Legality of Buying and Selling Farm Animals

June 7, 2023

Hi, I'm Paige, half of the duo behind Fairway Stables™

This website is the one I've been searching for, for years; a compilation of knowledge on all things horsemanship, including practical advice on how to start an equestrian business.

No matter your experience level with horses or homesteading, I hope this is a place you can get lost in, and learn something along the way - we welcome everyone from vets, to lifelong ranchers, trainer, to nonprofits contributing.


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For many homesteaders and small-scale farmers, raising animals for food or fiber is a big source of personal resources or income. Others take their herd or flock a step further by breeding animals for sale, including livestock like goats or sheep and utility animals like working dog breeds.

If you plan to add selling animals to your homestead income sources – or you want to buy animals for your homestead – it’s important to understand the laws and regulations surrounding the sale and purchase of different species.

Defining Captive Animals

There’s a fine line for classifying domesticated species as “livestock” or “pets.” Generally, pets are animals kept for pleasure, while livestock includes animals that are raised for food.

That gets murky when we consider different cultures and lifestyles, however. Some cultures eat companion animals like dogs and cats, and others don’t eat beef. Vegans don’t consume any animal products, and vegetarians have specific preferences for what animal products they consume.

There are also animals that are raised and kept for work or income purposes. They’re not strictly pets for companionship, but they’re not food producers, either. Horses and working dog breeds fall in this category.


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According to the United States Department of Agriculture (USDA), a pet is “a privately owned companion animal that is not intended for research or resale.” This includes:

  • Dogs
  • Cats
  • Ferrets
  • Rabbits
  • Rodents
  • Hedgehogs
  • Reptiles
  • Amphibians

Birds are unique because they carry or transmit certain diseases and are regulated as poultry. These birds include:

  • Chickens
  • Doves
  • Ducks
  • Geese
  • Grouse
  • Guinea fowl
  • Partridges
  • Pea fowl
  • Pheasants
  • Pigeons
  • Quail
  • Swans
  • Turkeys


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“Livestock” generally includes domesticated species that are raised in an agricultural setting to provide labor or produce, such as meat, eggs, milk, leather, fur, or fiber. The USDA considers pork, veal, beef, and lamb as livestock, which includes all red meat. Poultry and fish are classified separately, as they are regulated by the Food and Drug Administration (FDA).

The USDA also classifies bees as livestock and takes responsibility for standards to govern the production of organic honey and honey-related products, such as pollen, propolis, royal jelly, beeswax, and bee venom. In addition, all 50 US states recognize beekeeping as an agricultural practice.

Exotic and Wild Animals

Exotic pets are legal in some states, both for keeping and for buying or selling, but the regulations can be strict. Often, “exotic” and “wild” are used interchangeably, but they are not synonymous.

The definition of a wild or exotic animal is an animal that does not belong to the list of domesticated species: dogs, cats, horses, cows, pigs, sheep, or goats.

There are animals commonly – and legally – kept as pets that don’t belong to this group, however. These are classified as non-traditional pets, not exotic pets, and include ferrets, hamsters, guinea pigs, tropical fish, parakeets, bearded dragons, gerbils, and hedgehogs. While not truly domesticated, these animals have been bred in captivity for many years in the pet trade.

A wild animal is an indigenous, non-domesticated species that lives freely in the wild. All states prohibit private owners from keeping a wild-caught native species, such as white-tailed deer, skunks, rattlesnakes, raccoons, and skunks.

Currently, 20 states have a comprehensive ban on wild cats, large non-domesticated carnivores, reptiles, and non-human primates. These animals are either outright banned or require licensure for educational or scientific purposes, not for private possession.

There’s a partial ban on exotic pets in 13 states, which bans specific animals by statute. These states may allow ownership of some species that are considered exotic. Another 14 states permit private ownership of exotic animals under licensure, but owners have to register with the state, obtain liability insurance, and provide satisfactory conditions.

The remaining three states don’t have direct controls over the private ownership of pets but may regulate ownership to some degree with health certificates or import permits.

