Zakat on Cash and Bank Accounts
The Ruling
Zakat on cash and bank accounts is due in full by the agreement of jurists: checking and savings account balances, cash, certificates of deposit (CDs), and money market accounts are all totaled, and 2.5% of the sum is due if it reaches the nisab and a full year has passed over it. The calculation is based on what is in all accounts on the day the hawl is complete, not an average balance across the year.
Example
Someone with a balance of $20,000 in cash and savings, which has reached the nisab and been held for a full year, owes: 20,000 × 2.5% = $500.
Emergency Funds and Currently-Due Expenses
An emergency fund is also zakatable and is not excluded from the pool. Currently-due obligatory expenses, such as an outstanding bill or the current month's rent, are deducted from the pool by those who hold that due debts should be deducted (see the article on "Debts You Owe").