Hi everyone,

Just thought I would share this story that my Wilton cake decorating teacher told me.
I make cakes for my family and friends but that about all. It is a very expensive hobby when you don't sell them, but I love doing it too much and everyone always tells me to start selling them. ( I don't think I would have the time for that anyway, making cakes for my family and friends keeps me very busy)
Anyway, I started to think about it, and told my teacher.
She told me that one of her past students started selling her cakes out of her house. She just did it part time, so in order to get a little more business, she decided to put an ad in the paper.
The very next day after the ad came out, she had a knock on her front door. Guess who it was?
Yep! The Health Departement.
According to Michigan Law, you cannot bake cakes out of the same kitchen that you cook in, so they fined her $15,000! $15,000! Unbelieable! I felt so sorry for her! she had to give it all up!
Needless to say, I will just stick to giving them away to family and friends. (There's no law against that, YET!)
So beware anyone who is thinking about this. Check with your state laws first!
mcginnis

Same in Georgia. My inspector told me that she had recently busted several people in our area. You can make cakes for money but you can't advertise in any way. I think she basically tells them to stop though. The fines come if you don't stop.

Ouch! That's horrible! Thanks for the warning! I'm in Ohio, and I'm sure they have similar laws here. I don't advertise at all, and I guess I won't start! all of my sales stem from word of mouth. I work full time anyway, so I don't really have alot of spare time to do many cakes. Nice to know about the fine, I will certainly steer clear of that!

That's how it is in California,, if you sell it, it has to be prepared in a commercial kitchen..I think it was the ad that made them go to her house and not that someone complained about her. Poor woman.. $15,000 is a lot, unless you are Martha Stewart. That's why I just give my cakes as a present. No one has complained to me about that yet.

Hard to feel sorry for someone who posted a newspaper ad for an unlicensed business. A newspaper ad is a pretty bold move. I do sympathy for the amount of the fine-Ouch!!!

Yeah, OUCH..that IS a steep fine!

Yes. I agree. It was a grave mistake to post an ad in the paper. She obviously did no research on the subject. It's really risky to sell cakes from your own kitchen. But I feel sorry for her $15,000 fine...although that could be an exaggerated story by this time. Any fine is too much.

WOW thats a lot of money.

WOW...a $1500 fine

I also live in Ohio but have done some research. There is also another post about it for people who live in Ohio. I will post it for anyone else who lives in Ohio and is considering the idea.
http://cakecentral.com/modules.php?name=Forums&file=viewtopic&p=135083#135083

I advise locally main by word of mouth, but I do have a few flyers out there too.

My best advise is to check everything out before you jump in! Especially if you want to avoid fines or even tax penalties.

Wow, that is crazy, does anyone know the laws of florida. I called the county and they said is all I have to do to get a business license is pay a fee and they would direct me elsewhere, tax office, etc. I don't really think who I spoke to knew a whole lot about food business though.. Just wondering if you can bake out of your home kitchen in florida.

missyjo - send pinkbunny a pm. I think she's in florida, and setting up a licensed business to boot!

I can't imagine a fine of $15,000. That is hard to believe. Now $1,500 maybe. Either way poor thing.
Judy

I believe Florida is the same way-you have to have a separate kitchen. I'll have to do some research today on all the specifics. I'm curious now....

Yeah, that is my fear! I just keep up to date on my Food Handlers Card. I have worked in the food business for about 17 years so I am very aware of what is required/expected of me.


I do not however run a business because I know what it would entail and I just do not have the funds for that. I do not advertise. I think that was the woman's big mistake...she advertised!

I make cakes for family and friends. I do get orders for cakes from my DH's work only for the fact that they know me and him of course. I know that all the people that eat the cake don't know me but I am a trusted source and the person who orders the cake from me trusts me. Other than that, I don't solicit orders from people I don't know. Sure, I'd love to advertise on a billboard in a community center or grocery store that I make cakes but I'm a pretty smart person and know that means big trouble.


Amy

Hi everyone,

After reading the responses, I questioned the amount of 15,000 and asked my teacher again.

