If you cancel 31 or more days from arrival date, the points go back into your account the same way they went in -- current use year points remain current, and banked or borrowed remain banked or borrowed.
But there is still a risk to consider, and that is your banking deadline, although it would not be an issue if you are cancelling 10 months before the arrival date of the reservation being cancelled. To be able to bank points, you must do so before the end of the eighth month of your use year, e.g., if your use year beginning month is March, banking must occur by no later than Oct 31. Thus, if a reservation is canceled after the eighth month of your use year, you will not be able to bank any of those current use year points and must use them for a trip that ends before your next use year begins. Moreover, if you used any banked or borrowed points for the original reservation, and then cancel at any time, those also must be used before the end of your current use year.
Example: March use year, and you reserve Dec 2-9, and then cancel on Nov 1, 31 days before date of arrival, but 1 day after the end of the 8th month of your use year. All points used for that canceled reservation must then be used for a reservation that ends no later than the end of Feb or they are lost. And to add insult to injury, you may learn that even if you can make a reservation that ends before the end of Feb, you may find nothing is open that you can reserve for the time you may want to reserve.