Illinois Cottage Food Operation
"Illinois has two different laws in place that allow the sale of homemade food. This page covers the older law, which is for “cottage food operations”. The newer law is for “home kitchen operations,” which you should use if you want to sell baked goods outside of farmers markets. Aside from being able to sell outside of farmers markets, the newer law is more restrictive than this older one.
This law only lets you sell cottage foods at a farmers market*, and you can sell up to $36,000 or products per year. The startup cost for your cottage food operation could be as low as $100, but it could be higher if your local health department has decided to charge fees for registration and an inspection. This law is also very specific about what types of food are allowed, but the most recent amendment allows the health department to approve more items.
In 2017, a new bill (HB 3063) passed which will improve this cottage food law in 2018 by allowing many more food items, and also by removing the sales limit. Products can still only be sold at farmers markets, though. You can read more about the changes here.
* Products with a locally-grown main ingredient can also be sold on the farm that grew the main ingredient, or delivered directly to the consumer."
Illinois Home Kitchen Operation
Illinois passed an amendment to their previous law, which is for “home kitchen operations” (PA 098-0643 aka HB 5354). This specialized law is only for bakers, and unfortunately, it is not available in many counties across the state. Before anyone can use this law, their county must create an ordinance to allow it, but ordinances can take awhile to get initiated and passed. This requirement also makes it easy for counties to prevent the law from taking effect in their area. Many health departments have little or no incentive to take the effort to make this law available in their area, so many people cannot use it. If a county does allow home kitchen operations, then all non-perishable baked goods can be made at home and sold directly to customers, either from home or elsewhere. Unlike any other cottage food law, sales are limited to $1,000 per month (rather than on a yearly basis). No registration or permit from the health dept is required, but other local permits may still be required. The older law (still in effect) is for “cottage food operations“, which may sell up to $36,000 of products at farmers markets. It’s technically possible to use both laws to sell up to $48,000 of goods per year. This law was started in direct response to 11-year-old Chloe Stirling getting shut down. In this way, it is similar to California’s law, which also got started after someone got shut down by the health dept. It only took a few months to pass this law, whereas it took about two years to pass California’s. However, this amendment to Illinois’ law is far more limiting than California’s.
Catering is a popular and competitive industry, but it needs certain licenses, and Illinois is no exception. Although there is no specific catering license needed, you will need several food and business licenses in order to operate a catering business in the state, with licenses in several different areas of food preparation.
State and Local PermitsRegister your business' name with the state of Illinois as a DBA (doing business as) and secure a federal tax identification number. You will also need a seller's license, which covers selling anything people can touch. The seller's license requires an application, identification that demonstrates you are an Illinois resident, and a $15 fee. Some areas of Illinois, such as Chicago, also have a similar process you will need to fulfill.
Food LicensingTo cook and serve eggs, meat and poultry, you will need an "egg breaker's" license, costing $200, and a Type 1 meat and poultry license, costing $50 annually, both from the Illinois Department of Agriculture. You will need to submit to an inspection of your cooking area to ensure that it meets health and sanitation requirements before you will be granted the license. To maintain the license you must submit to regular inspections over the life of the license.