Hi lorinye!
Excellent question. The government operates as pay-as-you-go. As income is collected, they require their cut at least on a quarterly basis. That also means that there is an underpayment penalty for not paying the tax liability in the same quarter the income is received. The penalty for underpayment of quarterly taxes is based on the tax liability outstanding, calculated in three-month intervals. If your business has a net profit (income minus expenses), then you should consider making quarterly payments.
TurboTax has tools for this. Check out the Self Employment Tax Calculator or TaxCaster Tax Calculator. They will help you determine how much to pay and when.