She told me she was pretty sure it was that much, because it stunned her when her student told her how much it was. Also, her student told her that she had to sell everything to try and help pay for the fine, and it wasn't even near enough to do that ! The teacher's not sure where she went from there.

However, whether it's $150, $1,500 or $15,000 a fine is a fine! No thank-you!
The state of Michigan gets enought money from me anyway in taxes! ha ha,
Wait, that's not funny either

Have a Nice Day!
mcginnis
(Lisa)

Florida has tons of guidelines, I checked into it at one point because my borther in law wanted me to go into the business, way too much red tape!

I'm probably on the verge of being banned because people don't like what I have to say, but I'm gonna say this anyway.

If you are selling cakes, cupcakes, chocolate candies, etc. for money, then you are running a business. Whether you want to admit it or not. it only takes one person getting upset because of their order not being what they wanted or expected, to turn you in. Then YOU could be the one paying a fine.

Don't think that because you don't have a license or you don't advertise, that it's not a business, when money is involved.

And yes, it's highly possible that there was a fine of near $15,000. Whether it was reduced or not, who knows?

Sure it may be deemed a business in some people's eyes but legally some of us are not a business. We do this for fun and or a hobby. Some of our family and friends insist on paying us for our cakes because they know the time and ingredients put into it. Yes, it's nice getting paid for all that hard work and creativity but there is NO contract drawn up, no deposit (maybe for wedding cakes if you ARE a business there should be a deposit) no forms to sign, no binding contract whatsoever!!.....blah blah blah!!! I do not consider myself a business if someone comes to me and asks for a cake!

I don't have any interest in going through all the hoopla to get a business at this point, not with two small children and my husband about to deploy so to continue to do this as a hobby that people insist on paying me for then that's what I'll continue to do.

My kudos for those who have made their hobby and love for cake decorating into a business. It works for them and I'm happy for them!


No reply necessary!!!!!


Amy

My state would disagree with you, cakemommy. If you sell a product made in your home, you're running an illegal business, maybe a small one, but a business nonetheless. The only benefit that comes from not advertising is keeping yourself under the radar so those that police illegal businesses will be less likely to find you. Advertising or not advertising is not what defines a business, nor does your clientele. Of course this all depends on where you live, but I think more often than not, home food businesses are *supposed* to be regulated by the state, city, or county, no matter how much you sell, if money or anything of monetary value changes hands.

your right alimonkey. In PA you are not allowed to bake out of your house, however if you are wholesaling, you can because you fall under the dept. of agriculture and they let you do that. I have been running an "illegal" business for 3 years, and have been word of mouth, flyers, website (no pricing) or cards. I still claim everything on my taxes even though I am not registered, so I know I'll never get in trouble with the IRS!!

Hi everyone I live in Michigan and yes it does carry a very big fine not sure how much but I was led to believe it is so heavty you dont want to have one, and as far as run a business illegally no it is our hobby for friends and family and they are just donations to cover the cost.!!!!

Well since I got a reply when I specifically didn't ask for one then I must reply as well...


I'd like to find or take again a poll on who here on Cake Central actually runs a LEGAL business out of their homes! I would then think if this site is in partial geared toward the home cake decorator then those that are a business or work outside of the home decorating and selling cakes should pay a small fee to the administrators of this site for being allowed to post the cakes they sell!!! By posting those cakes I see it as advertising!!!!! Correct me if I'm wrong, but advertising isn't entirely free is it?????

I certainly don't consider myself a business if I am lucky enough to make one cake a month. Sometimes I can go for months without anything so.....no business here.



Amy

My point was only that whether you are a business or not does not depend on whether you think you are one, it's whether you sell stuff. If you sell something and you are not a legal business, then by legal definition, you are an illegal business. Technically, if you are in a state where it's illegal to run a food business out of your home kitchen, you can be fined whether you sell one cake or 100, you just have a much much much much much much.... smaller chance (virtually nil) if you only sell the rare cake to family and close friends. However, that doesn't make it any more legal for you to do so. The exception would be if your friends/family are only giving you money for the materials and not a single penny for your time. The minute you charge for your time, there is a service provided and paid for, and an illegal business is born.

