/SCCottageFoodLaw
Reselling of your products is not allowed in any way. I’m not sure if they can offer your pretzels without reselling them… you should contact the health dept to ask about that.
You wouldn’t be able to make the cupcakes in your home kitchen to sell in this way. Instead, you need to use a commercial kitchen. http://forrager.com/faq/#commercial
You can’t sell it under the cottage food law… you need to use a commercial kitchen. http://forrager.com/faq/#commercial
No, NY isn’t really setup for a custom food business, since they only allow sales at events and stores. The law is intended for a home cook who makes items and then brings them to an event and sells them there, or sells them to a store for resale. You should contact your health dept: http://forrager.com/faq/#commercial
