The singer will perform at the White House as he will receive the honour. He will appear next week, with the show being broadcast in the US over the summer.
The president and first lady are hosting the show in the East Room on June 2, reports The Telegraph.
In 2009, the prize -- awarded to musicians for a lifetime of songwriting -- went to Stevie Wonder.
Photographs: Chris Wattie and Dylan Martinez/Reuters
Pak should stop using terror as state policy: PM
Now, Paul McCartney, remixed
The book that Barack Obama enjoyed reading
Barack Obama awaits his Nobel prize money
Barack, Michelle Obama earned $5.5 million in 2009