In this example below , for a 50 year , i see

**Qx**= 0.002409 and

**Ix**= 966677 ( i guess

**Qx**is the probability that a person exact age

**x**will die within one year. and

**Ix**is the number of persons surviving to exact age

**x**. and the interest rate is 2.98%. How does it compute to the annuity factor 21.345. Thanks

Reference: https://www.irs.gov/retirement-plans/re ... c-payments

https://www.irs.gov/pub/irs-drop/rr-11-10.pdf

*Fixed annuitization method*

The fixed annuitization method consists of an account balance, an annuity factor and an annual payment. The annuity factor is calculated based on the mortality table in Appendix B of Rev. Rul. 2002-62 and an interest rate of not more than 120% of the federal mid-term rate. Once an annual distribution amount is calculated under this method, the same dollar amount must be distributed in subsequent years.

Under this method the annual distribution amount is equal to the account balance ($400,000) divided by an annuity factor that would provide one dollar per year over Bob’s life, beginning at age 50. The age 50 annuity factor (21.345) is calculated based on the Rev. Rul. 2002-62 Appendix B mortality table and an interest rate of 2.98%. The annual distribution amount is calculated as $400,000/21.345 = $18,740.

The fixed annuitization method consists of an account balance, an annuity factor and an annual payment. The annuity factor is calculated based on the mortality table in Appendix B of Rev. Rul. 2002-62 and an interest rate of not more than 120% of the federal mid-term rate. Once an annual distribution amount is calculated under this method, the same dollar amount must be distributed in subsequent years.

Under this method the annual distribution amount is equal to the account balance ($400,000) divided by an annuity factor that would provide one dollar per year over Bob’s life, beginning at age 50. The age 50 annuity factor (21.345) is calculated based on the Rev. Rul. 2002-62 Appendix B mortality table and an interest rate of 2.98%. The annual distribution amount is calculated as $400,000/21.345 = $18,740.

Appendix B mortality table:

https://www.irs.gov/pub/irs-irbs/irb02-42.pdf

Definitions:

https://www.ssa.gov/OACT/HistEst/PerLif ... itions.pdf