Free calculator
72(t) SEPP Calculator
Estimate substantially equal periodic payments for penalty-free withdrawals before age 59½, then check the rules and limits before acting.
Reviewed September 2, 2026
Short answer
A 72(t) SEPP can avoid the 10% additional tax on early withdrawals when payments follow an IRS method and continue for the longer of five years or until age 59½. $300,000 at age 53 produces about $8,982 per year under the RMD method or $18,657 with fixed amortization at 5%.
Must not exceed the permitted rate
120% of the applicable federal mid-term rate
- RMD method (lower)$8,982
- Up to fixed amortization$9,675
With these inputs, the RMD method starts at approximately $8,982 per year and fixed amortization produces approximately $18,657 per year. Fixed annuitization is not calculated here.
Uses the IRS Single Life Expectancy Table under Notice 2022-6. Enter a maximum rate no greater than the larger of 5% or 120% of the federal mid-term rate for either of the two months before payments begin. Covers the RMD and fixed-amortization methods; fixed annuitization is not modeled.
This is an educational estimate, not tax or financial advice. Figures reflect the law year shown and the inputs you provide. Consult a qualified professional before acting.
Sources
- Substantially equal periodic payments — Internal Revenue Service
The three permitted SEPP calculation methods and the governing guidance.
Accessed September 2, 2026
- Notice 2022-6 — Internal Revenue Service
Current life-expectancy tables, permitted interest rates, and SEPP modification rules.
Accessed September 2, 2026
- Revenue Ruling 2002-62 — Internal Revenue Service
The three SEPP methods, fixed-payment treatment, and consequences of modifying a payment series.
Accessed September 2, 2026
- Applicable federal rates — Internal Revenue Service
Monthly federal mid-term rates used to determine a permitted SEPP rate.
Accessed September 2, 2026
How it’s calculated
- The RMD method divides the account balance by a permitted life-expectancy factor and recalculates the payment each year.
- The fixed-amortization method produces one annual amount using a permitted life-expectancy table and an interest rate no greater than the larger of 5% or 120% of the federal mid-term rate for either of the two months before payments begin.
- The fixed-annuitization method uses an annuity factor under Notice 2022-6. This calculator describes it but does not calculate it.
- Once payments begin, they generally must continue without modification for the longer of five years or until age 59½.
Worked 72(t) example
- Account balance
- $300,000
- Age
- 53
- Entered rate
- 5%
- Single Life factor
- 33.4
Result
About $8,982 per year under the RMD method or $18,657 under fixed amortization.
The RMD amount can change as the account balance and divisor change. The fixed-amortization amount generally remains fixed. This is an illustration, not a SEPP election or plan document.
What this calculator does not cover
- Fixed annuitization is not calculated.
- The tool does not determine which accounts qualify or administer a SEPP plan.
- Death, disability, transfers, one-time method changes, and other exceptions require plan-specific review.
Frequently asked
- How long must the payments continue?
- For the longer of five years or until you turn 59½. Modifying them early generally triggers the 10% penalty retroactively on all prior SEPP withdrawals, plus interest.
- Which interest rate do I use for amortization?
- Notice 2022-6 permits a rate no greater than the larger of 5% or 120% of the federal mid-term rate for either of the two months immediately before the month payments begin. A higher permitted rate produces a larger fixed-amortization payment.