Which of the following statements regarding California unemployment benefits is false?

The statement that unemployment compensation is included in taxable income is actually true, making the assertion that it is false incorrect. Unemployment benefits are generally considered a form of income and must be reported as such by recipients on their tax returns. This is important for beneficiaries to understand because failing to report such income can lead to complications with the IRS.

The correct answer among the statements listed is that the Employment Development Department providing a 1099-MISC form is false. Typically, EDD issues a 1099-G form to individuals who receive unemployment benefits, which reports the total amount paid in benefits and any federal income tax withheld. The use of a 1099-MISC form is more common for reporting other types of income, such as self-employment income or certain types of payments made to independent contractors. Understanding the correct forms and reporting requirements is essential for beneficiaries to ensure compliance with tax laws.