A waqf (plural: awqāf) is an Islamic endowment of property or capital whose principal is made inalienable, while the income or “usufruct” is dedicated permanently to a religious, charitable, or family purpose. In classical Islamic law, once a waqf is established it is effectively “frozen”: the asset itself cannot be sold, gifted, or inherited, and the founder (wāqif) loses ownership, while specific beneficiaries or causes gain a perpetual right to benefit from it. Typical examples historically included mosques, schools, fountains, hospitals, and income‑generating assets like shops or farmland whose revenue would maintain those institutions. The key elements are irrevocability, perpetuity (or long duration), and binding dedication to a designated purpose consistent with Sharīʿa (Islamic law).
Historically in Muslim-majority societies, awqāf formed a huge portion of what we might now call the “civil society” or nonprofit sector. Before the modern welfare state, many education, healthcare, and social services institutions were funded and sustained through waqf income rather than direct state taxation. Ottoman, Mamluk, and other Islamic polities often relied on waqf-funded schools (madrasas), caravanserais, bridges, and public works. Because a waqf was designed to last indefinitely, it created long-term, intergenerational support for religious and social goods, while also giving wealthy individuals a way to create continuing charity (ṣadaqa jāriya) that earns spiritual reward even after their death.
In classical fiqh, setting up a waqf involved a formal declaration by the wāqif identifying (a) the property, (b) the purpose or beneficiaries, and (c) the administrator (mutawallī or nāẓir). Once declared in the proper form, the waqf became binding and, in many schools, irrevocable; courts would enforce its terms even against the founder and their heirs. The mutawallī has a fiduciary-like duty to manage the property prudently, maintain the asset, and distribute income in accordance with the deed of waqf. Islamic judges (qāḍīs) historically supervised awqāf, resolved disputes, removed negligent administrators, and sometimes adjusted details while trying to preserve the founder’s intent.
There are several types of waqf. A charitable waqf (waqf khayrī) benefits the public or a class of people (e.g., students, the poor, or a particular community). A family waqf (waqf ahlī or dhurrī) benefits the founder’s descendants or relatives, often with a condition that if the family line ends the proceeds revert to a charitable purpose. There can also be mixed waqf (mushtarak), where both family and public beneficiaries share in the income. Traditionally, a waqf could be real estate, movable property, or even cash (“cash waqf”) in some legal schools, where the capital is invested and its profits distributed. Modern Islamic finance has revived interest in cash waqf and “waqf-based” financial products that provide structured, Sharia-compliant endowments.
Conceptually, a waqf is quite close to a charitable trust or an endowment fund in common-law systems like that of the United States. In both, a founder sets aside property whose principal is intended to be preserved (or at least managed prudently) while income is used for specified public or charitable purposes. Trustees or board members manage the assets and owe duties of loyalty and care. Courts can step in to enforce the terms, and doctrines like cy-près can adapt charitable trusts when their original purposes become impossible or impracticable. The main differences lie in religious requirements (e.g., Sharia-compliant investments, restrictions on beneficiaries) and some structural rules (like the classical insistence on inalienability and certain formalities).
The United States, however, does not have a dedicated legal category called “waqf.” Instead, any Muslim community wanting to establish something functionally equivalent must do so using existing U.S. legal vehicles: typically nonprofit corporations, charitable trusts, private foundations, or possibly combinations thereof.
At the federal level, tax-exempt status generally falls under Internal Revenue Code §501(c)(3) for religious, charitable, educational, or similar organizations. At the state level, you have statutes governing nonprofit corporations and/or charitable trusts, plus oversight by state attorneys general. So a waqf in the USA is really a Sharīʿa-informed design choice applied to legally recognized American entities, rather than a separate legal category recognized by statute.
A common way for a Muslim community in the U.S. to “create a waqf” is to form a nonprofit corporation (or a charitable trust) whose charter and bylaws mirror the traditional waqf features. For example, the articles of incorporation and trust documents can specify that certain properties are dedicated in perpetuity to maintaining a mosque and Islamic center, cannot be sold except under very restrictive and defined circumstances (e.g., eminent domain, destruction, or relocation with court approval), and must always be used for Islamic religious and charitable purposes. The organizational documents can also define a succession process for trustees/mutawallīs, conditions for replacing administrators who breach their duties, and procedures for what happens if the original purpose becomes impossible—often modeled on cy-près, but worded to maintain a Sharīʿa-consistent reallocation of benefits.
Governance in a U.S.-based waqf-like entity must satisfy both Islamic expectations and secular legal requirements. Under state nonprofit law, directors or trustees have fiduciary duties of care, loyalty, and obedience to the organization’s purposes. This aligns well with the mutawallī’s role in fiqh but adds explicit statutory obligations, conflict-of-interest rules, and sometimes mandatory recordkeeping or reporting. Many Muslim organizations therefore structure their boards so that (a) they fulfill state-law governance standards, and (b) they incorporate Islamic oversight, e.g., an internal Sharīʿa advisory board or religious committee that reviews major decisions—especially those touching investment, sale of property, or changes in programmatic focus—to ensure ongoing compliance with Islamic principles and donor intent.
