Home Bakery Permits & Licenses in Chicago, IL

Required for all LLCs. Annual report required separately (see below).

Applies to all LLCs. Online filing preferred.

File in each county where business operates. Home bakery typically in one county.

Home bakeries selling non-TCS foods (cookies, breads) qualify under Baked Goods exemption but still need local permit. Apply via county health department.

For home bakeries selling only approved baked goods (<$36,000 gross sales/year). Requires food safety training. Effective under 410 ILCS 650/. Updated sales limit July 1, 2023.

16-hour course + exam. Prerequisite for cottage food operations.

Home bakeries selling directly to consumers must collect and remit sales tax on taxable food items. Baked goods sold at retail are generally subject to sales tax unless exempt (e.g., certain unprepared foods). Registration is done via the Illinois Business Registration form (Form REG-1).

Required for all employers in Illinois. Must register using Form IL-7004 or online via MyTax Illinois. Applies even if only one employee is hired.

All employers with employees in Illinois must register with IDES. Employers pay unemployment insurance tax based on taxable wages. New employers typically pay a standard rate of 3.85% on the first $14,000 of wages per employee (2024 rate).

While not a tax per se, this is a mandatory annual compliance obligation for all LLCs. The filing includes a fee that supports state regulatory functions. Must be filed via the Illinois Secretary of State website.

Retailers selling tangible goods (including baked goods) in Chicago must obtain a Retail Business Tax License. Home-based businesses are not exempt. Tax is based on gross receipts. Registration via Chicago Business Tax Application.

Many Illinois municipalities require home-based businesses to register or obtain a home occupation permit. Chicago, for example, requires compliance with zoning code 2-12-010. Some jurisdictions impose a local privilege tax or fee. Check with city or county clerk.

All LLCs with employees must have an EIN. Even single-member LLCs may need one for banking or tax purposes. Can be obtained online at IRS.gov at no cost.

Required posters include Illinois Minimum Wage, Sexual Harassment Prevention, and Workers’ Compensation. Employers must keep them visible to employees.

Required for home bakers selling allowed cottage foods (e.g., breads, cookies, cakes) directly to consumers. Sales limited to $75,000 annually. License issued by IDPH. While not a tax, it is a prerequisite for legal sales and thus impacts tax eligibility.

Home bakeries producing and selling baked goods are considered food facilities and must register with the FDA under Section 415 of the FDC Act. Registration must be renewed every 2 years (biennially between October 1 and December 31 in odd-numbered years). Exemptions may apply under the "cottage food" rules, but only if operating under state-level cottage food laws and not selling across state lines.

All packaged baked goods must have accurate nutrition facts, ingredient list, allergen labeling (e.g., "Contains: Wheat, Eggs, Milk"), net weight, and business name/address. Applies to all home bakeries selling prepackaged items, even locally. Exemptions may exist for very small operations under the Food Allergen Labeling and Consumer Protection Act (FALCPA), but not for major allergens.

All advertising (websites, social media, packaging) must be truthful, non-deceptive, and substantiated. Applies to claims like "organic," "homemade," "all-natural," or health-related assertions. Home bakeries must avoid false origin or quality claims.

Employers must verify identity and work authorization for all employees using Form I-9. Employers must retain forms for 3 years after hire or 1 year after employment ends, whichever is later. Applies to all U.S. employers, including small businesses.

FLSA sets federal minimum wage ($7.25/hour as of 2024), overtime pay (1.5x regular rate after 40 hours/week), recordkeeping, and child labor rules. Applies to home bakeries with employees regardless of size. Some states (including Illinois) have higher minimum wages.

FMLA requires eligible employers to provide up to 12 weeks of unpaid, job-protected leave for qualifying medical and family reasons. Most home bakeries in Illinois will not meet the 50-employee threshold and are exempt.

Most home bakeries do not generate hazardous waste or require EPA permits. However, improper disposal of large volumes of waste oil or cleaning chemicals could trigger reporting. Normal kitchen waste and cleaning activities are exempt.

All LLCs registered in Illinois must file an Annual Report with the Secretary of State. The report includes business address, registered agent, and principal office information. Failure to file may result in administrative dissolution.

Home bakers operating under the Illinois Cottage Food Exemption must still obtain a Retail Food License from IDPH unless they qualify for the 'Limited Food Establishment' exemption. Most home bakers selling baked goods must renew this license annually by May 31.

Even if exempt under state cottage food laws, many local health departments require a permit for home-based food businesses. Contact your local health department for specific renewal dates and fees.

