Answered by Ustadh Salman Younas
Question: Can zakat be converted into donation and how? Secondly, if an organization collects zakat is it obligatory for them to disburse it in the same year?
Answer: assalamu `alaykum
1. Zakat is a form of donation to poor, Muslim individuals. It can be given in cash or items that are of a monetary-equivalent.
2. An organization that collects Zakat for disbursement would be considered an ‘agent’. As such, they would only be obligated to disburse the Zakat within a specific time period if their is an agreement to do so between them and those who have tasked them with disbursing their Zakat.
Generally speaking, Zakat should be disbursed without undue delay. An undue delay is to delay payment beyond a year from when it is due. [Ibn `Abidin, Radd al-Muhtar] One should look into the policies of Zakat agencies to ensure that their Zakat is being disbursed in a timely and proper manner.