Honesty is the best policy inKristen BellandDax Shepard‘s household — even if it makes parenting a little awkward sometimes.

“We don’t do any white lying, for better or worse. If they want the truth, they get the truth,” Shepard, 44, tells PEOPLE exclusively in its latest cover story about raising his daughtersDelta, 4, andLincoln, 6 this month, with Bell.

Acknowledging that some parents may findthe lack of Santa in their household“very triggering,” Shepard explains that it was Lincoln who first brought up that Father Christmas is a farce.

Jeff Lipsky

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“Here’s the thing: Our oldest daughter wasnotbuying it,” he explains. “We were fine with the one lie, like ‘Yeah, he’s Santa. He comes from here.’ Then it was like, ‘Well, how’s he do this?’ We’re like, ‘Okay, so his sleigh is magic … ‘ All of a sudden you’re 36 lies deep.”

“I’m seeing thebest part of her brain at work, which is calling bulls— on things that can’t happen,” he continues. “I’m just squashing it with these new and more inventive lies and then finally I was just like, ‘You know what? You’re right. You smell a skunk and there’s one here.’ ”

Kristen Bell and her daughters.Dax Shepard/Instagram

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Dax Shepard and Kristen Bell.Jeff Lipsky

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While Santa doesn’t exist in their house (though the couple say their younger daughter “still believes” in him despite what they’ve told her), theentertainers teach their kidsto keep such revelations to themselves.

“We definitely threaten a lot: ‘You cannot, cannot, cannot under any circumstance tell another kid what we told you! You now have a secret and it is your job, and you won’t get other secrets if you don’t keep this one,’ ” says Bell, 38, of how they guide their daughters. “There are beautiful ways to explain it to them [that] keeps the magic alive.”

Admitting their firstborn was a breeze (“She was a very misleading first child. She potty-trained herself!” says Shepard), the spouses saytheir younger daughter has hada much trickier personality.

“The first timewe had the sex conversation, she said, ‘Where do babies come from?’ And we said, ‘Well, Daddy has a penis and Mommy has a vagina,’ ” Bell recalls of their conversation with Delta. “We got two sentences in and she went, ‘I’m going outside.’ And just didn’t care.”

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And though they’re one of the mostbeloved power couples in Hollywood, the stars say their daughters have no interest in their careers. “I had all these fears about that, and what has quickly occurred to us is that they could not care less,” says Shepard. “They’re unimpressed and they just assume everyone’s parents do that too.”

Jokes Shepard, “Nobody’s allowed to sing in the house but them, and they have the worst voices of the four of us!”

source: people.com