I plan to begin taking SEPP distributions from my 401k on Sept 1 this year. The payments will be equal amounts taken monthly for 5 years as I will be 60 by Sept 1, 2028. Since this year I will only have 4 months of distribution payments (Sept-Dec), the 1099-R form I receive for 2023 will not reflect a full year. In 2024, my 1099-R will reflect a full year amount as will 2025, 2026 and 2027. But 2028, would only reflect 8 months of distribution payments if I stop the distributions after August 2028. Can you confirm this would not be subject to the 10% tax penalty and not be a red flag for the IRS? And then what if starting Sept 1 of 2028, I choose to increase the amount of my monthly distribution, my 1099-R will reflect a higher amount of distributions for 2028. Will IRS know that I satisfactorily maintained the "substantially equal periodic payments" that meets the minimum requirement of 5 years so I can avoid the 10% tax penalty? And how does Turbo Tax handle this when I file my tax returns?