Perpetuity and modification are important points where classical waqf ideas and U.S. law intersect. In most U.S. states, the traditional “rule against perpetuities” is relaxed or does not apply to charitable trusts, which are allowed to be perpetual. That’s good news for waqf-like structures, because a charitable endowment for a mosque, school, or soup kitchen can legally last forever. However, U.S. courts retain power to modify charitable trusts under cy-près if the original purpose becomes impossible or impracticable (for instance, if a neighborhood depopulates). A carefully drafted “Islamic” waqf document in the U.S. will usually anticipate this and provide a Sharia-consistent pathway: e.g., if a funded Islamic school closes permanently, its endowment must be redirected to another Islamic educational cause in the same region. Family waqf, by contrast, are harder: if the primary benefit is for specific family members, the structure may no longer qualify as “charitable” under U.S. law, may not be eligible for 501(c)(3) status or charitable deductions, and may run into continued limits on perpetual private trusts depending on the state.
Tax and investment issues are another key dimension of how waqf works in the U.S. A properly structured charitable waqf-like entity (e.g., a 501(c)(3) organization) can receive tax-deductible donations, be exempt from federal income tax on most activities, and potentially avoid property tax on real estate used for religious or charitable purposes (subject to state law). However, any active business activity inside the entity may generate “unrelated business taxable income” (UBTI), triggering tax and regulatory scrutiny. From an Islamic perspective, many founders also want investments to be Sharīʿa-compliant: avoiding interest-bearing instruments, prohibited industries, and excessive uncertainty or speculation.
Practically, this means the U.S.-based waqf often adopts an investment policy that blends standard nonprofit best practices (diversification, risk management, spending rules) with Islamic screens and, sometimes, a preference for impact investments aligned with the waqf’s mission.
In practice, U.S. waqf-like initiatives face several challenges. One is translating religiously rooted terms (waqf, mutawallī, sharṭ al-wāqif, etc.) into legally enforceable English language provisions that judges and regulators understand. Another is continuity: ensuring that future generations of trustees respect the founder’s Sharīʿa-based restrictions even when the social or economic context has shifted significantly. There can also be tension between a founder’s desire for rigid inalienability (never sell, never change) and practical realities (neighborhoods change, buildings age, zoning shifts, disasters occur). U.S. law typically favors flexibility and solvency of charitable institutions, so overly rigid provisions may either be ignored in practice or modified by courts if they threaten the organization’s viability.
Diaspora diversity adds another layer. Muslim communities in the U.S. draw on multiple fiqh traditions (Hanafi, Shafiʿi, Maliki, Hanbali, Jaʿfari, etc.), each with nuanced views on issues like cash waqf, the exact conditions of irrevocability, or the permissibility of certain investments. A U.S.-based waqf might include founders and beneficiaries from different legal schools and ethnic backgrounds, making consensus on the “Islamic” features of the waqf deed more complex than in historically homogeneous societies. Many communities handle this by referencing broadly accepted principles (like the importance of preserving capital, avoiding ribā, and sustaining public benefit) and by forming advisory councils that can issue reasoned, documented guidance if novel questions arise.
From a strategic perspective, building effective waqf-like structures in the U.S. usually means combining Islamic jurisprudential insight with sophisticated nonprofit and trust law expertise. Founders typically work with both Sharīʿa scholars and U.S.-licensed attorneys to draft documents that are (a) enforceable under state and federal law, and (b) genuinely reflective of waqf principles rather than just branding. That includes carefully defining charitable purposes, identifying classes of beneficiaries, establishing transparent appointment and removal processes for trustees, specifying permissible investment policies, and writing fallback provisions for changed circumstances. Without this careful design, entities that call themselves “waqf” may, in practice, operate just like any other nonprofit, losing much of the distinctiveness that historically made awqāf powerful instruments of sustained social welfare.
Looking forward, there is growing interest in using waqf concepts to build durable Muslim community infrastructure in the United States: endowing mosques, Islamic schools, scholarship funds, social-service agencies, and even health clinics or housing initiatives. Some communities also explore hybrid models like donor-advised funds that are informally treated as waqf capital, or “social waqf” structures that support environmental projects, refugee relief, or local economic development. As these efforts mature, they are likely to produce more standardized “model waqf deeds” adapted to U.S. law, more trained Muslim nonprofit leaders who understand both Sharīʿa and IRS requirements, and perhaps even policy advocacy to clarify how Islamic endowments fit within the broader legal ecosystem of American philanthropy.
Finally, any person or community in the U.S. considering creating a waqf should treat it as a long-term legal and religious commitment. That means conducting feasibility studies, securing reliable revenue projections, training administrators, and building transparent governance with accountability to donors and beneficiaries. It also means recognizing that while the spirit of waqf is perpetuity and steadfastness, responsible stewardship in a changing environment may require carefully framed mechanisms for appropriate adaptation, always guided by the founder’s intent and the higher objectives of Sharīʿa (maqāṣid). In this way, the classical institution of waqf can be authentically reimagined within the U.S. legal framework, functioning as a bridge between Islamic philanthropic tradition and contemporary nonprofit practice.