Sales Tax License does not expire but requires regular reporting. Most small businesses file quarterly. Bakers must file Form ST-100. Records must be kept for at least 3 years.

Chicago Municipal Code Sec. 4-8-010 et seq. limits home occupations to 25% of dwelling unit; cottage food operations allowed but must comply with zoning. Effective as of 2023 updates.

Chicago Code Sec. 4-8-030; home kitchens must pass plan review and inspection. CDPH supersedes state cottage food for city limits. Updated fee schedule 2024.

Chicago Municipal Code Chapter 4-4; LLCs register via BACPDatabase. Home bakery falls under "Retail Food" or "Home Occupation" category.

Cook County Food Code based on FDA model; home-based food ops require pre-op inspection. Distinguish from Chicago CDPH requirements.

Cook County Zoning Ordinance Article 10; many suburbs have own zoning (e.g., check specific suburb like Oak Park or Evanston).

Chicago Fire Code (77 Ill. Adm. Code 380); required for any food prep increasing fire load.

Chicago Building Code (IBC 2018 w/amendments); DOB review required for food facility alterations.

Illinois law requires all employers with at least one employee to carry workers' compensation insurance. Sole proprietors without employees are exempt. Applies to LLCs once they hire staff. Coverage must meet statutory requirements under the Workers' Compensation Act (820 ILCS 305/1 et seq.).

Not legally required by the State of Illinois for home bakeries, but strongly recommended. May be required by third parties (e.g., farmers markets, event organizers, or commercial kitchen leases). No state mandate exists for general liability coverage.

Not legally required by Illinois law for home bakers operating under the cottage food exemption. However, it is strongly recommended due to risks associated with foodborne illness or contamination. Not a substitute for compliance with food safety regulations.

Required under Illinois Vehicle Code (625 ILCS 5/3-706) if a vehicle is used for business activities such as deliveries. Personal auto policies may not cover business use. Commercial auto insurance is mandatory in such cases.

Illinois does not require a surety bond for home-based cottage food operations under the Cottage Food Exemption (21 U.S.C. § 393 and 775 ILCS 75/5). Registration with the local health department is required, but no bond is mandated. This applies to Class A and Class B cottage food operations.

Not legally required for home bakeries in Illinois. This type of insurance protects against claims of negligence or failure to perform services as expected. Not typically relevant for product-based businesses like bakeries unless offering custom design or event planning services.

Not applicable to standard home bakeries. Only required if the business obtains a liquor license to serve or sell alcohol (e.g., at a retail storefront or event). Home bakeries operating under the cottage food exemption are prohibited from selling alcohol.

While not required for all sole proprietorships, an EIN is mandatory for an LLC with employees or certain tax filings. Home bakeries structured as LLCs typically need an EIN regardless of employees due to entity structure.

A single-member LLC is disregarded for federal tax purposes and reports income on Schedule C of Form 1040. Multi-member LLCs are treated as partnerships and must file Form 1065. All LLCs must comply with self-employment tax rules under Schedule SE. Sales of baked goods across state lines may trigger additional reporting.

Required only if the LLC hires employees. Employers must withhold state income tax and file periodic returns. No annual renewal, but ongoing compliance required.

EIN itself does not require renewal, but businesses with employees must file federal employment tax returns. Even without employees, EIN is required for LLCs taxed as corporations.

LLC owners must make estimated tax payments if they expect to owe more than $1,000 in federal taxes. Payments cover income and self-employment tax.

Self-employed individuals in LLCs must make estimated state tax payments if they expect to owe $1,500 or more in Illinois income tax.

Home bakers may be subject to annual or biannual inspections by the local health department. Inspection ensures compliance with food safety practices, including storage, labeling, and preparation.

Businesses must keep records of all sales, tax collected, and expenses. Applies to all businesses collecting sales tax. Records include invoices, receipts, bank statements, and tax returns.

The Retail Food License issued by IDPH must be posted in a conspicuous location at the business site, even if home-based.

If a local health or business permit is issued, it must be visibly posted at the business location.

Employers must display posters including the Minimum Wage Law, Equal Employment Opportunity, and Family and Medical Leave Act. Available for free from DOL website.

Home bakeries with no employees are exempt from most OSHA requirements. Employers with employees must provide a safe workplace, display the OSHA poster, and report work-related fatalities or hospitalizations.

ADA requires reasonable access for people with disabilities. For home bakeries, this may include accessible delivery options, website accessibility (if selling online), and communication accommodations. Physical storefront is not required for compliance.

This is the same as the Annual Report requirement. Ensures the LLC remains in good standing. Must be filed every year regardless of activity.