NAICS Codes for Handmade Businesses: Schedule C Activity Codes (2026)

If you’re filling out a Schedule C for your handmade business, or registering for sales tax, picking the right NAICS code can feel like guesswork. The list runs to hundreds of pages, none of the categories quite say “I make soap on weekends,” and the wrong code can flag your return for the wrong industry comparison.

This guide walks you through the NAICS codes most handmade sellers actually use, with the 2026 codes the IRS expects to see on your Schedule C.

What is a NAICS code?

A NAICS code is a six-digit number that classifies your business by economic activity, used by the IRS, the Census Bureau, and state agencies to compare your business against others in the same industry.

NAICS stands for the North American Industry Classification System. The IRS uses your code to put your return in a bucket with similar businesses, so your reported revenue, expenses, and inventory levels get measured against what’s typical for your industry.

NAICS codes are reviewed every five years. The current edition is NAICS 2022, which is what the IRS uses on the 2025 tax year forms most people are filing in 2026. The next revision (NAICS 2027) is due to be published in late 2026 and will start appearing on tax forms from the 2027 tax year onwards. Worth knowing before you copy a code from a 2018 blog post.

Where the NAICS code goes on your Schedule C

On Schedule C (Form 1040), your NAICS code goes in Box B: Principal Business or Professional Activity Code, near the top of page 1. This is sometimes called your business activity code or PBA code; they’re all the same six-digit NAICS number.

A quick note on terminology: you’ll occasionally see references to a “five-digit business activity code.” That’s an older system that hasn’t been used on Schedule C for over a decade. Today, the IRS uses the full six-digit NAICS code on every Schedule C. If a tax form or state registration asks for a six-digit code, that’s your NAICS code.

Should I pick a manufacturing code or a retail code?

If you make your own products from raw materials, choose a manufacturing code (the 31–33 range), not a retail code. Manufacturing codes signal to the IRS that you carry inventory and have material costs to deduct as COGS.

This is the single biggest decision you’ll make on this form, and it’s the one most handmade sellers get wrong. They default to a retail code because they think of themselves as “selling on Etsy” rather than as a manufacturer.

Here’s the thing: as a maker, you take raw materials (beads, oils, fabric, clay, wood) and turn them into a finished product. That’s manufacturing, full stop. The IRS treats you as a manufacturer for tax purposes whether you produce 50 units a year or 50,000.

Why does it matter? Two reasons:

1. Inventory expectations. A retail code tells the IRS to expect inventory turnover from buying finished goods and reselling them. If your return shows large material purchases instead, that mismatch can flag your return.
2. COGS deductions. Manufacturing codes support claiming raw materials and direct production costs as COGS, the deduction that makes the biggest difference to most makers’ tax bill.

If you also do some buy-and-resell on the side (say, you make jewelry but also resell vintage findings as-is), pick the code that matches the larger part of your revenue. The IRS asks for your principal business activity, not every activity.

One thing to avoid: code 999999 (“Unclassified Establishments”). This signals to the IRS that you couldn’t decide what industry you’re in, which is the kind of attention you don’t want on a small-business return.

Quick reference: NAICS codes for handmade businesses (2026)

The rest of this guide breaks each of these down with the alternatives and edge cases.

NAICS codes for jewelry makers

The right NAICS code for most jewelry makers is 339910 (Jewelry and Silverware Manufacturing), used if you make the pieces yourself from beads, wire, metals, or stones.

There are a couple of jewelry-specific codes to be aware of:

339910: Jewelry and Silverware Manufacturing The default for jewelry manufacturers. Use this if you cut, set, solder, string, or otherwise make jewelry yourself. Covers fine jewelry, costume jewelry, beadwork, wire-wrapped pieces, and resin jewelry.

423940: Jewelry, Watch, Precious Stone, and Precious Metal Merchant Wholesalers For sellers who primarily wholesale jewelry to other retailers, for example supplying gift shops, boutiques, or trade-show buyers rather than selling direct to the end customer.

448310: Jewelry Stores (now classified under 459310 in NAICS 2022 revisions for some sub-categories) A retail-only code, suitable if you don’t actually make the jewelry yourself; say, you buy finished pieces and resell them at art shows or by appointment. If you make the jewelry, skip this and use 339910 instead.

NAICS codes for soap makers

The default NAICS code for handmade soap is 325611 (Soap and Other Detergent Manufacturing), used by most cold-process, melt-and-pour, and hot-process soapmakers.

If your product range is broader than just bar soap, there’s a second code worth considering:

325611: Soap and Other Detergent Manufacturing For soap manufacturing businesses that primarily make bar soap (cold-process, hot-process, melt-and-pour) and detergents.

325620: Toilet Preparation Manufacturing A better fit if you also produce lotions, body butters, scrubs, bath salts, lip balms, and similar bath-and-body products. If most of your revenue comes from non-soap items, use this code instead.

If you make both, pick the one that represents the bigger share of your sales. The IRS only wants your principal activity.

