How to start a home bakery in Michigan: a step-by-step launch plan (2026)

To start a home bakery in Michigan, you don't need a license, a permit or an inspection. Michigan's cottage food law lets you bake shelf-stable foods in your own home kitchen and sell them directly to customers, up to $50,000 in gross sales a year. Your job is to pick allowed products, label them correctly, clear local rules, and keep records.

That's the short version. Below is the full launch plan, in the order you'll actually do it, with a checklist at the end you can print and work through. For the complete legal picture, keep our Michigan cottage food law guide open in another tab.

Step 1: Check your products against MDARD's list

Everything else depends on this. Michigan's cottage food law covers foods that don't need refrigeration or other time and temperature control. MDARD (the Michigan Department of Agriculture and Rural Development) publishes a "What can I make?" list, and it's more specific than most people expect.

MDARD's list says these baked goods are allowed:

• Cookies, breads, quick breads and muffins
• Cakes, including birthday, anniversary and wedding cakes and cupcakes
• Shelf-stable pies and cooked fruit pies
• Breads with shredded hard cheese mixed into the dough, or with dried or freeze-dried fruit and vegetables
• Icings made entirely of shelf-stable ingredients

And these are not allowed:

• Pumpkin pie, custard, cream and meringue pies, and cheesecake
• Cream cheese frosting, or any frosting that needs refrigeration
• Breads with fresh or frozen vegetables, soft cheese, or large chunks of hard cheese
• Sourdough starter (the bread is fine; the starter itself isn't sellable)

If a product is borderline, email MDARD at MDARD-CottageFood@michigan.gov with your ZIP code and the recipe. Our full breakdown of what you can sell under Michigan cottage food law covers candy, jams, dry mixes and the rest.

Pick three to five products to launch with. A short menu is easier to cost, label and bake consistently. You can add more once you know what sells.

Step 2: Confirm your kitchen qualifies

The law requires you to make and store everything in your primary residence. MDARD's guidance says a house, apartment, condo or rental all count. A second home, motor home, group home, sorority or fraternity house, shed or barn doesn't.

A few practical points from MDARD:

• You can't rent a commercial kitchen and stay under the cottage food exemption. Using a licensed kitchen means you need a food establishment license instead.
• Your equipment doesn't need to be NSF-approved. Your regular oven and mixer are fine.
• Storage stays at home. Finished cottage food products must be stored only in your primary residence, not in a garage fridge at a friend's house or a storage unit.
• Private well? Use potable water and test it at least once a year.
• Septic system? MDARD recommends having your local health department evaluate it before you start, because bakery wastewater can strain a septic system.

Step 3: Clear local rules (zoning, HOA, DBA)

The state exemption doesn't override local ordinances. Your city or township can still have zoning rules about home businesses, customer traffic, signs or parking. Before you invite customers to your porch, check two things:

1. Zoning. Call your city or township's zoning or planning office and ask whether a home-based food business with occasional customer pickups is allowed at your address.
2. Lease or HOA rules. If you rent or have a homeowners association, read the rules on home businesses. These are private agreements, separate from the law, and they can be stricter.

Business name. If you sell under a name other than your own legal name (say, "Northside Crumb Co."), your county may require an assumed name certificate, often called a DBA. MDARD's FAQ says to check with your county government office. If you want an LLC, that's filed with LARA, not MDARD. Neither is required by the cottage food law itself.

Step 4: Decide on MSU registration (optional)

By default, every label must show your name and your physical home address. Many bakers don't love printing their home address on every cookie bag.

The law offers an alternative. You can register voluntarily with the MSU Product Center, for a one-time fee of up to $50. Once registered, your label shows your name, phone number and registration number (format C-000000000) instead of your address. The law also exempts your registration information from Michigan's Freedom of Information Act.

It's optional. For many people selling from home, the privacy is worth it. Our Michigan cottage food license guide explains why this registration isn't a license.

Step 5: Get trained and think about insurance (both optional)

Training. MSU Extension offers an online Michigan cottage food law training, funded by MDARD. It isn't required, but it's a structured way to learn the rules, and something concrete to mention when customers ask.

Insurance. Michigan's cottage food law doesn't require liability insurance. It's still worth a phone call to your homeowners or renters insurance agent, because a standard home policy may not cover business activity. Ask what's covered, what isn't, and what a product liability policy would cost for your situation. Some farmers markets and events set their own vendor requirements, so ask each one before you apply.

Step 6: Lock down recipes and costs

Before you set a single price, standardize each recipe:

• Weigh, don't scoop. Write every recipe in grams so each batch comes out the same and your ingredient list stays accurate.
• Record the yield. How many cookies, loaves or cupcakes does one batch make, and what does each weigh? You need the weight for your label anyway.
• Write down sub-ingredients. If you use chocolate chips, sprinkles or store-bought frosting, save the ingredient list from the package. It goes on your label.

