Standing immediately on, beside, or even in a general vicinity is considered by the game to be too far away.
However, I have found a temporary solution to stop being so far away, go further.
If it says too far, back up. Keep backing up until you’re right on the edge of being able to interact with it at all. Seems counterproductive and not 100%, but works more reliably than not at all at least.
Upon seeing the thread title, I expected someone ranting about how sacrificing people on an altar goes too far, but then see you saying you need to go farther.
I have this issue too. I have to find the right angle before it lets me interact. Same with thaumaturgy bench. I´ve found it was impossible to use while it was placed near a wall. It also has some difficulties when placed on ceilings or foundations. The interactions work fine when it´s on natural surface however.
It seems to be getting worse the longer the station is placed. I had this bug and replaced the altar and it worked right away. But after it was placed for some time it was impossible to use again