Keeping exotic animals on a homestead is becoming more popular, such as yak, alpaca, and emu, but it’s important to understand the laws and regulations surrounding any exotic or non-traditional species.

Often, these animals have more challenging or unique care requirements and stricter laws and regulations for their purchase, sale, and ownership.

Buying Animals

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If you wish to buy animals for your homestead, whether for meat production or utility, the purchase is similar to any other purchase. Some farmers or breeders will offer animals for sale via online market, website, or local ad. You can learn a lot about the farmer or breeder and the animal’s background.

There are also livestock auctions, or for some animals, trade shows, but these are a riskier purchase decision. Many farmers and ranchers bring animals to these markets for a quick turnover. You don’t know much about their health, their breeding, the conditions they were raised in, or the diseases they may be carrying.

It’s not impossible to find a diamond in the rough, but it’s a riskier way to buy an animal.

Selling Animals

There’s a lot of red tape around selling meat or animal products, but less surrounding selling the farm animals themselves. A lot of homesteaders breed animals to sell, such as:

  • Worms for fishing or composting
  • Day-old chicks from egg-laying hens
  • Broiler chickens or meat ducks
  • Beef cattle
  • Heritage turkeys, ducks, or geese
  • Dairy cows or goats
  • Sheep or goats for fiber or meat
  • Farmed fish
  • Bees

Though there are some laws and regulations for some of these animals, selling a healthy livestock animal is generally simple and straightforward.

If you choose to breed animals for sale, however, it’s important to become knowledgeable on the breed, bloodlines, breeding best practices, and desired characteristics to produce the best possible animals. Don’t choose to breed the animals you have available – that leads to short-term gains at the expense of a poor reputation as a breeder in the long term.

Related: Biggest Mistakes Beginner Homesteaders Make

Related: Regenerative Farming

If you’re an experienced homesteader, it may be worth the additional effort to raise and train some animals prior to offering them for sale. For example, dairy cows and goats can be challenging for beginner homesteaders, so they may be willing to pay more for a well-behaved – and safer – animal.

About Breeding and Selling Companion Animals

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Companion animals include dogs and cats, but may also include horses, birds, or other animals that are kept as pets. These animals have the strongest level of protection on state and federal levels.

Some homesteaders breed working dogs or cats for use as pest control to earn extra income. This can be tricky, since there are stricter laws in place due to the boom of “backyard breeders” and puppy or kitten mills. There’s also a line between “hobby breeding,” which is a litter or two each year, and a commercial breeder who produces a lot of litters.

Each state has its own provisions covering commercial breeders and administrative oversight, such as the state department of agriculture, board of commercial breeders, or animal health department, and licensing requirements.

If you plan to breed companion animals on a large scale, it’s essential to check your local laws and obtain the proper licenses. Failure to follow these state laws or regulation could lead to fines, criminal penalties, and the revocation of the commercial breeder’s license.

Bill of Sale for Sellers and Buyers

While not required for all states, a bill of sale is an important legal document to officially transfer ownership of cattle, sheep, pigs, or other livestock. This is a formal agreement to sell the livestock in question, mitigating disputes on either the seller’s part or the buyer’s part.

Livestock bills of sale are often used when farm animals or sold in private sales or at auction to indicate that the animal is now owned by another party. These documents have details about the transaction, such as:

  • The key terms of the agreement
  • Details about the animal itself, including identifying markings, scars, tattoos, brands, etc.
  • The names of the parties
  • The date
  • The agreed-upon price
  • Signatures of both parties

Operating Your Homestead as a Business

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You can monetize your homestead without turning it into a full-fledged business, but there are legal steps you need to take to sell some of your products – including animals:

Tax and Insurance Requirements

Even a hobby farm has tax and insurance requirements. Whatever you’re selling needs to fall under your general liability homeowner’s policy. You can be exposed to liability for the products you sell, and a sole proprietorship doesn’t offer liability protection.

If the insurance company considers your hobby farm a “commercial enterprise,” however, it may not cover the liability that could occur from selling your products. Make sure you’re covered, whether you’re selling animals or other homestead products.

