If you are married with two kids and filling out a W-4, you no longer claim allowances at all. The redesigned form asks for dollar amounts instead. For two qualifying children under 17, you enter $4,400 in Step 3, and if your spouse also works, you handle that in Step 2. That is the short answer to how many allowances to claim when married with 2 kids under the current W-4.
Why Allowances No Longer Appear on the W-4
The allowance system ended with the 2020 redesign of Form W-4.1IRS. FAQs on the 2020 Form W-4 – Section: What happened to withholding allowances? The underlying statute at 26 U.S.C. § 3402 still uses the word, but the form itself now asks for the actual dollar value of credits and deductions you expect to claim.2Office of the Law Revision Counsel. 26 U.S.C. § 3402 Steps 2 through 4 are where a married worker with children does the real work of matching withholding to tax liability.
Step 3: The Dollar Amount for Two Children
Step 3 is where the Child Tax Credit lives on the form. Under 26 U.S.C. § 24, each qualifying child is worth a credit of $2,200 under current special rules.3Office of the Law Revision Counsel. 26 U.S.C. § 24 For two children, that is $4,400, and that is the number you write in the box on Step 3.
A child qualifies if they have not reached age 17 and meet the residency and relationship rules in 26 U.S.C. § 152(c).4Office of the Law Revision Counsel. 26 U.S.C. § 152 The per-child amount is set to adjust for inflation after 2025.3Office of the Law Revision Counsel. 26 U.S.C. § 24
For a married couple filing jointly, the credit begins to phase out once modified adjusted gross income passes $400,000.3Office of the Law Revision Counsel. 26 U.S.C. § 24 Above that line the credit is reduced by a set amount for every $1,000 of additional income rather than eliminated outright, so many families in the phase-out range still enter a reduced figure on Step 3.
Step 2: Handling Your Spouse’s Job
Married Filing Jointly combines both spouses’ incomes into a single set of tax brackets, which usually means a two-earner household needs more withholding than either job would produce on its own. Employers generally assume the person in front of them is the only earner, so Step 2 exists to correct for that.5IRS. FAQs on the 2020 Form W-4 – Section: Which option in Step 2 should I use to account for my multiple jobs?
If you and your spouse earn roughly the same amount, the simplest option is to check the box in Step 2(c) on both of your W-4s.6IRS. FAQs on the 2020 Form W-4 If the two paychecks differ significantly, especially when the higher salary is more than double the lower, use the Multiple Jobs Worksheet. It produces an additional dollar amount that goes on Step 4(c) of the higher-paying job’s W-4.
Other Lines That Change the Result
A few other entries on the same form matter for a family trying to land close to zero at tax time. Step 4(a) is for non-wage income you expect during the year, such as interest or dividends, so that tax can be pulled from your paycheck to cover it. Step 4(c) is for any extra flat dollar amount you want withheld each pay period, whether from the multiple jobs worksheet or simply because you expect a shortfall.6IRS. FAQs on the 2020 Form W-4 Before you fill any of it in, pull recent paystubs for both spouses and last year’s tax return so the numbers reflect your actual situation.
One boundary worth naming: claiming full exemption from withholding is a separate path with its own rules, and an exemption claim is valid only for the calendar year you file it. To keep it going, you have to file a new W-4 by February 15 of the next year, or the next business day if that date falls on a weekend or holiday. A married couple with two children and normal wage income is almost never in exemption territory.
Submitting the Form and When It Takes Effect
Give the completed W-4 to your employer’s payroll or HR department; many employers now accept it through an online portal.7IRS. About Form W-4 You do not send it to the IRS yourself, though the IRS can review it and, in some cases, tell your employer what settings to use.8IRS. Form W-4 Wage Withholding – Section: Reporting Form W-4 Information The current form is on the IRS website.
A first W-4 with a new employer takes effect for the first payroll period ending on or after the date you turn it in. A replacement W-4 must take effect no later than the first payroll period ending on or after the 30th day after you furnish it, though your employer can apply it sooner.2Office of the Law Revision Counsel. 26 U.S.C. § 3402 Check the next couple of paystubs to confirm the numbers moved the way you expected.