The IRS requires that TRS withhold 20% of the taxable portion of any lump-sum death benefit paid to a surviving spouse, unless the spouse instructs TRS to directly roll over the amount into an IRA or a Section 401 Plan. In addition, the IRS requires that TRS withhold 10% of any death benefit paid to a non-spouse beneficiary, unless that beneficiary elects to have a percentage greater than 10% withheld. Any withheld amount will be sent to the IRS as credit toward the beneficiary's federal taxes for the year of distribution.

For a list of forms on taxes and death benefit payments, please see the Withdrawals/Distribution category in the Forms–Beneficiaries section.