a check was cut and a 1099 was issued for 2002 but the participant never received the check. should we issue a corrected 1099 for 2002 and issue a 1099 for 2003 the year the participant receives the check? for some reason i think you stick with the 1099 for 2002 along the lines of a constructive receipt thoery.

The 1099-R for 2002 stands.

Just in case…Recently the IRS issued guidance on extending the 60-day rule for rollover contributions that meets certain requirements. One of the determining factors that the IRS considers in making the decisions to extend the 60-day period is whether or not the check issued was cashed...

The following thread may provide some insight to this issue…

http://benefitslink.com/boards/index.php?showtopic=18166

appleby, under what is theory? just want to get some additional confirmation.

For qualified plans, there is no theory of constructive receipt.
Actual receipt confers tax consequenses.

Now you are in a factual quandry. Did the participant receive the check? In the past, we have relied on an affidavit that the check was never received.

Other issues to resolve, did participant receive other mailings?
Did the delivery address change.

If you are comfortable that there was no receipt, then "correct" 1099 for 2002, otherwise leave it in place and have participant resolve issue with IRS.