דן לכף זכות How far do you have to go?

OPINIONS: OBLIGATORY OR OPTIONAL?

BREAKDOWN OF RAMBAM:
1. The righteous must be judged favorably even if the matter seems very likely negative.
2. Average individuals, who are careful not to sin but sometimes slip up, must be judged favorably if there is an equal chance of good or bad. Even if it is more likely that the negative interpretation is correct, it is still proper to leave the doubt unresolved in ones mind and not judge the other negatively.
3. Wicked individuals have lost their rights to a judging favorably, and they are not to be given the benefit of the doubt. Even when their actions appear positive, they should be viewed as negative.
4. Unknown individuals have an intermediate status. While there is no obligation to judge them favorably, it is a good quality for one to assume that such people have merit and give them the benefit of the doubt

חלק ראשון, ספר של בינונים, ל״ב (Tanya - Rabbi Shneur Zalman of Liadi)
In the previous chapters, the Alter Rebbe described how it is necessary for a person “to break his heart”, that is to experience an emotional crisis, to rid himself of all traces or arrogance in order for the G-dly Soul to subdue the Animal Soul.
Through the fulfillment of the things described above, when one looks upon his body as despicable and contemptible, his only happiness would be derived from the happiness of the Soul, and this is the straight and simple path to achieve the Mitzvah of “You shall love your neighbor as yourself” (Leviticus 19:18), that is you shall love every Soul from Israel, from the most eminent to the lowliest.
Who knows the greatness and elevation of his Soul in its Root and Source in the Living G-d, because he despises his material body? Also since all of the Souls are brethren with one Father for us all, therefore all of Israel are called true brothers based on the root of their Souls in the One G-d, only their bodies are separated (in terms of their physical attributes). Therefore, if they make their bodies their main focus, and their Souls subsidiary, it is impossible for there to be true love and brotherhood between them rather everything would be dependent on a physical entity. This is what Hillel the Elder meant when he said, referring to the Mitzvah “You shall love your neighbor as yourself”.
For the foundation and root of the entire Torah is the elevation of the Soul above the body until it reaches the Source and Root of all the worlds and to draw down the Blessed Eternal Light into the Knesset Israel, as it is written below, meaning that the Source of all the Souls of Israel is one entity and there is no separation, G-d forbid, among the Souls because G-d does not dwell in defective sites. As it is stated in the Amiddah “Bless all of us Our Father as one in the Light of Your Countenance” (as will be explained at length elsewhere)
As it is written in the Gemara, when one sees one’s fellow sin, one is commanded to hate him and tell his Rabbi to hate him. Here we are talking about a true friend who studies Torah and performs Mitzvot. And you have already fulfilled the Mitzvah “you shall not hate your kinsfolk in your heart. Reprove your kinsman but incur no guilt because of him.” (Leviticus 19:17) referring to the person who is equal to you in the study of Torah and fulfillment of Mitzvot but who has not repented from his sin as described in Sefer HaHaredim.
But if the person is not a close friend (or a person who does not study Torah, perform Mitzvot and grown distant from Judaism), here is what Hillel the Elder said: “Be of the disciples of Aaron, loving peace and pursuing peace, loving mankind and drawing them close to the Torah”. (Pirkei Avot 1:12), love all creatures and draw them close to the Torah -- that is to say even those who are furthest from G-d’s Torah and His Service. Therefore, these people are referred to as creatures in the world, and one must draw them with the thick cables of love and perhaps be able to bring them close to the Torah and Service to G-d.
If not (if the efforts to draw them close to the Torah are unsuccessful), one did not lose the reward of the Mitzvah to love one’s neighbor. Also, regarding close friends, if you rebuked them but yet they did not repent of their sins, though you are commanded to hate them, you are also commanded to love them, and both of these commandments are true: Hatred for the evil within them and love for the attribute of the good hidden within them which is the Divine spark within them which vitalizes their Divine Souls. This also awakens the quality of mercy within one’s Soul because mercy has the attribute of revelation (of the G-dly Soul) within the Evil of the Sitra Achra (“the other side” =the Animal Soul) which overcomes the G-dly Soul in Evil Doers. This mercy nullifies the hatred and awakens the love as is known from the passage “for Jacob who redeemed Abraham” (and King David only said “I feel a perfect hatred toward them; I count them my enemies” (Psalm 139:22) when referring to the heretics and apostates who have no part in the G-d of Israel –beginning of Chapter 16, Masechet Shabbat)
Comment: “For Jacob who redeemed Abraham” Jacob represents compassion and Abraham love. But the exact meaning of the phrase Jacob who redeemed Abraham is not clear to me.
Summary: The Elter Rebbe is saying that we must recognize that each person has a G-dly Soul which is hewn from the same Supernal Source and that in the process of Histalshalut (the descent through the various spiritual levels of an infinite number of worlds to our own world, the G-dly Soul is invested with layers of materialism to a greater or lesser extent in each individual person. Although the Animal drive toward material pleasures may predominate in certain people, they are still worthy of love and compassion.