A note for MoCRA-affected makers: your NAICS code is independent of your MoCRA registration. They’re different government systems. You can be classed as 325620 for tax purposes and still register your facility under FDA cosmetic rules.

NAICS code for candle making

The recommended NAICS code for candle making is 339999 (All Other Miscellaneous Manufacturing), the default the NAICS classification system suggests for candle products.

Candlemakers don’t have their own dedicated code, so you’ll need to pick the closest match:

339999: All Other Miscellaneous Manufacturing The default code returned by the official NAICS search for “candles, manufacturing.” Covers soy, paraffin, beeswax, container, and pillar candles, basically any candle product.

424990: Other Miscellaneous Nondurable Goods Merchant Wholesalers Use this only if you wholesale candles you’ve bought from someone else. If you make the candles, stick with 339999.

453998: All Other Miscellaneous Store Retailers(legacy code, replaced in NAICS 2022) Some older guides recommend this. It’s been retired in NAICS 2022, and it was a retail code anyway, which doesn’t fit candle manufacturers. Use 339999.

NAICS codes for clothing and fabric makers

Most apparel makers fall under the 315 (Apparel Manufacturing) subsector. The exact six-digit code depends on what you make:

If you sew small batches of original clothing (dresses, t-shirts, custom-fit garments), 315280 is usually the right pick. We have a more detailed breakdown for sewing and clothing businesses here.

NAICS code for potters and ceramicists

The right NAICS code for potters and ceramic artists is 327110 (Pottery, Ceramics, and Plumbing Fixture Manufacturing), used for any business making products from clay or ceramic.

This code was simplified in NAICS 2022. If you’ve used older codes in the past, here’s what changed:

• 327110: current code (NAICS 2022 onwards). Use this on your 2025 and 2026 returns.
• 327112: Vitreous China, Fine Earthenware (retired)
• 327113: Porcelain Electrical Supply Manufacturing (retired, wasn’t relevant to handmade pottery anyway)

If your accountant or tax software still suggests one of the retired codes, push back. The IRS now uses 327110 for handmade pottery, ceramic mugs, sculptures, planters, and dinnerware.

NAICS codes for woodworkers

For woodworkers, 321999 (All Other Miscellaneous Wood Product Manufacturing) is usually the best fit. It covers handcrafted wood items that don’t fall neatly into furniture or veneer categories.

The 321 series has several sub-codes worth knowing:

Most one-person woodworking shops making cutting boards, charcuterie boards, signs, or decorative pieces will use 321999. If you mainly build furniture, 337122 is the better fit.

A note: the older code “33243” sometimes recommended in tax forums is incomplete (it’s only four digits) and refers to Sawmill, Woodworking, and Paper Machinery Manufacturing; that’s the code for building the machines, not for being a woodworker. Don’t use it.

NAICS code for yarn spinners and thread makers

If you spin or produce yarn and thread for sale, the NAICS code is 313110 (Fiber, Yarn, and Thread Mills), the manufacturing code for raw yarn and thread products.

Use this only if you make yarn or thread for sale (handspun, dyed-to-order yarn, novelty thread). If you use yarn to knit or crochet finished items, that’s a different code: typically 315190 (Other Apparel Knitting Mills) for garments or 339999 for things like amigurumi or knitted decor.

(Some older guides list code “13110” for yarn. That’s a typo. The correct six-digit code is 313110.)

NAICS code for bakers

The NAICS code for retail bakers is 311811 (Retail Bakeries), which covers home bakeries, custom cake businesses, and small commercial bakeries selling direct to consumers.

If you bake from a home kitchen under your state’s cottage food laws and sell at farmers markets, online, or by direct order, 311811 is the right code. The “retail” in the name is misleading: it’s actually a manufacturing-class code that captures both production and direct-to-consumer sales.

Other relevant codes:

• 311812: Commercial Bakeries (use this if you supply other businesses wholesale, not direct to consumers)
• 311991: Perishable Prepared Food Manufacturing (for jam, pickles, sauces, ready-to-eat meals)

We’ve covered the bakery NAICS code in more detail here with cottage-food-law specifics.

NAICS codes for leatherworkers

For leather goods makers, the right NAICS code depends on what you make:

316992: Women’s Handbag and Purse Manufacturing For makers focused on handbags, purses, totes, and similar leather goods.

316998: All Other Leather Good and Allied Product Manufacturing The catch-all for leather goods: wallets, billfolds, key cases, belts, watch straps, dog collars, harnesses, leashes, journals, and saddlery.

316110: Leather and Hide Tanning and Finishing Only relevant if you actually tan and finish hides yourself. Most leatherworkers buy pre-finished leather and don’t need this code.

If you make a mix of bags and small leather goods, pick the one that’s the bigger share of revenue.

NAICS code for cannabis and CBD makers

For cannabis and CBD product manufacturers, the NAICS code is usually 325411 (Medicinal and Botanical Manufacturing), which covers tinctures, oils, salves, and botanical-based products.

The IRS has been more attentive to cannabis and CBD businesses in recent years. Choosing the right code matters here, especially under IRC §280E which limits ordinary deductions for businesses trafficking in Schedule I substances (federally, this still includes most cannabis products even where state-legal).

