As someone who’ is taxed like a sole proprietor, no tax is withheld from your pay. This means you’re required to prepay your taxes in advance throughout the year.
These tax payments are known as estimated taxes. As the name implies, you have to estimate how much money you’ll make during the year, and pay enough to cover the income and self-employment tax you’ll owe.
If you estimate wrong and pay too little you’ll be hit with a penalty. However, you can avoid the penalty if you pay at least as much as you paid the prior year (110% as much if you earned more than $150,000).