Disposal of Khums
1: Khums should be divided into two parts. One part is Sehme Sadaat, it should be given to a Sayyid who is poor, or orphan, or who has become stranded without money during his journey. The second part is Sehme Imam (A.S.), and during the present time it should be given to a Mujtahid, who fulfils all conditions, or be spent for such purposes as allowed by that Mujtahid. As an obligatory precaution, that Mujtahid must be Aalam, and well versed in public affairs.
2: An orphan Sayyid to whom Khums is given should be poor. But the Sayyid who has been stranded without money while on journey, can be helped with Khums even if he may not be a poor man in his own hometown.
3: If the journey of a Sayyid who has been stranded was with the purpose of committing a sin, as an obligatory precaution, he should not be given Khums.
4: Khums can be given to a Sayyid who may not be A'dil, but it should not be given to a Sayyid who is not Ithna 'Ashari.
5: Khums should not be given to a Sayyid if he is a transgressor, and Khums given to him encourages him further to commit the sins. And as a precaution, Khums should not be given to a Sayyid who is a drunkard, or does not offer his daily prayers, or commits sins openly, even if giving Khums to him may not aid him in committing sins.
6: If a person claims that he is a Sayyid, Khums cannot be given to him unless two just ('Adil) persons confirm that he is a Sayyid, or if he is so well-known among the people, (as Sayyid) that one is sure and satisfied about him being a Sayyid.
7: Khums can be given to a person who is known as Sayyid in his home city, if one is not certain or satisfied about anything to the contrary.
8: If the wife of a person is a Sayyidah, he should not, as an obligatory precaution, give Khums to her for meeting her own expenses. However, if it is obligatory on the wife to meet the expenses of others, and she cannot meet them, it is permissible to give Khums to her, so that she may meet their expenses. Similarly, one can not give Khums to her so that she may use it on her non-essential expenses.
9: If it is obligatory on a person to meet the expenses of a Sayyid or a Sayyidah, who may not be his wife, he cannot, on the basis of obligatory precaution, give him/her food, dress and other essential items of subsistence from Khums. However, there is no harm if he gives him/her a part of Khums to meet other necessary expenses.
10: If it is obligatory on a person to maintain a poor Sayyid, but he cannot meet his expenses, or can meet them but does not want to do so, Khums can be given to that Sayyid.
11: The obligatory precaution is that a needy Sayyid should not be given Khums in excess of his yearly expenses.
12: If a person is the creditor of a person who is entitled to receive Khums, and wants to adjust his debt against Khums payable by him, he should, as an obligatory precaution, either seek the permission of a Mujtahid to do so, or give Khums to the deserving person and thereafter, the deserving person returns it to him towards the debt. He can also take the Wakalat from deserving person, receive Khums on his behalf, and then deduct his debt from it.
These laws are according to Aayatullah Sistani's Fataawa.