Yes, the tax credits for your children should only be claimed once between the two of you. If your husband’s W-4 already reflects both children (Step 3), you should not claim them on yours. Usually, the higher-earning spouse should claim the dependents in Step 3 to maximize the immediate tax benefit, while the other spouse leaves Step 3 at $0.
- Unpaid FMLA: If his leave is completely unpaid, your household income will be significantly lower this year. In this specific case, you could move the dependents to your W-4 to increase your take-home pay, provided he updates his W-4 to $0.
- Paid FMLA / Short-Term Disability: If he is receiving a paycheck or disability benefits, those are usually still taxable. It is safest to leave the dependents on one person's form (his or yours).
Also make sure you both have the "Multiple Jobs or Spouse Works" box checked in Step 2(c).
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