Also, if you’re making profit on anything you’re selling or accepting any form of compensation, including trading goods or services, you’re a sole proprietor in the eyes of the law. This is not a legal structure that offers protection, but it classifies you as making a profit according to the government.

If you want more liability protection, you should form an LLC. This offers a barrier of protection between your business liability and your personal liability. When you make money from your land, including selling live animals, it’s best to form an LLC for your own benefit.


If you’re selling anything on your hobby farm or homestead, whether produce or animal products, it requires an EIN number. This is basically a social security number for your monetized products. Anyone who sells goods or services for profit must have an EIN number – and it will matter at tax time. Just visit and fill out the form to apply for an EIN number.

Protect Yourself When Buying and Selling Animals

Whether you’re buying animals for your homestead or looking to sell your livestock to monetize your homestead, it’s important to ensure you’re legally protected. If you’re buying, a bill of sale is necessary to avoid any sales disputes. If you’re selling, have a legal structure in plan protects your business from a liability and tax perspective.

Frequently Asked Questions

Find out more information about buying and selling animals on your homestead.

Do I Need a Bill of Sales for a Livestock Sale?

The livestock bill of sale is an important document that’s necessary to guarantee the security of a livestock purchase or sale. It ensures both parties have a legally blinding record of the contract.

What Happens If I Don’t Have a Bill of Sale?

Selling animals without a livestock bill of sale can have consequences. Without this formal document, neither the buyer nor the seller has any recourse if the terms of the sale aren’t met.

There can also be liability issues. For example, say you sold a bull with identifying characteristics. The bull escapes the new owner’s property and causes a traffic accident. Without proof of the new owner, you could face liability for the damage the bull caused as its last legal owner.

Another issue is that you can’t report a change of ownership, which may lead to fines or problems with your tax return in your state.

What Is the Most Profitable Animal to Sell?

Several animals can be profitable, including cattle, chickens, goats, bees, and rabbits. There’s a lot of work involved in breeding and raising these animals, as well as risk of disease, injury, or death.

Related: How to Prepare for Winter on Your Homestead

How Do Farmers Sell Their Livestock?

Many homesteaders sell – or even trade – their livestock to other homesteaders or at local farmers’ markets, community supported agriculture (CSA), or farm shows. If you want to sell livestock on a larger scale, direct farm sales, wholesale markets, and auctions are good ways to get your product out into the market.

Do You Need a License to Sell Farm Animals?

Generally, selling livestock doesn’t require licensing or permits, but this can vary by state or the species. If you’re selling livestock on a larger scale, you may need a commercial license.

Can I Sell Meat from My Livestock?

You can sell livestock for processing, provided it’s the whole, living animal. Under the USDA Federal Meat Inspection Act (USDA-FSIS), this is a custom exemption. The purchaser is welcome to slaughter the animal themselves, once they own it, or deliver it to a custom exempt slaughterhouse for slaughter and processing.

The meat and byproducts of the animal are not legal to be sold. They can only be consumed by the members of the household and nonpaying guests or employees.

Related: Can You Sell Homegrown Produce and Eggs Legally?

Can Someone Slaughter Livestock I Have Sold Them on My Farm?

Once an animal is sold to a customer, it becomes their property. If you choose, you can allow them to slaughter the livestock on your property. You’re also within your right to require them to dispose of items like hide and offal.

Keep in mind that you are not permitted to assist with the slaughter on your property in any way. If you assist, your facility would be viewed as a custom exempt processing facility by the USDA, which means you’d be out of compliance.

What Is a Custom Processor?

A custom processor is exempted from some of the USDA-FSIS inspection regulations because the products are not eligible for resale and don’t pose a public health risk. Livestock owners pay custom processors to slaughter and process an animal into meat products.

Can I Sell Meat from My Livestock at a Farmers’ Market?

If you want to sell meat locally at a farmers’ market, the meat product must be slaughtered and prepared in a retail-ready manner under federal inspection in most states. You will also likely need a license to sell meat, and some individual markets have additional requirements.

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