New Texas Law Supports Cottage Food Businesses

Texas is a great state for opportunity. Around every corner, there is a chance to be a great business owner, or business person, farmer, rancher, restaurant owner, etc. However, food professionals in Texas include chefs, bakers, confectioners, or just the best-danged salsa makers on this side of the Rio Grande.

What is a Cottage Food Production Operation?

An individual, operating out of the individual's home

Many of the above professionals in the food world cannot afford a big, fancy kitchen or a standalone bakery or restaurant; they create their masterpieces in their home kitchens.

These are Cottage Food Producers.

You might think home kitchen products are unsanitary, but cottage food producers follow strict standards; however, they are exempt from the requirements of a food service establishment.

These cottage food production operators have to complete an accredited food safety education or training program for food handlers.

SB 541: Key Changes You Need to Know

Senate Bill 541, passed in May 2025, expands opportunities for cottage food producers

This new law expands the limits on what can be sold, increases the income limit for cottage food production to make more money. It also requires labeling and safety requirements for certain types of food.

Higher Sales Limit - the cap was raised from $50,000 to $150,000
More Food Options - Most food is allowed except for meat, poultry, and seafood, ice products, low-acid canned goods, CBD/THC products, and raw milk products.
New Sales Opportunities - shelf-stable items can be sold to third-party vendors.
No More Local Permits or Fees - Local governments or health departments cannot require those in the cottage food production industry to obtain a license, permits, or pay fees to sell.

Labeling and Safety Rules for Cottage Foods

The new labeling requirements for cottage food production must include:

Producer information, preparation date, disclosure that it was made in a private residence without inspection.
Safe-handling instructions for certain foods, like a baked good that requires refrigeration.

The law goes into effect on September 1, 2025.

Benefits of SB 541 for Texas Small Food Businesses

The passage of this bill is going to be great for those small business owners in the food industry. They will be able to grow, and the public will have access to locally lightly processed foods, while keeping safety standards.

These new laws are important because they give more freedom and sales opportunities and protect them from overregulation.