For those that are doing cakes/cupcakes in your home, I have a few questions. I don't do a lot of cupcakes or cakes, but my friends are running me ragged some weeks with kid's bday parties etc. They all rave about how good my cupcakes are. I can't sell them w/o a license, so I am doing it for free and it's a little more time consuming than I thought and I don't feel I can continue to do it for free.

I live in TN, where home-based bakeries are legal. Do you have to have liability insurance, is it really considered a "business" because I don't want to open a business, I just want to get paid for my hobby on occasion. Also, I have a dog and a cat, but I put them in the master bedroom when I'm baking and my house is super super clean.

Tell me about inspections, what you have to have? Is it worth it or do I just keep doing it for free?

I don't know about TN but some states don't allow you to have a pet in the house at all. I would imagine that liability insurance is a necessity. You can call your local state office and they will tell you what you need to start your business.

Check with your homeowners policy & see if you can add your business there. It's simple quick and not much more in cost.
Call the TN department of Ag & the Dept of health & check with them .. it is always best "to get it straight from the horse's mouth"....

As for being worth it only you can tell that in time. I am happpy & still love my business 8 years later :0)

Thank you for all of your replies. I appreciate the advice and suggestions. I suppose I will just remain a hobby-baker. I have Rheumatoid Arthritis and have to work at my own pace since my hands get so sore...I doubt I can afford to start an actual "business" as I make only a few cakes a year, more cupcakes than anything for my friends and family. Someone asked me today to do a cake and I don't know her that well so I told her I couldn't. I can't keep doing it for free unfortunately, but I understand I can't charge either.