In general, amounts granted to an individual solely out of the payor’s “detached and disinterested generosity” are treated as “gifts” that are excluded from tax under section 102 of the Internal Revenue Code. The IRS has confirmed that a payment made by a charity to an individual that responds to the individual's needs (in order words, is motivated by charitable intent rather than any moral or legal duty) qualifies for this exclusion, and consequently is not subject to Form 1099 reporting. See Revenue Ruling 2003-12.
As further explained by the IRS in Publication 3833, some grants to individuals will not meet the requirement of being motivated by charitable intent, such as where the charity receives services or some other economic benefit in return for the payment.
only the charity can tell you why it requested a w-9
