According to a TRS publication, the 20% is mandatory :
"Refunded amounts that represent tax-sheltered contributions
are subject to a mandatory 20 percent federal
income tax withholding unless you elect to roll over
all eligible amounts to another qualied plan or to a traditional
Individual Retirement Account (IRA). A 10 percent
early withdrawal penalty assessed by the Internal
Revenue Service (IRS) may also be applicable. "
"https://www.trs.texas.gov/TRS%20Documents/request_refund.pdf
____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*
