Yes, you can file a 1099 form for your spouse. However, you will need to verify if your spouse qualifies as a contractor or an employee.
To determine if your wife would be considered a contractor or an employee you would need to address the following common law rules:
- Behavioral: Do you control or have the right to control what your wife does and how she does her job?
- Financial: Are the business aspects of her job controlled by you?
- Type of Relationship: Are there written contracts or employee-type benefits (i.e. pension plan, insurance, vacation pay, etc.)? Will she be considered doing long-term work for the business?
If your spouse is your employee, Social Security, and Medicare taxes must be paid for her by your business. If you haven't paid any quarterly tax payments or filed the quarterly returns you could be fined or penalized for not prepaying and filing the employee federal returns.
If your spouse qualifies as a contractor, she is self-employed. She would need to file a schedule C with your joint return and her Medicare and Social Security tax will be calculated with her Self-Employment Tax.
Both a contractor and a W-2 worker would help with your wife's social security benefits.
Please see the following links for filing a 1099 form for your spouse:
Filing a 1099 form for a spouse
Independent Contractor Vs. Employee
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