Distribution check was issued in 2001 as a direct rollover, Code H. Check was never cashed. Contacted individual, said the company receiving the rollover went out of business & wants new check issued to him. Is it best to have the replacement issued as a rollover (Code G or H) so we don't need to do a corrected 1099-R?

To issue the check directly to him without withholding 20% is not allowable. If his balance is over $5,000, I would say the 90 days has passed and he needs to complete new election forms. If his balance is under $5,000, you could cash him out (20% withholding) but not issue a new rollover check because again the 90 days has passed.

So either way, your 2001 1099 is incorrect and needs to be corrected.