How to Start a Cottage Food Business in North Dakota: No License, No Inspection, No Sales Cap and the Required Home-Kitchen Sign

If you searched for a north dakota cottage food license, you have probably found conflicting answers. Here is the short version: North Dakota does not issue one. Under North Dakota Century Code 23-09.5-02, no state agency or political subdivision may require licensure, permitting, certification, inspection, packaging or labeling for cottage food. The chapter also contains no dollar sales limit. What the law does require is a specific sign at the point of sale, direct sales to informed customers, and limits on which products you can make. This guide walks through what to gather, how to set up the business, and where people usually go wrong.

What the North Dakota Cottage Food Law Says

Chapter 23-09.5 is the rule set that governs home-produced food sold in North Dakota. Read the core provisions before you make anything, because the details decide what you can sell and how.

• No licensure or inspection. The chapter bars state and local governments from requiring a license, permit, certification, or inspection for cottage food.
• Direct sales only. You must sell directly from the operator to an end consumer for home consumption. Approved channels include your farm, ranch, a farmers market, a farm stand, your home kitchen, or delivery to the customer.
• No food establishment sales. You may not sell to or use your product in any food establishment, processing plant, or food store. The one exception is whole, unprocessed fruit and vegetables.
• Informed customers. The buyer must be told the food is not licensed, regulated, or inspected.
• Meat and poultry limits. Uninspected meat is not allowed. Interstate poultry sales are not allowed. Uninspected poultry is allowed only if you raised and slaughtered no more than 1,000 birds that year and do not buy or sell other poultry.
• Refrigerated items. Cream, custard, meringue, cheesecake, pumpkin pie, and cream cheese products need safe-handling instructions and a disclosure of how they are transported and held frozen.

The sign requirement is the one rule every seller has to follow. Subsection 8 says the point-of-sale sign or label must read:

“This product is made in a home kitchen that is not inspected by the state or local health department.”

Note that subsection 1 bars labeling requirements for cottage food, while subsection 8 requires this sign. Those two provisions sit in tension. Until you get a clear answer, the safe approach is to display the sign exactly as written. The Questions to Confirm With the Agencies section below explains how to confirm the question with the agency.

Complaints about cottage food can still be investigated under North Dakota Administrative Code 33-33-10-04. The older rules in 33-33-10-01 through 33-33-10-03 were repealed effective October 1, 2021, so older articles and forum posts may describe rules that no longer apply.

Materials and Ingredients You Need

You do not need much to start. Gather these items before you begin:

• A written product list. Name each product, its ingredients, and whether it is shelf-stable or refrigerated. This list is the basis for your compliance check.
• Tested recipes with a yield. Record ingredient weights or volumes and how many units each batch makes. Consistent recipes make pricing and customer expectations easier to manage.
• Your ingredient sources. Keep receipts or supplier information. Records help if a complaint is ever investigated.
• Printed signs and labels. Use the required sign text word for word. Add your business name and contact information.
• Refrigerated-item instructions. For any cream, custard, meringue, cheesecake, pumpkin pie, or cream cheese product, write the storage and handling directions your customer needs.
• A sales log. A notebook or spreadsheet works. Record the date, product, quantity, price, payment method, and sales channel.
• A FirstStop account at firststop.sos.nd.gov if you plan to register a trade name or an LLC.
• A sales tax permit application through ND TAP if your sales are taxable. Start that process early, as explained below.

Step-by-Step: Starting Your North Dakota Cottage Food Business

1. Confirm each product fits the chapter. Go through your product list and cross out anything that falls outside the rules. Uninspected meat is out. Poultry needs the 1,000-bird limit and the no-resale rule. Anything you intend to sell to a restaurant, café, or grocery store is also out, unless it is whole, unprocessed fruit or vegetables. If a product is borderline, do not sell it until you have confirmed it with the agency listed in the Questions to Confirm With the Agencies section.

2. Decide how you will organize the business. Many home sellers operate as a sole proprietor, which requires no state entity filing. If you want a separate legal entity, North Dakota charges $135 to file Articles of Organization for an LLC through FirstStop. LLCs must file an annual report with a $50 fee, due November 15 each year. The state levies no franchise tax on LLCs. An LLC taxed as a partnership or disregarded entity passes income through to its owners, who pay North Dakota individual income tax at 0 percent, 1.95 percent, or 2.50 percent depending on bracket. This is general information, not tax advice. Talk with a CPA before choosing a structure.

3. Register a trade name if you sell under a name other than your legal name. A trade name is any name a sole proprietor or other business uses that is not its own legal name. Registration costs $25 through the Secretary of State’s FirstStop portal. Registration must be renewed every 5 years, and the registration grants exclusive use of the name within North Dakota only. If you want to hold a name before you file, a name reservation costs $10 and lasts 12 months. Renewals are available in successive 12-month periods.

4. Apply for a sales tax permit if your sales are taxable. Any business making taxable sales must hold a sales and use tax permit from the Office of State Tax Commissioner, applied for through ND TAP at tap.tax.nd.gov. The state sales tax rate is 5 percent, plus any city and county taxes that apply. Apply about 30 days before your first sale. Whether your particular products are taxable is a question for the Tax Commissioner, so confirm it before you collect tax.

