Her passport remains valid as that is issued by her home country; but the U.S. visitor visa is automatically invalid by operation of law (although facially valid) due to her I-94 overstay.
After you are married, as a USC, can petition for her as a immediate relative. You file the I-130 and I-864 affidavit of support and she will concurrently file the I-485 (application for permanent residence) and the I-765, employment authorization. There are other forms to be included, G-325 for both of you, etc.
Your filing will be under INA section 245(a) which will forgive her overstay and unauthorized employment. There is no monetary penalty to be paid. If you are married less than 2 years at the time of interview, she will be granted conditional permanent residence, Google it.
I agree with the other posters, consult with and hire an experienced attorney, but the case is relatively straightforward as long as she entered on her own visa, has no significant criminal record and never made a false claim to citizenship. I hope this was responsive to your inquiry, congratulations and good luck.
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