Student Loan payments made by employers are subject to employment taxes so you will need to complete Form 8919 in TurboTax.
Enter "Form 8919" in the Search bar and choose the Jump to Link.
Continue through the screens until you get to the one that says "Enter Source of Other Earned Income" and has a checkbox (which you will select) that says "Employee Compensation that was not reported on W-2"
Continue through the interview for Form 8919 as it relates to the 1099 you received.
As an aside to this, if your wife is still a student you may qualify for one of the tuition deductions or credits since you are paying taxes on the funds recieved from her employer. Here is some additional information regarding these credits and deductions: Education Credits Available Tuition and Fees Deduction
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