What do I do if I didn't deposit a check from a 401k distribution?

[Bsch4477]

It will be income whether you deposited it or not. 

[corona-nery]

Even if I ask for a reissue of the check. Won't the funds go back to the 401k acct if the check were never negotiated?

[VolvoGirl]

Ask the plan how to handle it.  

[JohnB5677]

There are two points to be made.

• This is taxable income.
  • A check was prepared and issued to you.
  • The IRS considers that the money was available to you, regardless if you cashed it or not.
  • You must report the 1099-R as income.
• The money will be in an account "on Hold" as a credit to your 401-K account, 
  • The check was distributed, so as far as the plan is concerned it's gone.
  • Even thou you didn't cash it.  It is not available to the account to be invested.
  • As @VolvoGirl  said, you should contact the plan manager.
  • You should be able to request a new check.

Please contact us again with any additional questions.

[Opus 17]

Because the check was sent to you and was cashable (at least for a while), it is considered to be received by you (doctrine of constructive receipt) even if you did not cash it.  Therefore, it is taxable to you since you did not roll it over to a new account within 60 days.  For the same reason (constructive receipt) I believe John is correct that the 401k withdrawal can't just be "canceled" with the money returned to tax-free status (not after 60 days).  It is probably in a holding or escrow account until you deposit the check or ask for it to be reissued.  

[Edited to add] Although you can't cancel the withdrawal, you may be able to waive the 60 day rollover rule and complete the rollover by depositing the check into an IRA or other qualified plan, if the plan administrator will accept it.  See Revenue procedure 2016-47. 

[Opus 17]

Whoops, this needs to be updated.

"the distribution, having been made in the form of a check, was misplaced and
never cashed" is one of the reasons you can get a waiver of the 60-day rollover rule.  See question 6 on this page "How do I self-certify that I qualify for a waiver."

https://www.irs.gov/retirement-plans/retirement-plans-faqs-relating-to-waivers-of-the-60-day-rollove...

https://www.irs.gov/pub/irs-drop/rp-16-47.pdf

You must complete the rollover within 30 days of discovering the error.  Call the issuing bank and ask for a new check.  Then call the IRA you want to receive the funds and ask if they will accept a late rollover if you provide a copy of a self-certification letter that follows the model letter in IRS revenue procedure 2016-47.  If they won't accept a late rollover under the model rule, you may need to find another IRA bank to accept the check.  (Once the check is accepted in bank A, you can do another rollover to bank B if bank B is your preferred bank, but this time do a direct transfer.)

You submit the self-certification letter to the IRA trustee, you do not include it with your tax return, but keep all your records for at least 6 years. 

[Opus 17]

Short summary.  You can't cancel the withdrawal and put the money back into the 401k.  But you may be able to get the IRA trustee to waive the 60 day rollover rule.  See my other answer.