Since she's caring for your child in your home, she's generally considered a household employee, not an independent contractor. That means the correct way to pay her is as an employee, not with a 1099.
Here's what that means:
- Get an EIN (Employer Identification Number) from the IRS
- Have her complete a Form W-4
- If you pay her $3000 or more in 2026, you must:
- Withold and pay Social Security and Medicare taxes
- Provide her a W-2 at year end
- File Schedule H with your tax return
If you pay her below the annual threshold, you generally don't owe the Social Security and Medicare Taxes, but you should still keep records of your payments, especially if you want to claim the Child and Dependent Care Credit.
If you want to learn more about the Household Employment rules, see this link.