If you owe IRS a lot, you may need to pay estimated taxes

— -- Most taxpayers dread April 15 but take comfort in the knowledge that it occurs only once a year.

That's not the case, though, for millions of people who are required to pay estimated taxes. Sadly, these folks face a tax-filing deadline every April, June, September and January.

If you expect to earn self-employment income this year, or plan to cash in some of your investments, you should familiarize yourself with the rules governing estimated taxes. Otherwise, you could find yourself paying a penalty next April, even if you've sent the IRS a check for the amount you owe.

Here's why: The federal tax system works on a pay-as-you-go basis. You're expected to pay taxes on most of your income all year round.

That's usually not a problem if roughly the amount of tax you owe is regularly withheld from your paycheck. But if your withholding falls short by a significant amount, the IRS will charge you a penalty for underpayment. The IRS may also require you to file estimated tax returns for the next year.

Self-employed taxpayers are accustomed to paying estimated taxes. But even if you work for an employer that withholds taxes from your paycheck, you might not be off the hook. Factors that could trigger an underpayment problem:

•In addition to your regular job, you earn income from freelance or contract work.

•You sell stocks, bonds or other property for a sizable profit and have no losses to offset those gains.

•You lose large deductions or credits. Suppose, for example, you sell your home and move into an apartment. The subsequent loss of your mortgage-interest deduction could trigger a much higher tax bill. Unless you adjust your withholding, you could end up underpaying your taxes.

Fortunately, the tax code gives you some room to maneuver. In general, if you owe less than $1,000 when you file your taxes, the IRS won't hit you with underpayment penalties, says Mildred Carter, senior tax analyst for CCH, a publisher of tax reference books and software. And if your withholding and credits equal 90% of your tax bill, you won't be penalized, either.