The FDA small business nutrition labeling exemption: how it works and how to file

Still working out whether you need a panel at all? Start with the decision path by business type. This page assumes you already know you want the exemption.

The three exemptions, and which ones need paperwork

Founders lump these together. They are three separate provisions with three different burdens.

All three carry the same poison pill, covered near the bottom of this page: any nutrient content claim, health claim, or other nutrition information kills the exemption for that product.

The retailer exemption at 101.9(j)(1) is the one most cottage operators actually sit inside, and it is the least work. Sell your own food direct to consumers under either threshold and you file nothing. No form, no notice, no expiration date. You just have to keep making no claims.

How FDA counts your employees

FDA does not count heads, and this is where founders miscalculate. FDA's Small Business Nutrition Labeling Exemption Guide defines a full-time equivalent employee as the "[t]otal number of hours of salary or wages paid to the employees of the firm and its affiliates divided by 2080 hours."

Two things in that sentence do the work.

"Hours of salary or wages paid." Everyone on payroll counts: owners, officers, secretarial staff, production, distribution. Part-timers count for actual hours, not as whole people.

"And its affiliates." FDA's guide says a firm "includes all domestic and international affiliates," and treats two firms as affiliates when one has the power to control the other, when a third party controls or can control both, or when an identity of interest exists. If you and your partner also own a co-packing company, its payroll hours land in your total.

Worked example

Say you make hot sauce. Last year's payroll:

6,020 ÷ 2,080 = 2.89 full-time equivalent employees. Under 100, and under 10, so on the employee test alone you are inside the micro carve-out.

Now change one fact. You and your partner also own the co-packing shop that runs your fills, and it paid out 180,000 hours last year. That is an affiliate. 6,020 + 180,000 = 186,020, divided by 2,080 = 89.4 FTE. Still under 100, so you keep the low-volume exemption. But you are nowhere near the 10-FTE carve-out anymore, so you have to file the annual notice you thought you could skip.

The e-filing system wants one number. If your headcount is comfortably under 100 and you have no affiliates, headcount is fine. Otherwise do the division and keep the payroll math on file.

What counts as a "unit," and what counts as a "product"

A unit is "a package, or if unpackaged, the form in which the product is offered for sale to consumers." A 5 oz bottle is one unit. So is a 10 oz bottle. So is a single unwrapped cookie sold from a bin.

A product is a food or dietary supplement in any size package, made by a single manufacturer or bearing the same brand name, with the same statement of identity and similar preparation methods. That definition matters more, because it tells you what to add together.

Back to the hot sauce. Last year you sold 62,000 five-ounce bottles of Ghost Pepper Hot Sauce, 31,000 ten-ounce bottles of the same sauce, and 900 one-gallon foodservice jugs of it. Same brand, same statement of identity, same recipe. That is one product at 93,900 units, not three products at 62,000 / 31,000 / 900. You are under 100,000 by about 6%, and a good spring will push you over.

Your Roasted Garlic Hot Sauce is a different statement of identity, so it is a separate product with its own 100,000-unit count. The unit threshold is per product. The employee threshold is per firm.

Dietary supplements: the parallel exemption

Supplements get the same deal by cross-reference. 21 CFR 101.36(h)(2) applies "[s]ection 101.9(j)(18) for foods that are low-volume products" to dietary supplements, and reaches only products "whose labels, labeling, and advertising do not provide nutrition information or make a nutrient content or health claim."

It also spells out a timing requirement the marketing pages gloss over: the notice must be "filed before the beginning of the time period for which the exemption is claimed." File before the window opens, not partway through it.

In practice almost no supplement qualifies. "Supports immune function" is a claim. A Supplement Facts panel is nutrition information.

The annual filing: FDA Form 3570

The notice is FDA Form 3570, OMB control number 0910-0381. One page. It asks for:

• Firm name and address, phone, fax, email
• Type of firm: manufacturer, packer/repacker, retailer, distributor, or importer
• The twelve-month period you are claiming
• Average number of full-time equivalent employees
• Each product by the name on its label, and units sold for each
• Name and address of the manufacturer, distributor, or importer
• Contact person, signature, printed name, title, date

That is the whole thing, and there is no fee. Nothing on the form or in the e-filing system asks for payment.

The signature carries one live obligation: you commit to notifying FDA when your average FTE count or units sold exceed the numbers you claimed. More on that below.

One caution on the model form PDF. It is dated 1/11 and shows an expired OMB date. It is still the form FDA links from its own exemption page, and the e-filing system collects the same fields, so use it. The stale date does not mean the requirement went away.

