So you think the OP, who has already filed a tax return claiming the distribution received 9.months ago was the first withdrawal of a SEPP, can just amend his return and effectively change it to a regular withdrawal subject to 10% early withdrawal penalty and that's it? Sounds way to easy to me... I'm skeptical that will be accepted.
Yes. It's my opinion that until the second P of a SEPP is taken, that the taxpayer has leeway to determine how the first P is treated. This can include either treating it as (a) the first P of the originally planned SEPP, (b) an early withdrawal subject to a 10% EWP, or (c) the first P of a different SEPP where the taxpayer changes the interest rate used or the method, as long as the math works with the new SEPP plan and the interest rate meets the requirements.
I did mention that the way the original withdrawal was coded on the 1099-R may affect things, and that the OP should consult a qualified preparer that knows their full situation, and I repeat those points here.
I generally take the position that generally speaking a taxpayer can take any position as long as it is not specifically disallowed by applicable tax law. This scenario is one example where if I were in the OP's position, I would apply that rule. There is no series of payments until a second payment is made, and there is no rule saying one can't change their mind after the first payment but before the second payment. The rules only require that any series of payments which eventually occur meet the method and interest rate rules set by 72(t). By canceling the SEPP before the second payment, OP never takes a series of payments, and therefore never is subject to the rules of 72(t). And by changing their mind, which again, taxpayers are allowed to do, and treating it as a single early withdrawal and paying both the income tax and the EWP via an amended 1040-X, has fully complied with the law in my view.
I also acknowledge that many taxpayers would not feel comfortable with that approach, and I respect their decisions and opinions.