If you file a tax return for any reason, you are required to report all your income, no matter how minor some items might be. If you pay her to work, regardless of where or how much, she is required to report it on her tax return. How much tax she would have to pay depends on all her other tax factors.
If she works in your home and you pay her more than $2700, you are required to issue her a W-2. You are not required to withhold or pay household employee tax when the employee is your parent (in most cases, but there is a rare exception). Even if you pay less than $2700 and don't issue a W-2, she is required to report the income, although it would be on the honor system if there is no report to the IRS that they can look over.
