With regard to MayaD's original suggestions 1 through 3, "if you qualify" means that you are required to have been born before January 2, 1936. I suspect that you do not qualify for any of the special lump-sum tax treatments, otherwise you would also need to be asking about RMDs.
The amount by which your 2023 tax withholding (and any estimated tax payments for 2023) exceeds your 2023 tax liability becomes your 2023 tax refund that you would receive in 2024.
If your taxable income in 2023 will be around $16,000, it would probably make sense to avoid the mandatory 20% tax withholding on the pension buyout by doing a direct rollover of the distribution to a traditional IRA and then taking distributions from the traditional IRA as needed where you can decline tax withholding. This will avoid having around $3,200 tied up until at least early 2024 when you could receive a refund.
The same penalty exception for disability applies to distributions from IRAs. Having the money in an IRA also allows you the opportunity to spread the distributions over more than one year, potentially reducing the marginal tax rate on the distributions.
