Are members taxed on interest that the CareGuard account earns?

CareGuard establishes a bank account for the member that earns interest. Just like with any other bank account, the federal government taxes interest earned. The member will receive a 1099-INT if the account earns more than $10.00 in interest. Standard withholding is done on the account so that typically the tax on the interest has already been accounted for and the member just needs to include the form on their tax return. For members with a Medicare Set Aside, according to Medicare’s guidelines, the funds in the MSA account can be used to pay for taxes on the interest earned by the account.