Do short-term J-1 scholars, who receive the form 1099 from the institution they work for their services, need to fill out the form 8233 for the IRS if they are from a country with a tax treaty with the U.S.

Yes, you must file nonresident tax return and Form 8843. Your U.S. Tax Return: U.S. Tax Filing Requirements for Non-Residents

Thank you, I understand that. My question is about form 8233 http://www.irs.gov/pub/irs-pdf/i8233.pdf. Is it necessary to fill out & send to the IRS if the short-term scholar is not on payroll, which includes witholdings, and is instead receiving a 1099? Where & how does the scholar vouch for the tax treaty between the U.S. & their country? Thank you.

Form 8233 is submitted to the EMPLOYER to request exemption from withholding under a W-2 job.

However, the employer DOES have to file Form 1040NR-EZ to claim the treaty exemption, along with Form 8843 to validate their J-1 status, plus MAY have to file Form 8833 to explain the treaty exemption.