Why are people taller in the morning?
Because over the course of the night when we sleep we replenish all of the bone/blood/water/muscle the sun evaporates from us during the day
Cuz gravity hasn't taken it toll yet.
Is that even possible?
because you're dreaming bro
While we are sleeping we are not being vertically affected by gravity (unless you stand up while you sleep), your spine is not being pushed by the force of the Earth.
It seems that way...
It's because the chemical that makes us grow is only produced in the body while sleeping
International Space Station astronauts came back to earth after 6 months were shorter due to no gravity on earth. It's very likely a very small difference is missing after laying down for some time, but I don't think it's noticable.