Then work out what each item really costs you: ingredients, packaging, your time at a wage you choose, and overhead. We walk through the math with worked examples in how to price baked goods.

Step 7: Make compliant labels

The law says every cottage food product must be prepackaged and labeled before sale. No unlabeled cookies on a plate at the market. MDARD's labeling page lists what goes on the label:

1. Your name and physical address (no P.O. boxes), or your name, phone number and MSU registration number
2. Product name
3. Ingredients in descending order by weight, including sub-ingredients (for example, "chocolate chips (sugar, chocolate, cocoa butter, soy lecithin, vanilla)")
4. Net weight or volume, with the metric equivalent, such as "Net Wt. 3 oz (85 g)"
5. Allergens per federal rules. The nine major allergens are milk, eggs, wheat, soy, peanuts, tree nuts, fish, shellfish, sesame. Name tree nuts specifically ("almonds," not "nuts").
6. The statement Made in a home kitchen that has not been inspected by the Michigan Department of Agriculture and Rural Development. in at least the equivalent of 11-point type, in a color that contrasts with the background

Hand-written labels are fine if they're legible, in permanent ink and meet the size rule. For celebration cakes that can't carry a label, MDARD allows you to put all the label information on the invoice and hand it over with the cake. Smaller cakes go in a box with the label on the box.

The full walkthrough, with examples, is in Michigan cottage food label requirements.

Step 8: Choose packaging that protects the product and the label

Packaging has three jobs: keep the food fresh, carry the label, and look like something worth paying for.

• Cookies: clear heat-sealable bags or boxes with a window. Stickers on the back hold the full label.
• Bread: bread bags or paper bags with a window. Crusty loaves go soft in plastic, so many bakers use paper.
• Cupcakes and cakes: boxes with inserts. The label goes on the box.
• Jars (jam, granola): a front label with the product name and a back label with everything else.

Buy a small quantity first. You'll change your mind about sizes after your first few orders. Count packaging and labels as a cost per item, not "overhead," so your pricing stays honest.

Step 9: Set your prices

Price from your costs up, then sanity-check against what similar items sell for near you. A simple structure:

Price = (ingredients + packaging + your labor + overhead) × (1 + profit margin)

Then adjust for card processing fees if you take cards. Two Michigan-specific points:

• Sales tax. Michigan Treasury's guidance says bakery items (bread, cookies, cakes, pies, muffins and similar) sold without eating utensils are excluded from "prepared food," so they're generally not taxable. Handing out forks, plates or napkins can change that. Our Michigan cottage food sales tax article has the detail, and Treasury or a CPA can confirm your case.
• The cap. Your gross sales can't exceed $50,000 a year, or $75,000 if you sell products priced at $250 or more per unit (think tiered wedding cakes). Higher prices get more value out of each dollar under the cap.

Step 10: Decide where and how you'll sell

Since the law changed on March 24, 2026, you have more options than ever. All of them share one rule: direct to consumer only. No wholesale, and no consignment in coffee shops or stores.

What counts as "directly interact"? The law says it includes a face-to-face meeting or a virtual meeting where both sides can see and hear each other, like a video call. Email or a contact form alone doesn't clearly match that definition. The safe approach: offer every online customer the option of an in-person conversation or a live video call before they buy. If you're unsure about your setup, ask MDARD.

One more limit: MDARD says farm stops and retail markets can't act as a pickup point for pre-sold cottage food. Customers pick up from you, you deliver, or you ship within Michigan. See where to sell baked goods in Michigan and cottage food shipping and delivery rules for the details.

Step 11: Set up payments

You'll want at least two ways to get paid:

• Cash for porch pickups and markets. Keep a small float and a simple log.
• Card payments through a card reader, a payment app or an online checkout. Card processors charge a fee per transaction; Stripe's standard rate, for example, is 2.9% + 30¢. Build that into your prices.

Decide your policies before your first order, and write them down where customers can see them: when payment is due, whether custom orders need a deposit, your cancellation window, and what happens if someone doesn't show up for pickup.

Step 12: Keep records for the cap and for taxes

MDARD can ask you for written documentation of your gross sales, and the IRS will want to see your income. One simple spreadsheet or app covers both.

Track for every sale: date, product, quantity, amount, and payment method. Track for every expense: date, what you bought, and the receipt.

