Unless the loan and the withdrawal were from different 401(k) plans, the payoff of the loan by reducing the balance to your credit in the 401(k) should have been done by a offset distribution reported with code M (perhaps along with a second code) in box 7 of the Form 1099-R. The code M indicates that you have until the due date of your tax return, including extensions, for the year of the offset distribution to come up with the money to roll this distribution over to another retirement account, perhaps a traditional IRA, to continue to defer this income. If not rolled over, the distribution is taxable and subject to potential early-distribution penalty.