Common codes:

• 325411: Medicinal and Botanical Manufacturing. Tinctures, salves, oils, dried botanicals.
• 311812: Commercial Bakeries. CBD-infused baked goods sold wholesale.
• 311991: Perishable Prepared Food Manufacturing. CBD chocolates, gummies, infused foods.
• 424590: Other Farm Product Raw Material Merchant Wholesalers. Wholesale of cannabis raw material (where state-legal).

If you’re in this space, talk to a tax pro who specialises in cannabis: the codes are the easy part.

For a deeper dive on the operations side, see our guide on cannabis manufacturing software.

NAICS code for cosmetics makers

For makers of cosmetics, makeup, lip products, and skincare, the NAICS code is 325620 (Toilet Preparation Manufacturing), the manufacturing code for personal care, cosmetic, and grooming products.

This is the same code soap makers use if their product range extends beyond bar soap. It covers:

• Lip balms, lipsticks, lip glosses
• Lotions, body butters, body scrubs
• Hair products (shampoo, conditioner, hair oil)
• Skincare (toners, serums, face creams)
• Makeup (foundations, eye products)
• Bath bombs, bath salts, bath fizzies
• Perfumes and fragrances

If you’re a small cosmetic maker, MoCRA compliance is worth being aware of separately. It’s a registration requirement, not a tax code, but the two often come up at the same time.

What about a “retail-only” or online-seller NAICS code?

If you don’t make anything yourself and only resell finished products you’ve bought, you’ll use a retail code. The most common ones for handmade-adjacent online sellers:

459110: Sporting Goods, Hobby, and Musical Instrument Retailers The current NAICS 2022 replacement for the old 451130 (Sewing, Needlework, and Piece Goods Stores) and similar craft-supply retail codes.

459510: Used Merchandise Retailers For vintage resellers, antiques dealers.

459999: All Other Miscellaneous Retailers The catch-all. Use only when nothing else fits.

⚠️ Heads up: Old guides recommend codes like 454111 (Electronic Shopping) and 454390 (Other Direct Selling) for online sellers. Both were retired in NAICS 2022. Don’t copy them from older blog posts. For online retail of crafts and gifts, 459110 or 459999 are the current equivalents.

What if my craft isn’t on this list?

If your craft doesn’t fit cleanly into any of the codes above, the safest fallbacks are:

1. 339999 (All Other Miscellaneous Manufacturing). This is the default code for handmade products that don’t fit a more specific category. It covers candles, costume jewelry novelties, ornaments, and any other “I make stuff” business that doesn’t have a dedicated code.

2. Search the official NAICS lookup. The NAICS Association search lets you type in a keyword and see matching codes with descriptions.

3. Check what similar businesses use. A quick Google for “NAICS code [your craft]” will often surface the consensus pick. Just verify it’s a current 2022 code, not a retired one.

4. Ask a CPA who works with makers. This is a 30-second question for a tax pro, and they often have niche knowledge (especially around food, cannabis, and cosmetics where the code can affect compliance).

Whatever you do, avoid 999999. It’s a flag for “I couldn’t decide” and isn’t worth the audit risk.

What happens if I picked the wrong NAICS code last year?

You can change your NAICS code on next year’s Schedule C. The IRS doesn’t require you to amend a prior return just to change the activity code.

The IRS treats the NAICS code on your Schedule C as a description of your current activity, not a permanent designation. If you started filing as a retailer (454111) and now realise you should have been filing as a manufacturer (325611), simply use the correct code on this year’s return.

A few notes:

• State filings and EIN. If you applied for an EIN or registered with your state under one NAICS code, you may want to update those records too. The IRS Schedule C is independent.
• Shifts in your business. It’s normal for your code to change as your business evolves (e.g. you start as a candle retailer reselling, then begin making your own candles a year later). Just update it the next time you file.
• Material code changes. If you’re switching from a retail code to a manufacturing code, your COGS and inventory numbers will probably also change shape. Make sure the rest of your Schedule C is consistent with the new classification.

A quick reality check on tax advice

This guide covers the codes most handmade sellers use, but it’s not a substitute for advice on your specific situation. NAICS code selection can interact with state licensing, sales tax registrations, and (in some states) industry-specific compliance like food handling permits or cosmetic registration.

If your business is generating meaningful revenue (say, more than $20,000 a year) it’s worth a 30-minute conversation with a CPA who works with makers. They’ll often catch deductions you’ve missed, flag classification issues, and save you their fee in the first year.

For the basics (the actual line-by-line of filling out Schedule C) our Schedule C guide for makers walks through every box on the form.

Frequently Asked Questions

Once you’ve chosen the right NAICS code and filed your Schedule C, keeping accurate inventory and COGS records is what separates a stress-free tax year from a last-minute scramble. Craftybase tracks your raw materials, finished products, and manufacturing costs automatically, so the numbers in Box B’s column (and everywhere else on Schedule C) are already waiting when tax time comes. Start your free 14-day trial to see how it works.