A taxpayer who is self-employed or one who expects to have considerable other income in 1986 that is not subject to income tax withholding -- interest and dividends, rental income, IRA or Keogh withdrawals, other pension or retirement income -- must make special arrangements to comply with federal pay-as-you-go income tax rules. (If you expect to be subject to the alternative minimum tax, you must include that amount when determining whether estimated tax is due.)

If you are employed by another, federal income tax normally is required to be withheld from your pay unless you had shown -- on Form W-4 that you filed with your employer -- that you were entitled to a large enough number of exemptions to avoid withholding.

Withholding is optional on taxable distributions from pension and profit-sharing plans, IRAs and most commercial annuities. Generally, tax will be withheld, however, unless the recipient specifically directs the payer not to withhold.

There are a number of exceptions to the requirement for paying estimated tax. The requirement is waived if you meet any of these conditions:

*Your gross income for 1986 is not expected to exceed $5,000 if you are married but not entitled to file a joint return; or $10,000 if you are married and will file a joint return and both you and your spouse are employed, or $20,000 if you fit any of the other filing categories.

*You expect that your gross income for 1986 will not include more than $500 of taxable income not subject to withholding.

*You expect that either your total tax liability or your net tax deficiency -- that is, the difference between your total tax liability and the amount of tax withheld during the year -- will be less than $500.

Although the rules specify a $500 deficiency as the trigger for filing an estimate, you may not have to pay any estimated tax even if your figures show an expected deficiency greater than that amount.

That's because you are not required to pay the full amount of the estimated shortfall. You are only required to pay enough tax, by withholding or estimate payments or a combination of both, to equal 80 percent of the eventual tax liability. So if withholding for the year will equal or exceed 80 percent of your estimated total tax, you can forget the whole thing.

But if your income is uncertain, you may want to make a payment of estimated tax sufficient to provide a small cushion above that 80 percent minimum, to avoid the imposition of a penalty in the event your estimate was off a little.

You file estimated tax on Form 1040-ES. If you filed an estimated tax return for 1985 and are still living at the same address, you should have received a 1040-ES package for 1986 in late January, with your name, address and Social Security number preprinted on the forms.

If you didn't get a package in the mail and think you are liable for filing an estimated tax return for 1986, pick up the forms at any IRS office or request them by mail from the address given in your IRS instruction booklet.

The 1040-ES package includes a worksheet for estimating your tax deficiency, plus four payment vouchers and mailing envelopes. You may pay the entire deficiency with the first voucher, due April 15. You probably will prefer to send one-fourth of the total with that first voucher, then additional payments of one-fourth each by June 16 and Sept. 15, and Jan. 15, 1987.

If you ended up with an overpayment on your 1985 tax, you may elect to have all or part of that overpayment credited against your 1986 tax instead of being refunded to you. Each of the four estimated tax vouchers provides a space for claiming credit for the 1985 overpayment; you may take the entire overpayment on the first voucher(s) or spread the total overpayment evenly over all four vouchers.

If your estimate of eventual tax liability changes during the year, simply adjust the remaining payments to correspond to the new balance due -- whether it's more or less than your original estimate. In the event that you're not liable for estimated tax on April 15 but later determine that you have become liable, file an initial 1040-ES on the next regular payment date and divide the total amount of the newly estimated deficiency evenly over the remaining number of payments.

There is an alternative to filing estimated tax even though you expect a substantial amount of 1986 income not subject to withholding, if you also receive wages or retirement pay subject to withholding. You may file a new Form W-4 with your employer claiming a lesser number of withholding allowances, thus in effect directing him to withhold a larger amount of money from your pay than would be required.

If you get down to zero allowances and want still more money withheld, you may specify an additional number of dollars to be withheld each payday, if your employer agrees. You can thus ensure having enough withheld to cover your entire tax liability (or at least 80 percent of it), eliminating the need to file an estimate.

You also should file a new Form W-4 to reduce the amount of tax withheld if your tax situation has changed or if you have been getting a large refund every year. That refund in effect is an interest-free loan to Uncle Sam -- a noble gesture, surely, but not at all necessary. Some people see this overwithholding as a form of enforced saving, but if you can discipline yourself to cut down the withholding and put the extra dollars into some form of savings, it can be earning interest for you.

When completing a new W-4, you are permitted to claim additional withholding allowances for almost any circumstance likely to reduce your tax bill at year-end: large itemized deductions, an adjustment for alimony payments, a credit for child-care expenses.

But you may not claim more allowances than you are legally allowed. In any case, you should not reduce withholding below the proper level simply to generate more take-home pay. You may find yourself with a large tax bill next April -- plus an interest penalty for underpayment.