5. Print the required sign and place it where customers will see it. Use the exact subsection 8 wording quoted above. Post it at every point of sale, including your table at a market, your farm stand, and any delivery paperwork. A sign on your website or social media post is a useful addition, but it does not replace the point-of-sale sign.

6. Prepare refrigerated-item instructions. For cream, custard, meringue, cheesecake, pumpkin pie, or cream cheese products, write clear handling instructions. Include how the product is transported and how it should be held frozen if you deliver it. Attach these instructions to every package or pickup.

7. Set up your sales channels and tell customers the truth about the product. Sell directly to the end consumer. Your pitch must make clear the food is not licensed, regulated, or inspected. Flea markets and craft fairs are exempt from the transient merchant license, and farm products are excluded from that license. Still, confirm the rules for any event location before you sell there.

8. Check local rules that the state chapter does not cover. The state exempts cottage food from licensing, but cities license specific activities only, and counties do not license businesses. Home-based businesses can still be affected by zoning or neighborhood rules, which are set locally. Check with your city or county planning office about home occupation rules before you start selling from your house.

9. Plan for employees before you hire anyone. Workers’ compensation in North Dakota is a state monopoly administered by WSI (WorkForce Safety & Insurance). If you hire anyone to help with production or sales, you need to address WSI coverage before that person starts. A solo operator does not face this requirement in the same way.

10. Keep records and review them every quarter. Maintain your sales log, ingredient receipts, and tax filings. Once a quarter, compare your product list to your actual sales to confirm nothing has drifted outside the rules, such as a new product sold to a café.

Tips for Staying Compliant

• Keep the product list short at first. A narrow menu of shelf-stable items is easier to track and easier to explain to customers.
• Write your sign before you write your marketing. The sign is mandatory. Your ads, social posts, and product descriptions should be consistent with it.
• Keep a copy of the statute with your records. Chapter 23-09.5 is short. Having the text on hand helps when customers or officials ask questions.
• Price for the real cost of compliance. Sign printing, label stock, a sales log, and any tax or entity filings are costs to build into your prices.

Common Mistakes to Avoid

• Believing there is a license to apply for. There is no North Dakota cottage food license, so there is no license number to print and no renewal date to track. Filing a trade name or LLC is a registration, not a license.
• Assuming the law sets a sales cap. The chapter contains no dollar sales limit. Do not repeat claims from older articles that describe one.
• Selling to a restaurant, coffee shop, or grocery store. The chapter prohibits sales to or use in any food establishment, processing plant, or food store, except whole unprocessed fruit and vegetables. A wholesale order from a local shop is a common way sellers end up outside the law.
• Leaving out the sign or changing its wording. The sign is required at the point of sale. Paraphrasing it or leaving it off a table at a market is a compliance gap.
• Failing to tell buyers the food is uninspected. The customer must be told the food is not licensed, regulated, or inspected.
• Selling uninspected meat or exceeding the poultry limit. Poultry sales are capped at 1,000 birds raised and slaughtered in a year, and you cannot buy or sell other poultry under that exception.
• Shipping across state lines with poultry. Interstate poultry sales are not permitted under this chapter.
• Skipping refrigerated-item instructions. Cream, custard, meringue, cheesecake, pumpkin pie, and cream cheese products need handling instructions and a transport and frozen-holding disclosure.
• Relying on outdated sources. Third-party sites often describe the 2019 to 2020 version of the rules and may be stale.

Expected Results

Results vary widely, and no one can promise a specific income. Many home sellers start with a small set of products, sell at farmers markets or a farm stand, and grow through repeat customers and word of mouth. Those outcomes are common enough to plan around, but they are not guaranteed. Your results will depend on your products, pricing, local demand, and how consistently you follow the rules.

Keep your product claims modest and accurate. Describe what the food is, what it contains, and how to store it. Avoid health, disease, or treatment claims. The FDA does not accept those claims for ordinary foods without substantiation, and a claim on a home-kitchen label can draw unwanted attention. Stick to plain descriptions such as ingredients, flavors, and serving suggestions.

Questions to Confirm With the Agencies

Some points in this guide require confirmation from the agency that handles them. Do not treat any of the following as settled until you have heard from the right office:

• The labeling question. Ask the North Dakota Department of Health and Human Services how subsection 1 (no labeling requirement) and subsection 8 (required sign) fit together for your products.
• Whether your products are taxable. Ask the Office of State Tax Commissioner, which you can reach through tax.nd.gov.
• Filing timelines. The Secretary of State does not publish a guaranteed processing time for FirstStop filings. Call Business Services at (701) 328-2900 for current timing before you plan a launch date.
• Local zoning and home occupation rules. Confirm with your city or county planning office.

Useful Resources

• North Dakota Secretary of State, the home of business filings and trade name registration
• FirstStop, the online portal for filing
• Business search, to confirm that your name is not already in use
• North Dakota Office of State Tax Commissioner, for sales tax questions
• North Dakota Small Business Development Centers, hosted by the University of North Dakota Nistler College of Business and Public Administration, for free or low-cost planning help
• SBA North Dakota District Office, for federal small business resources

Disclaimer

This article is informational content about North Dakota business formation and cottage food rules. It is not legal or tax advice. Laws, fees, and agency practices change. Before you launch, confirm current requirements with the relevant agency and consider speaking with a qualified attorney or CPA, especially if you plan to hire employees, form an LLC, or sell at a large volume.