You earn work credits any time you earn income that is taxed for Social Security. If you receive a regular paycheck, most jobs automatically withhold the amount of Social Security taxes needed. This withholding amount is listed under “Social Security” on your pay stub or the W2 you receive at the beginning of each new year.
Some occupations do not automatically withhold Social Security taxes, especially those that receive state funding and which tend to have their own retirement program. Independent contractors, including freelancers and self-employed individuals, also do not automatically pay into Social Security when they receive income. Instead, these individuals will need to estimate their needed Social Security contribution when they pay taxes at year-end. It is also wise to set aside the money needed to pay into Social Security and to make pre-payments to the IRS based on your estimated yearly income.
The good news is that it does not take much income to earn the maximum amount of work credits per year. As stated in the introduction above, you need just $1,470 per work credit in 2021, and that amount was lower in years prior. The only drawback is that you cannot earn more than 4 work credits per year.