Why blocks need it
Fabric shifts a little as you piece and press. Small differences add up across a row, leading to uneven rows and puckered seams. Squaring up trims each block back to square and to the right size before the blocks are joined.
Trim to the unfinished size
Trim to the unfinished size your pattern specifies. With a ¼ inch seam allowance at each edge, a square block is ½ inch larger in each dimension before joining. A block that finishes at 12 inches is therefore 12½ inches square unfinished. Check the allowance and preserve the points before trimming; you cannot add the cut fabric back. See finished and unfinished size.