Our first baby (dependent) is due in 2015 so I wanted to make sure to adjust my withholdings at work appropriately now so that I don't need to owe any money. I'm married and we're both employed but my husband and I file separately right now (for 2014) but plan to file jointly next year so that we can get the child care break (which I read you can only get if you file jointly). Is this the best thing to do to ensure that we get the most money back and what should I claim for my withholdings 1, 2, 3. Thank you for your advice!
Re: W4/tax question. Any tax professionals out there. What should I file?
Is there a reason you and DH are filing separately? Filing separately in general is a bad idea. It results in owing the most taxes. You have plenty of time to file as married filing jointly for 2014.
Technically, you can claim 3 exemptions on your W4 but depending on your individual situation, you could end up owing money. My personal (not professional) advice is to put 0 or 1 so that the most taxes are withheld. I'm sure you can find calculators to help you estimate how much should be withheld if you want to try to figure it out how much tax you'll owe in 2015.
It'll probably take you a couple of years to figure out how to adjust your W4 in order to balance things out.
FWIW, I also follow the idea that you should aim to get a little refund back and have more each paycheck. We try to keep it to $1000-$2000 to have a little cushion since our salaries generally go up each year.