post #16 of 16
It sounds complicated since the law has to cover as many situations as possible, but for cakes it's pretty straightforward. If you are an artisan bakery (80% revenues from bakery items, annual revenue under $1.8M) then you only need to collect state sales tax if you include utensils. If you are not an artisan bakery then any cake you make is subject to state sales tax regardless of utensils.

The part you quoted has to do with the definition of "prepared food", but any cake made by a grocery store or bakery would already count as prepared food since 2 or more ingredients have been combined to make the end product. The only time utensils come into play there is if you resell a food item someone else made -- if you don't heat it or mix it with anything else, you only need to charge state sales tax if you include utensils.
Edited by jason_kraft - 1/1/13 at 9:48pm