Calculation Methodology
Our zakat calculator follows the Fiqh Council of North America (FCNA) guidelines for contemporary assets, with support for all four major schools of Islamic jurisprudence.
Nisab Threshold
Nisab is the minimum wealth threshold above which zakat becomes obligatory. We offer two calculation methods:
Gold Standard
Recommended87.48 grams of gold (~$6,500 USD). The American Fiqh Academy recommends this method as it provides a more stable threshold.
Silver Standard
612.36 grams of silver (~$550 USD). Results in a lower threshold, meaning more people would be obligated to pay zakat.
Metal prices are fetched in real-time to calculate the current nisab value in dollars.
Cash & Savings
All liquid cash assets are 100% zakatable. There is scholarly consensus on this, so no method selection is needed.
Investments
For stocks, ETFs, and mutual funds, we offer two scholarly approaches based on your investment intent:
Balance Sheet Method
Long-term investorsIf you view your stocks as partial ownership of businesses you intend to hold long-term, only the zakatable assets of those companies are counted.
What counts:
- • Cash and cash equivalents
- • Accounts receivable
- • Inventory
We calculate this ratio using SEC EDGAR filings (10-K and 10-Q reports). For stocks without SEC data, we use a conservative 25% estimate per FCNA guidance.
Market Value Method
Active tradersIf you actively trade or view investments as inventory for sale, the full market value is zakatable (100%). Use this if you buy/sell frequently or plan to liquidate within a year.
Cryptocurrency
Cryptocurrency is always 100% zakatable regardless of your investment method selection. Unlike stocks, crypto does not represent ownership in a company with underlying business assets—it is treated as a currency or tradeable commodity, similar to gold held for investment.
Retirement Accounts
Retirement accounts (401k, IRA, 403b, etc.) have restricted access and penalties for early withdrawal. Scholars differ on how to handle these restrictions.
Two-step approach:
Choose your investment method
Balance Sheet or Market Value (same as regular investments)
Choose accessibility treatment
How to handle the restricted nature of these funds
Accessibility treatments:
Exclude Until Withdrawal
Most conservativeNo zakat is due until you actually receive distributions. The funds are not considered 'in your possession' while locked in the account.
Accessible Portion Only
Only count funds you can withdraw penalty-free. Typically applies after age 59½ when early withdrawal penalties no longer apply.
Net After Taxes & Penalties
Count the amount you would receive if you withdrew today, after accounting for income taxes and any early withdrawal penalties (typically 10% under age 59½).
Full Balance
Most stringentThe entire balance is zakatable regardless of access restrictions. Takes the position that you technically own the full amount.
Gold & Jewelry
Bullion & Stored Jewelry
Gold and silver bullion, coins, and jewelry kept in storage (not worn regularly) are 100% zakatable according to all schools.
Personal Jewelry
Treatment of regularly-worn personal jewelry varies by school of thought.
Personal jewelry by madhab:
Hanafi
All gold and silver jewelry is zakatable, regardless of whether worn regularly.
Shafi'i, Maliki, Hanbali
Personal jewelry worn regularly for adornment is exempt from zakat.
Business Assets
For business owners, only certain categories of assets are zakatable:
Zakatable
- • Business cash and bank balances
- • Accounts receivable
- • Inventory held for sale
Not Zakatable
- • Equipment and machinery
- • Real estate for operations
- • Business vehicles
Debt Deductions
Debts can be deducted from zakatable wealth. FCNA provides a tiered approach:
Immediate debts
Full balance deductible (credit cards, bills due now)
Essential bills
One month of essential obligations due within 30 days
Installment debts
12 months of upcoming payments for mortgages, car loans, student loans
Classical school variations:
Sources & References
Fiqh Council of North America
Contemporary zakat guidelines for modern assets
American Fiqh Academy
Contemporary Islamic finance rulings
SEC EDGAR
Public company financial statements for balance sheet calculations
Classical Fiqh Texts
Traditional rulings from the four madhabs
This calculator is provided for educational purposes. For complex financial situations or scholarly guidance, please consult with a qualified Islamic scholar or financial advisor.