ALABAMA DIRECT FARM BUSINESS GUIDE MICHAELA TARR STACY REVELS RUSTY W. RUMLEY 1 Alabama Direct Farm Business Guide Introduction .............................................................................................................................................................. 4 I. Using This Guide ........................................................................................................................................... 5 II. Overview of Administrative Agencies ...................................................................................................... 6 III. The Food and Drug Administration’s Food Code ..................................................................................... 8 IV. Alabama Department of Public Health .................................................................................................... 8 Section 1: Farming Operations ............................................................................................................................. 11 Chapter 1: Structuring the Business ...................................................................................................................... 12 I. Planning the Direct Farm Business ............................................................................................................. 12 II. Choosing a Business Entity .................................................................................................................... 14 III. Checklist ................................................................................................................................................. 21 Chapter 2 - Setting up the Direct Farm Business: .................................................................................................. 22 I. Siting ........................................................................................................................................................... 22 II. Registration and Permits ....................................................................................................................... 25 III. Insurance ............................................................................................................................................... 31 IV. Checklist ................................................................................................................................................. 33 Chapter 3: Managing and Marketing the Direct Farm Business ....................................................................... 37 I. Contracting ................................................................................................................................................. 37 II. Marketing .............................................................................................................................................. 46 III. Intellectual Property .............................................................................................................................. 50 IV. Weights and Measures .......................................................................................................................... 54 V. Looking to the Future: Estate Planning .................................................................................................. 54 VI. Checklist ................................................................................................................................................. 55 Chapter 4 - Taxation .............................................................................................................................................. 56 I. Registration Requirements ........................................................................................................................ 56 II. Taxation of Business Income ................................................................................................................. 57 III. Employment and Self Employment Taxes ............................................................................................. 61 IV. Sales and Services Taxes ........................................................................................................................ 66 V. Excise Taxes ........................................................................................................................................... 68 VI. Property Taxes ....................................................................................................................................... 69 VII. Checklist ................................................................................................................................................. 70 Chapter 5: Labor and Employment ........................................................................................................................ 71 I. Fair Labor Standards .................................................................................................................................. 71 II. Occupational Safety and Health ............................................................................................................ 75 III. Migrant and Seasonal Workers.............................................................................................................. 77 IV. Employer Liability .................................................................................................................................. 80 V. Checklist ................................................................................................................................................. 86 Section II – Regulation By Product ............................................................................................................................. 87 1 - Dairy ................................................................................................................................................................... 88 © 2013, All Rights Reserved 2 Alabama Direct Farm Business Guide I. Federal Regulation ..................................................................................................................................... 88 II. State Regulation ..................................................................................................................................... 92 III. Hormone Free Labeling.......................................................................................................................... 95 IV. Checklist ................................................................................................................................................. 96 2- Eggs ..................................................................................................................................................................... 97 I. Federal Oversight of Eggs ........................................................................................................................... 98 II. Alabama Regulation of Eggs ................................................................................................................ 100 III. Checklist ............................................................................................................................................... 102 3 - Fish, Shellfish and Other Aquatics .................................................................................................................. 103 I. Production ................................................................................................................................................ 103 II. Alabama Marketing ............................................................................................................................. 105 III. Federal Rules........................................................................................................................................ 105 IV. Checklist ............................................................................................................................................... 108 4- Fruits and Vegetables....................................................................................................................................... 109 I. Unprocessed Fruits and Vegetables ......................................................................................................... 109 II. Processed Fruits and Vegetables ......................................................................................................... 110 III. Checklist ............................................................................................................................................... 115 5 - Grains and Cereals........................................................................................................................................... 116 I. Grain Inspection Standards ...................................................................................................................... 116 II. Licensing of Warehouses ..................................................................................................................... 117 III. Selling Grains ....................................................................................................................................... 117 IV. Checklist ............................................................................................................................................... 119 7 - Honey & Maple