Zakaat.

[The_Jinx]

Re: Zakaat.

@X2

Any gains in retirement accounts are not realized income or wealth.

In my view, Paying zakat on any gains for that year is fine as long as then you subtract the costs including fines, higher taxes etc that you would face if you were to take that money out.

I asked our local Alim/Imam in Isha last night, who is a graduate from Jamia Darul Uloom Karachi in the area of Takhassus Fil Iftaa, Islamic Jurisprudence and had been a diligent student of Mufti Rafi Usmani, elder brother of Mufti Taqi Usmani.

His views about 401K ware that you are responsible to pay zakaat on the amount you own in 401K. So, if the total saving in 401K is, let’s say 20,000 but if you were to take out that money now, the penalty, taxes and any overhead you have to pay on it, needs to be subtracted and the zakaat is calculated on the remaining balance not the actual balance.