Do teams have to pay taxes on the grant money? I'm asking because I know prize money from things like hackathons are taxed.

$12k can last 2 months full-time for a team of 2 ($3k/mo/founder). But if there are taxes, taking home only 65% of $12k ($8k, or $2k/mo/founder) would probably not be enough, at least not in or around major cities.