This is that time of year for me again… I always get some or other confusion.
So need your help..
Last year Faisal bhai’s help was good. I hope he replies again.
Question 1: On Cash in bank..
Do one need to pay zakat on
The **minimum balance **that one had during that year
OR
The amount that one has **right now** in his bank.
Question 2: On 401 K,
Do one need to pay zakat on
** All** the money that has in his 401 K right now.
OR
Only those money that he has **contributed minus emplyer contribution minus Tax and Penalty that he will have to pay if he withdrew money today**
During my research on Internet I found out fatwa’s on both options.
Answer to question 1: The zakat is on the amount that has survived one year in your account, which means the minimum balance during the year.
Answer to question 2: It is a tricky question, the reason is that you are not owner of FULL amount (unless you are eligible to withdraw all without any penalty/extra-tax). The way I have been doing is that calculate the approximate amount that I will get if I were to withdraw all of my 401(k) (caluclate using the minimum of 401k amount in the last year) and minus the approximate taxes I'd have to pay. Whatever you or employer contributed is YOURS (depends on "Vesting").
Thanks Captain. My personel opinion is like yours. Sounds logical. Lets hear back from others.
Looks like,I have been paying more Zakat for last few years. Can I re-file?
Uhm Ok is zakat necessary only if ur makin steady money?
I just got a job this month (first ever ) and got my paycheck yesterday ($70). I donated two dollars to the charity box sitting on those tables selling Qurans and Islamic books in Jackson Heights. does that count?
If your niyat was of Zakat and if the the purpose of charity was same as what is meant for zakat then yes it counts.
You are suppoed to pay zakat only on those money which you save at end of year (You can decide what day will be your financial year start and do yoru calculation on same day every year.Many people do it during Ramdhan) after your all living expnses are taken care of
f&b, I think you and Captain are on the right track. Its the minimum balance (i.e. unutilized amount) in the bank. For 401(k) there are various opinions, but the one I feel is closest to correct is that zakat should be calculated on the amount you can currently withdraw (after penalties and tax). That is your current asset.
Zakaat is only fardh on people who remain Saahib-e-Nisaab during one lunar year. that is one has in his/her possessions of atleast 612.36 g of silver or its equivalent in cash or stock or only 87.48g of gold or its equivalent in cash or stock.
Now, there are various situations when one does not remain eligible to pay zakaat (40th part [2.5%] of one’s belongings) …
If the person was saahib-e-nisaab during the whole year till the end of it, then, he/she ought to pay zakaah on whatever belonging is left at the end of the year.
Wallah-O-Alam!
It is advised to contact a learned scholar for such critical questions so that we may have more access to the correct rulings in the light of Quran and Sunnah.
^ If you want to pay more zakat, then more power to you. But the actual zakat is due only on the amount that remain unutilized and untouched during an entire year. So its not necessary to pay off zakat each month for different levels of bank balance.
^
having said that, one condition is that the person remains eligible to pay zakaah during the beggining and end of the year. In that case, the easiest way is to pay zakah on the amount currently present at the end of one year.
) and got my paycheck yesterday ($70). I donated two dollars to the charity box sitting on those tables selling Qurans and Islamic books in Jackson Heights. does that count? 