What that record feeds:

• The sales cap. Gross sales means the total you take in, before expenses. The cap applies per person: if two people in one household each run their own cottage food business, each gets the full limit, according to MDARD's FAQ.
• Federal income tax. Home bakery income goes on Schedule C. Once your net self-employment earnings reach $400 for the year, you owe self-employment tax too.
• Form 1099-K. Payment apps and online marketplaces must send a 1099-K when your payments through them exceed $20,000 across more than 200 transactions. Your income is taxable whether or not you receive one.

Don't rely on state income tax figures from memory or from a forum post. Ask a tax professional before your first filing season, especially if you have another job.

Step 13: Find your first 10 customers

Your first customers usually come from people who already know you. That's normal, and it's the fastest way to get feedback.

1. Tell your own circle directly. A personal text or message with a photo and a simple way to order works better than a general post.
2. Post a menu with one clear order link. Name, photo, price, pickup days. Put the link in your social media bio.
3. Do a small pre-order "drop." Offer a limited batch for a specific pickup day. It gives people a reason to order now and lets you bake to order instead of guessing.
4. Bring a labeled box to places you already go, like work, church, school events or your kid's practice, with a card showing how to order. You're looking for customers, not stockists: selling to a café to resell isn't allowed.
5. Join local community groups and follow each group's rules about selling posts.
6. Try one market or event to meet strangers. Ask the organizer about their vendor requirements first.
7. Ask every happy customer for one thing: a photo post, a review, or a referral.
8. Collect contact details with permission so you can tell people about your next bake without depending on one social platform.

Take notes on what sells, what people ask for, and what they balk at. Adjust the menu after your first 10 orders, not before.

Your home bakery launch checklist

Print this or copy it into your notes app.

Products and kitchen

• Every product checked against MDARD's "What can I make?" list
• Any buttercream made from one of the two approved lab-tested recipes, exactly
• Baking and storage in your primary residence only
• Well water tested (if you have a private well)
• Septic evaluation by the local health department (if you're on septic)

Local and paperwork

• Zoning checked with your city or township
• Lease or HOA rules checked
• DBA filed with the county clerk (if using a business name)
• MSU Product Center registration (optional, up to $50 one time)
• MSU Extension cottage food training (optional)
• Insurance conversation with your agent (optional)

Recipes, labels and packaging

• Recipes written by weight, with yields
• Sub-ingredient lists saved for every prepared ingredient
• Labels with name and address (or phone and MSU number), product name, ingredients, net weight with metric, allergens, and the required statement in 11-point type or larger
• Packaging chosen and costed per item

Selling

• Prices set from costs, checked against local prices
• Sales channels chosen (pickup, markets, online, delivery, Michigan-only shipping)
• In-person or live video option offered to every online customer before the sale
• Payment methods and order policies written down

Records

• Sales log (date, item, amount, payment method)
• Expense log with receipts
• Running total against the $50,000 cap
• Tax questions sent to a professional before filing season

Frequently asked questions

Do I need a license to start a home bakery in Michigan?

No. MDARD's FAQ says cottage food operations need no application, registration, license or permit from MDARD. You may still need local approvals (zoning, a DBA), and farmers markets can set their own requirements.

How much can a home bakery make in Michigan?

Gross sales can't exceed $50,000 a year, or $75,000 if you sell products priced at $250 or more per unit. Beginning October 1, 2026, MDARD may adjust these caps for inflation. See the Michigan cottage food sales limit explainer.

Can I sell my baked goods to a coffee shop or store?

No. The law prohibits consignment and wholesale. You can only sell directly to the person who'll eat the food.

Can I sell cheesecake or pumpkin pie from home in Michigan?

No. MDARD's list excludes both, along with custard and cream pies and cream cheese frosting, because they need refrigeration.

Can I sell baked goods online in Michigan?

Yes, since March 24, 2026, as long as you sell only to consumers in Michigan and give each customer an opportunity to directly interact with you (in person or by live video) before the sale. Our guide to selling baked goods online in Michigan covers the setup.

Do I need an LLC to start a home bakery?

No. The cottage food law doesn't require any business structure. If you want an LLC, that's filed with LARA; ask a lawyer or accountant whether it makes sense for you.

This is general information, not legal advice. For edge cases, contact MDARD at MDARD-CottageFood@michigan.gov (include your ZIP code) or 800-292-3939.

Sources

• MCL 289.4102, Michigan cottage food law (as amended by 2025 PA 51)
• MDARD: Cottage food
• MDARD: Getting started and FAQ
• MDARD: What can I make?
• MDARD: Labeling
• MSU Product Center: Cottage food business voluntary registration
• MSU Extension: Online Michigan cottage food law training
• Michigan Department of Treasury: Changes to the tax treatment of prepared food
• IRS: Self-employment tax
• IRS: Understanding your Form 1099-K