Hi, I am on L1 visa and my spouse is on L2 visa. We have been in the US since September 2007 and do not fulfill the substantial presence test. My spouse did not have any US earnings in 2007. My question is which tax return form will be most beneficial?
Should I file a joint return with my spouse as the dependent or file an individual return?
Thanks a lot for your help in advance.

You are non-residents and should file 1040NR. Non-residents generally cannot file a joint return.

You also have the option of waiting until you become residents in 2008 and then electing to start your residency earlier.

The simplest option is probably to file as non-residents. It's impossible to give an absolute "best option" answer without knowing the specifics of your situation.