Your wife is considered a independent contractor and therefore self-employed. She will have to pay regular income tax and self-employment tax on that income. Please see Am I an employee or an independent contractor? for additional information.
You will have to go through the questions carefully and she might be able to claim expenses she had. Please see What self-employed expenses can I deduct?
If you are not comfortable going through this section by yourself then you might want to consider our TurboTax Live Service.
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