Zakāt is Fard upon a person if he/she is:

1. Muslim

2. Adult

3. Sane

4. Owner of wealth at least the value of Nisāb (the Quantum)

Furthermore the wealth must be

a. Fully owned by the person

b. In excess of personal needs (clothing, household furniture, utensils, cars, etc.)

c. It should be possessed by the person for at least complete Islamic lunar year (see Nisāb, Hawl section)

d. Monetary wealth (i.e. gold, silver, cash, etc.), livestock, or trade goods.

Note: There is no zakāt on assets that are not of a productive nature even if these are in excess of ones needs, such as cars, utensils, houses, furniture etc. as long as such items are not intended for trade.

There is no zakāt on those whose short term liabilities due immediately exceed or equal their assets.

For example: A person has $1,000 in silver at hand but has $1,200 in debt due immediately.  This person has no zakāt due.  IMPORTANT: Long-term loans such as house mortgages, car loans, student loans, etc. are not to be used in this calculation.  However, the yearly payment of these loans due this current year may be used as a liability.

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Prepared by Darul Ifta, Shariah Board, New York