Ground Picture/Shutterstock The tax system operates on a “pay-as-you-go” basis. If your taxes aren’t being withheld from your income, the IRS expects you to pay estimated taxes four times a year, usually in January, April, June, and September. If you work full-time for an employer, your company typically withholds federal taxes from your paycheck. But if you’re self-employed — or if you have a side gig on top of a day job, get a big alimony check, or win a prize — you probably need to make estimated tax payments to avoid both penalties for underpayment and a big bill when your taxes are due. Here’s what you need to know. Who should make estimated payments? The most common category of people who must pay estimated taxes are the self-employed. But many other people should make estimated payments, too, including: Retirees who take required distributions from retirement plans People who earn income via the gig economy Anyone who wins a prize that has cash value Anyone who expects to owe $1,000 or more on their taxes at the end of the year How much should you pay? The IRS generally expects you to make quarterly payments that equal at least 90 percent of your estimated tax liability or 100 percent of the tax shown on your return for the previous tax year. You can pay whichever of those amounts is smaller via the Electronic Federal Tax Payment System . Note that the last estimated tax payment for 2022 is due on January 17, 2023. The first estimated payment for the 2023 tax year is due on April 18, 2023. Plan for future payments now to avoid a painful cash crunch at tax time. A version of this article appeared in our partner magazine, The Essential Tax Guide: 2023 Edition.