Colorado Cottage Laws
Turn your home kitchen into a legal food business with Colorado's flexible cottage food laws
Are you ready to transform your passion for baking into a profitable home business? Colorado's Cottage Food Laws are among the most entrepreneur-friendly in the nation, making it easier than ever to legally sell your homemade goodies. This guide will walk you through everything you need to know to get started, explained in simple terms that anyone can understand.
What Are Cottage Food Laws?
Colorado's Cottage Foods Act was enacted in 2012 and allows you to prepare and sell certain non-potentially hazardous foods directly from your home kitchen – no commercial kitchen, no expensive licensing, and no government inspections required! The law has been updated several times, with significant improvements in 2016 that removed many restrictions and even allowed internet sales within the state.
Think of it as your legal green light to start a food business from home, as long as you follow some basic safety rules and guidelines.
What Makes Colorado Special?
Colorado's cottage food laws stand out from other states in one huge way: instead of limiting your total annual sales, Colorado limits you to $10,000 net revenue per product type or flavor. This means you could potentially earn unlimited income by creating different products!
For example:
- $10,000 from chocolate chip cookies
- $10,000 from oatmeal cookies
- $10,000 from snickerdoodles
- $10,000 from blueberry muffins
- And so on…
Each flavor or variation counts as a separate product, giving you incredible flexibility to grow your business.
What Foods Can You Make and Sell?
The Good News: Colorado allows a wide variety of delicious treats! You can make foods that are non-potentially hazardous (don't require refrigeration for safety), including:
Baked Goods
- Cookies, muffins, and cakes (without cream or custard fillings)
- Breads and pastries
- Fruit pies and empanadas
- Tortillas
Sweet Treats
- Candies like fudge, toffee, and cotton candy
- Honey and preserves
- Jams, jellies, and fruit butter
Savory Options
- Pickled fruits and vegetables (with pH of 4.6 or below)
- Roasted coffee beans
- Nuts and seeds
- Dry spices and teas
- Dehydrated produce
Special Products
- Up to 250 dozen whole eggs per month
- Buttercream made with ghee or vegetable oil (butter-based buttercream is not allowed)
- Freeze-dried produce
- Flour and similar dry goods
What You CAN'T Make:
Foods that are potentially hazardous and require refrigeration or specialized processing, including:
- Any meat products (bacon, jerky, poultry, fish)
- Baked goods with cream, custard, or meringue fillings
- Cakes with traditional buttercream frosting (unless made with ghee/vegetable oil)
- Sauces like barbecue, hot sauce, or salad dressing
- Beverages (except roasted coffee beans)
- Fresh cut fruits and vegetables
- CBD or THC products
Step-by-Step: How to Get Started
Step 1: Complete Required Food Safety Training
Colorado requires all cottage food producers to complete food safety training before starting their business. You have three options:
Option 1: Colorado State University Extension Course
- 3.5-hour course specifically designed for cottage food producers
- Available online or in-person for around $40-50
- Certificate valid for 3 years
- Contact cottagefoods@colostate.edu for information
Option 2: Food Handler's Card
- Available online at statefoodsafety.com for $10-15
- Quick and convenient option
Option 3: Local Health Department Training
- Some local agencies offer classroom-style training
- Contact your local public health agency for availability
Step 2: Set Up Your Business
Unlike many states, Colorado doesn't require a cottage food license, but you'll still need to:
- Register your business name if different from your legal name
- Get a local business license (check with your city/county)
- Register with Colorado Department of Revenue for tax purposes
- Consider getting liability insurance (highly recommended)
Step 3: Perfect Your Products and Labels
Every product must be properly labeled before sale. All cottage foods must be packaged and labeled with specific information including:
Required on Every Label:
- Product name
- Your name and home address
- Phone number or email address
- Date the food was produced
- Complete ingredient list
- Required disclaimer: “This product was produced in a home kitchen that is not subject to state licensure or inspection and that may also contain common food allergies such as tree nuts, peanuts, eggs, soy, wheat, milk, fish, and crustacean shellfish. This product is not intended for resale.”
Important Labeling Rules:
- You cannot label products as “allergen-free” due to potential cross-contamination
- To use “organic” on the main label, you need USDA certification
- You can list individual ingredients as “organic” without certification
Where and How Can You Sell?
Colorado's cottage food laws are flexible when it comes to sales, but there are specific rules:
Where You CAN Sell:
- From your home
- At farmers markets and craft fairs
- Online within Colorado (internet sales are allowed!)
- At roadside stands
- Through community-supported agriculture (CSA) programs
- At the point of sale, display a sign with the required disclaimer
Where You CAN'T Sell:
- To restaurants or grocery stores (no indirect sales)
- Outside of Colorado (no interstate commerce)
- For catered events
- Products cannot be resold by others
Special Considerations:
- You can use designated representatives to sell your products, but they must be knowledgeable about the products
- All sales must be to “informed end consumers” who receive product information
Important Safety and Business Rules
Kitchen Requirements:
- Use your primary residence kitchen
- You can also use other private, public, or commercial kitchens
- Keep detailed records of each batch made for sale
- Maintain clean equipment and good sanitation practices
Special Rules for Pickled Products:
If you're making pickled items, food safety is crucial. Colorado offers free pH testing for cottage food producers making chutney, kimchi, pickled fruits/vegetables, pickles, relish, sauerkraut, and fruit/vegetable vinegar. This testing ensures your products have the proper acidity (pH 4.6 or below) to prevent harmful bacteria growth.
Tax and Business Considerations
Income Limits and Taxes:
- $10,000 net revenue limit per product/flavor
- Your business is subject to income and sales tax
- Keep detailed records of sales and expenses
- Consider consulting with an accountant for tax planning
Getting Help:
Colorado offers numerous resources for small business owners:
- Colorado Small Business Development Centers
- SCORE mentoring
- Local economic development associations
Common Beginner Mistakes to Avoid
- Skipping the training: You legally cannot sell without completing food safety training first
- Incorrect labeling: The required disclaimer must be exact – don't paraphrase it
- Selling prohibited foods: Stick to the approved list, even if your item seems “safe”
- Exceeding the $10,000 limit: Track your net revenue carefully for each product
- Selling out of state: All sales must stay within Colorado
- Not keeping records: Document everything for tax and safety purposes
Ready to Start Your Colorado Cottage Food Business?
Colorado's cottage food laws are designed to help small entrepreneurs succeed while maintaining food safety. The combination of no licensing requirements, flexible sales options (including online!), and the unique per-product revenue limits makes Colorado one of the best states for starting a home food business.
Key Takeaways:
- No license required – just complete food safety training
- $10,000 net revenue limit per product (not total business)
- Internet sales allowed within Colorado
- Direct sales to consumers only
- Proper labeling is crucial for legal compliance
Remember: To confirm if your specific product is eligible, contact cdphe_mfgfd@state.co.us. The Colorado Department of Public Health and Environment is there to help you succeed safely.
Take that first step toward turning your culinary passion into profit – Colorado's cottage food laws are waiting to help you succeed!
Disclaimer: This information is for general guidance only. Food laws can change and vary by location. Always verify current requirements with the Colorado Department of Public Health and Environment and your local authorities before starting your cottage food business.
