Clear Money Guide
What this guide covers
A quick view of the questions and evidence developed below.
Updated July 28, 2026. Quick answer: The amortization and annuitization methods need an interest rate, and Notice 2022-6 permits using a stated floor rather than being limited to the market-linked figure. A higher permitted rate produces a higher payment from the same balance.
Why the rate drives the payment
Both fixed methods discount a stream of payments. A higher assumed rate produces a larger annual payment from the same account balance — so the rate you are permitted to use directly determines how much income the schedule can generate.
What Notice 2022-6 changed
When market rates were very low, the linked figure produced payments too small to be useful for many people. The notice permits a floor, so a schedule can be built on the floor rate when the market-linked alternative is lower.
Under Notice 2022-6, the interest rate used for the fixed amortization or fixed annuitization method may be any rate not more than the greater of 5% or 120% of the federal mid-term rate for either of the two months immediately preceding the month in which distributions begin. Those published rates change monthly, so this page does not quote a current number — confirm the applicable figure for your start month before calculating.
Get a second opinion before you lock in a schedule
An early-withdrawal schedule commits you for years and is expensive to break, so it is worth having someone check the amount, the account it runs on and the alternatives against the rest of your plan first.
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The trade-off
A higher rate means more income now and faster depletion. The account has to sustain the payment for the full duration, and a change to the payment other than the one permitted switch to the required minimum distribution method is generally a modification under IRC §72(t)(4). Maximising the payment is not the same as choosing well.
Figures verified against Notice 2022-6, Rev. Rul. 2002-62 and 26 U.S.C. 72(t) on September 29, 2026.
Sources
IRC §72(t) (10% additional tax and its exceptions); IRC §72(t)(2)(A)(iv) (substantially equal periodic payments); IRC §72(t)(2)(A)(v) (separation from service at 55); Rev. Rul. 2002-62 (modified and superseded by Notice 2022-6 for a series of payments commencing on or after January 1, 2023); Notice 2022-6. The federal mid-term rates used in these calculations change monthly and are not quoted here.
This states what the cited authority says. It is not tax advice, and a SEPP schedule is unusually unforgiving of small errors.