Filing, step by step

FDA takes the notice electronically or on paper. Electronic is faster and gives you a receipt.

1. Pick your twelve-month period. You choose it. FDA's guide says the period "must be current with the date that you are submitting your notice," and 101.36(h)(2) requires filing before the period begins. Clean answer: file a few days before the window you want, and make the window your fiscal or calendar year so there is no odd date to remember.
2. Count units for the previous 12 months per product, summing every package size sharing the brand name and statement of identity. For an unlaunched product, estimate.
3. Do the FTE division. Total paid hours across the firm and its affiliates, divided by 2,080.
4. Create an account in FDA's Nutrition Labeling Exemption e-filing system, reached from FDA's small business exemption page. An activation email arrives before you can log in.
5. Search for your firm in FDA's database. Select it if it is there, enter it manually if not.
6. Enter firm information: physical address, firm type, mailing address if different, contact details.
7. Enter exemption information: FTE count and the exemption start date. That field defaults to today's date, so change it if your period starts later.
8. Add each product: the name as it appears on the label (up to 115 characters), the manufacturing firm, and units sold in the previous 12 months.
9. Review the confirmation screen, fix anything wrong, and submit.
10. Print the receipt. The confirmation screen has a "View receipt" link. It is your only proof, so save the PDF somewhere you will find it in eleven months.

Paper filing goes to the address in FDA's exemption guide: Center for Food Safety and Applied Nutrition, Food and Drug Administration, HFS-820, 5001 Campus Drive, College Park, MD 20740-3835, or fax 301-436-2639. FDA has reorganized its foods program since that mail code was assigned, so confirm the address the day you send it.

Renewing. Log back in and the system lists your active and expired exemptions. A Renew button appears next to any exemption expiring within the next month or recently expired. Renewal reuses last year's data, so you update the employee count and unit numbers instead of retyping everything.

Nobody is going to remind you. Probably.

Here FDA disagrees with itself, and you should know it before building a process around either answer.

The Small Business Nutrition Labeling Exemption Guide says, in capital letters: "FDA DOES NOT NOTIFY FIRMS WHEN IT IS TIME TO FILE A NOTICE. FDA DOES NOT SEND CONFIRMATION THAT THE AGENCY HAS RECEIVED YOUR COMPLETED NOTICE."

FDA's exemption landing page says: "In addition, firms eligible for the exemption will receive an electronic reminder when it is time to resubmit their nutrition labeling small business exemption notice."

Both are FDA's own words on FDA's own site, and they cannot both be a safe basis for planning. Treat the guide as controlling — it is the more conservative of the two, and an email that never arrives is indistinguishable from one that went to spam. Set a calendar reminder eleven months out, keep the receipt, treat any FDA reminder as a bonus.

The consequence of missing it is quiet. If FDA does not receive a completed notice each year, the exemption stops applying. Nothing on your package changes. Nothing arrives in the mail. Your product is simply misbranded from that day forward, and you find out when a buyer, a marketplace, or an inspector asks.

What voids the FDA small business nutrition labeling exemption

The exemption does not apply to a product if any nutrient content claim (FDA's example: "sugar free"), health claim, or other nutrition information appears on the label, in labeling, or in advertising. Advertising is the word that catches people: Amazon bullets, a Shopify description, an Instagram caption reading "12g of protein per bar," a sell sheet emailed to a distributor.

Note that third category. You do not have to characterize a level — "100 calories per serving" is enough on its own. Deleting the word "high" does not always save you. The full list of trigger phrases is in what counts as a nutrient content claim. Make it a written rule for whoever runs your marketing, because packaging gets printed once and ad copy gets rewritten every week by whoever has the login.

What happens if you outgrow it mid-year

You signed a commitment to tell FDA when you cross a threshold, so the first step is notification, not labeling: report that your average FTE count or unit volume has exceeded the numbers you claimed.

Then the label. Neither FDA's guide nor the regulation gives you a stated grace period to sell through inventory, so plan on the exemption ending when the threshold is crossed, not at the end of your claimed period.

Which means build the panel before you need it. The 100,000-unit line is the one small brands cross, and they cross it during a good quarter, which is exactly when you cannot absorb a four-week lab turnaround or a packaging reprint. If your last notice reported 90,000 units, treat the panel as due now.

If you need the panel itself, Nutrillius builds a 21 CFR 101.9-compliant one from your recipe in about a minute. $39 one time, no subscription, PNG/PDF/SVG, 90 days of edits. Medallion Labs' published price for the same output is $1,609 to $1,724 per sample, and rush doubles it. A print-ready panel sitting in a folder is a cheap hedge against a good sales month.