We have the Family Owned Business Institute that has a program called the Research Scholar.  People prepare a proposal that underwent a blind review process.  The winners of the program are awarded a $5,000 "stipend" that is paid out now for the participant to convert the research into a publishable, refereed article with appropriate references to the Family Owned Business Institute.  In addition, they are expected to disseminate the results of the research to members of the business community, students and other constituencies as appropriate through meetings, seminars, publications and the classroom.  Also, the finished paper needs to be turned in for consideration as a prensentation at the 2012 Family Enterprise Research Conference.

Could we consider this as a fellowship type payment or is it more of a prize and treated as a 1099 reportable payment?

Does the decision change if both employees and non employees were awarded stipends?