Small business owners and contractors often miss a key step: setting aside money for self-employment tax (and income tax) because their payments don’t have withholding. Consider Ben, a freelancer who received multiple 1099 payments and treated them like take-home pay. At year-end he owes both income tax and self-employment tax, plus potential penalties for underpaying estimated taxes. Recognizing when to make quarterly estimated payments or increase withholding is an important behavioral step that avoids surprise balances and penalties. This scenario asks what Ben should have done during the year.