Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Dear brother in Islam, thanks a lot for your interest about Islam and its teachings. We do really appreciate your question, which shows how interested you are to adhere to the dictates ofShari`ah. May Allah save us all from the traps of Satan and enlighten our hearts with the light of Islam!
You are to bear in mind the fact that Zakah is one of the pillars of Islam. Zakah stands as the third pillar of Islam after testifying that there is no god but Allah and Muhammad is His final Messenger and offering Prayer. The Prophet (peace and blessings be upon him) said, “Islam is built upon five pillars: testifying that there is no true god except Allah and that Muhammad is the Messenger of Allah, performing Prayer, paying the Zakah, making the pilgrimage to the Sacred House (Hajj), and fasting the month of Ramadan.” (Reported by Al-Bukhari)
With regard to your question, Dr. Monzer Kahf, a prominent Muslim economist and counselor, answers:
The answer is generally yes, zakat-ul-fitr can be paid in cash if cash is better from the point of view of the recipient poor.
We have correct sayings by the Prophet (peace and blessings be upon him) that the due zakat-ul-fitr is one sa` (2,176 grams) of barley, dates, raisins, or dried yogurt. These were common foods in Madinah and its surroundings. At the time of the Companions (may Allah be pleased with them all), wheat started to become a food item for the well-to-do families, and was a lot more expensive than barley. They estimated that one sa` of barley is equivalent in value to half a sa` of wheat.
Consequently we have several reports from the time of the Companions (may Allah be pleased with them all) that they substituted value for the items that are mentioned in the saying of the Prophet (peace and blessings be upon him).
Ibn Taymiyah, one of the renowned scholars of the early ninth century of Hijrah, argued that the payment of zakat-ul-fitr in cash in metropolitan areas such as Damascus where he lived, is actually better for the poor.
In payment of zakat-ul-fitr the same criteria of payment of zakat-ul-Mal apply. This means that if you have a relative in need, then payment to such a relative would be better than payment to a stranger. By the same token, payment to people and families who are in dire need would be better than payment to others with milder need. Also, payment in the same area where you live is better than payment in other areas.
Applying all these together and considering the circumstances in areas where Muslims suffer from foreign occupation and deliberate action by foreign forces to make them suffer dire poverty, such as Muslims in Palestine, Iraq, Gujarat, and Chechnya, they certainly have higher priority for receiving zakat-ul-fitr and zakat-ul-Mal from Muslims in other areas, especially from us in the US.
Find the Muslim charitable organizations that make this relief reach these people, and it is better to pay your zakat-ul-fitr through such charities.
The amount of zakat-ul-fitr in the US today is 2-3 Dollars per person, the value of 2. 176 Kilogram of wheat since wheat is the main food item in North America (food item means the thing that is taken with meat, vegetable, etc. that are called Idam in Arabic as referred to in more than one Saying of the Prophet (peace and blessings be upon him). It is certainly more rewarding to give much in this blessed month of Ramadan. Your responsibility ends if you make your payment to the charitable organization before `Eid Prayer, even if the organization delays actual distribution until after the Prayer. However, it is better to pay zakat-ul-fitr earlier in this blessed month of Ramadan in order to enable the charity to actually distribute it by the `Eid Prayer. Many Muslim charities in America offer distribution before `Eid if we can help them plan well by making early payment. It is an exception because of the time needed for distribution.