I am by no means making any judgements about illegal cake businesses. I am in the same boat myself. I have sold less than a dozen cakes in the last year, but that would be no defense if somebody at one of the parties turned me in to the health department. That's a risk I take, and I can minimize it by only doing cakes when I will know most of the people in attendance at the party.

I responded because ignorance is no defense of the law, and I consider it irresponsible to give people what basically amounts to the legal advice that "It doesn't matter that you charge money, if you do the cakes for fun, and only for friends and family, it's not really a business so you have no chance of getting fined."

(off my soapbox now, sorry)

BTW - I wouldn't call posting cake pics advertising on this site, since the chances of a fellow cake decorator wanting me or anybody else on this site to make a cake for them are pretty much non-existent.

Wow!!! I am so surprised at how many business degrees we must have here on CC!! Research well done and thank you for all the unsolicited information. I'll keep that in check and reference it next time I have a question about any business issues.

I see now that we have differences of opinions about cakes made out of legal Health Dept. inspected/approved kitchens and home kitchens. All in all, we all here on CC like to make cakes and we happen to have people who want to pay us for our cakes. I certainly don't think those people who solicit us are going to turn us in.

It's got nothing to do with degree's. If you don't want people responding to a post or a thread, then the best way is not to post it.

If you don't want help from people who have "legitimate" businesses then that's fine and up to you. I'm sure there are many more here who actually do care that there is something to lose.

That's all I have to say. I'd rather give my time to teaching my child what's right and wrong in this world, then defending myself and my words.

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I will say this much.......I'm surprised myself about the lack of ban....and I don't think it has to do with others not liking what you say.........its more of "how" you say it!

I don't think it was necessary to be so condescending or disrespectful to anyone.

Anyone here who is doing this "cake thing" legally how wonderful for you and I wish you all the best. You obviously are determined in order to put in all the time and research.

I however will continue to decorate cakes as a hobby and enjoy it and enjoy (if I am still allowed) everyone here on Cake Central.


Amy

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Well, Back to the topic at hand. I live in California and have checked into the laws in my county. I am in County, not city so the laws vary. However, I was able to obtain a buisness licence to sell baked goods from my home. I went to the county health department to find out what I needed to do. At first, over the phone I was told that you can not operate out of your home kitchen. So I found a commercial kitchen I could rent hourly. Then when I went to talk to the health department abouth getting a health permit they said I didn't need one.

Basically in my county if you are not operating a food buisness where customers can come to your establishment and order directly it is considered a private sale and there are no health regulations. My husband and I spent a good hour talking to the guy at the health department and he kept telling us the same thing. It has nothing to do with advertising. You can advertise fine as long as you have a buisness license, which is seperate from a health department license.

The only time that you have to have a health permit is if you are going to sell your product at a organized city or county event or if your product will be for resale, like if you sell to a restaurant.

Now, the laws vary by county, city, state. You have to check your local health department to find out regulations in your area. But it is possible to sell legally from your home kitchen with a buisiness license.

Just my two cents.

Euphoriabakery, that's a great situation you have there. It would be nice if it were like that everywhere!!!!

Wonderful!!!!! Much luck to you!!

I think this post should be locked..and as I have read the whole thing but tried my best to stay out of it..I suppose I am in total contempt as well cakemommy..as I decorated in the same manner as yourself for a long time b4 getting licensed...I knew it COULD be considered as illegal..and when I first went to my local health dept to see about "getting legal"..I was advised to as little as I was doing wait till I was really up and running and that they werent really out gunning for us small guys who sold a cake here and there..I know this person was really going against the law. ANd it might not have been good advice as some place would be different.. But who doesnt in some respect do what others might not approve of????. Who has never used a handicapped public restroom? Or eaten one grape in the supermarket if the last 5 bunches you bought were sour..just to see if they were too before buying them?If you asked for an opinion I might have said more..or offered advice..I saw you didnt tho...so you alone are responsible for your actions and I saw no need like some others to PUSH my opinion on you.

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