I'm just starting with cake decorating for profit. I'm just selling to friends and family members. Can I do this without declaring myself a business and getting licensed and everything? I live in Arkansas.

First things first....Welcome to CC

Okay now on to the answer. Unless someone in Arkansas can give you all the legal specifics for your area, it is best to check with your Local laws. Every State, City, County, Parish,....etc is different. It is always better to educate yourself on the laws if you one day plan on making it a profitable business. Till then you will be safer keeping it a hobby. HTH

If homebased food business is not allowed in your state (as it isn't in mine) yes, keep it a hobby and that means NO ADVERTISING of any kind. I believe one of our members was busted when she innocently advertised in her local newspaper. My cakes are strictly thru word of mouth although I did have some business cards printed up to help spread the word .
www.vistaprint.com offers some nice and very inexpensive ones.
Good luck!

Welcome to Cake Central....I know for the most part it depends on where you live....and I also know that probably all cake decorators started out selling illegally (not all of course) many new decorators as not for money in return but a cake gadget that you have been wanting in exchange for a cake (that way you are not taking money)...its an idea...My Mom has given me money for a couple of cakes, and a friend of hers has as well.....and I am not legal (not possible in my state to do from home)....anyway I think my risk is relatively low and I certainly dont advertise....this is strictly a hobby for me...really all I want to do is birthday cakes and such for my family....but I have a hard time turning people down (nothing like working 3 hours on a cake to make $3)....if they like something they have seen me do.