Yes, you can have your wife on payroll in the LLC.
You cannot just decide to issue her a W2 at year end.
She would have to have been on payroll and the LLC would have been paying payroll taxes during the year.
You are also correct, the owner of the LLC does not receive payroll or a W2.
The LLC is either reporting as a multimember LLC on Form 1065 or on Schedule C on your individual income tax return.
