These eight categories are essentially the only categories that zakat can be given to.
1-2- Sadaqah or charity is given to the fakir and the miskeen.
There is a slight difference between fakir (poor) and miskeen (needy). Fakir is somebody who has absolutely nothing; and miskeen is somebody who has something but not enough to live by.
So, if somebody doesn’t even have a house they’re living in this is fakir; and if somebody has a house for example but they have so many debts or they cannot provide for their children in a reasonable manner, then this is miskeen.
So, zakat is given to those who are struggling and they’re not able to provide a reasonable amount of living for their family.
What and who gets to define reasonable?
You may ask your local authorities, your local scholars whom you look up to that what is the definition of reasonable or what is the minimal that is required in order for a person to be zakat illegible.
3- Those who are working for it.
Once upon a time the caliphate had zakat department and so there are people they go and they collect zakat and they distributed. These people need a salary, so Allah says those people can be paid their salaries from the zakat money.
4- To people whose hearts need to be reconciled. That’s not done on an individual level, me and you we don’t decide.
5- For the freeing of slaves. There are no slaves to be freed, so that is not an issue.
6- For those that are in severe debt for specific again, these are not relevant.
7- For those that are in the path of Allah.
8- Those that are lost the Wayfarers, the travelers who are cut off from their sources of income.
Focus on these Two Categories
For most average Muslims, zakat is given to the first two categories; that’s really what we need to worry about. The other six by and large are not really relevant for the average Muslim, the general rule.
So, we find people who are poor and needy, essentially those people that are struggling for food, for their children, for themselves, those people who don’t have even what we would call the minimal acceptable existence really in their societies and cultures they may be given zakah.
Can we Give to Family?
Zakat can be given to blood relatives that are not your descendants or ascended. So, you can give zakat to your cousins, your uncles and aunts, your extended family… But you cannot give it to your mother and father, or to your son and daughter, or to your wife; because you are obliged to take care of your mother and father, your son and daughter, and your wife.
Generally speaking again there are exceptions for all of these rules, make sure you ask a scholar. But generally speaking, you may give zakat to your siblings, your cousins, your uncles and aunts… This would be permissible if they are zakat eligible, if they are in such poverty that they need to be given zakah.