Dana (Samskrit : दानम्) is the tradition of 'giving away' or 'donation' without expecting any return' is practiced widely in the world as 'philanthropy', largely been driven by traditional faith-based motivation while the practice of purpose-based or secular giving is slowly gaining ground in the present day society. Traditionally the act of 'giving' involves a complex and variegated thought process of people who 'gave' in many forms (water, food, money) following rituals (shraddha, yajnas), themes (annadana, vratas, digging of wells for public welfare), ways (गुप्तदानम् । gupta dana : unknown to anyone, or visible to everyone), times (kartika masa) and methods (scriptural procedures).
- 1 व्युत्पत्तिः ॥ Etymology
- 2 Origin of Practice of Dana
- 3 दानलक्षणानि ॥ Characteristics of Dana
- 4 दानाङ्गानि ॥ Elements of Dana
- 5 दानतत्त्वम् ॥ Essence of Dana
- 6 Right Disposition
- 7 Right Premises
- 8 Limits of Dana
- 9 Types of Dana
- 10 दानपद्धतिः ॥ Procedure of Dana
- 11 Dana Associated Terminology
- 12 निष्फलदानम् ॥ Fruitless Dana
- 13 References
व्युत्पत्तिः ॥ Etymology
The word Dana is derived from the dhatu 'दा' दाने with the following synonyms given in Nighantu meaning 'giving' 'distribution' 'bestowing' ' presentation' 'generous' etc.
दाति दाशति दासति राति रासति पृणक्षि पृणाति शिक्षति तुञ्जत मंहते इति [ दश ] दानकर्माणः। २० । (Nighantu 3.20) 
dāti dāśati dāsati rāti rāsati pr̥ṇakṣi pr̥ṇāti śikṣati tuñjata maṁhatē iti [ daśa ] dānakarmāṇaḥ। 20 । (Nighantu 3.20)
Amarakosa defines Dana as the dravya (material) given away to devatas, brahmanas and others and is summarized as : Tyaga (त्यागः । giving up), Vihapitam (विहापितम् a gift) Utsarjana (उत्सर्गः donation), Visarjana (विसर्जनम् giving away) Visrananam (विश्राणनम् donation) Vitarana (वितरणम् giving up), Sparshana (स्पर्शनम् a gift)
देवब्राह्मणादिसम्प्रदानकद्रव्यमोचनम् . तत्पर्य्यायः . त्यागः २ विहापितम् ३ उत्सर्जनम् ४ विसर्जनम् ५ विश्राणनम् ६ वितरणम् ७ स्पर्शनम् ८ प्रतिपादनम् ९ प्रादेशनम् १०निर्व्वपणम् ११ अपवर्जनम् १२ अंहतिः इत्यमरः
dēvabrāhmaṇādisampradānakadravyamōcanam . tatparyyāyaḥ . tyāgaḥ 2 vihāpitam 3 utsarjanam 4 visarjanam 5 viśrāṇanam 6 vitaraṇam 7 sparśanam 8 pratipādanam 9 prādēśanam 10nirvvapaṇam 11 apavarjanam 12 aṁhatiḥ ityamaraḥ
Origin of Practice of Dana
The practice of 'giving', as we see dates back to the days of Rigveda. Gifts of various kinds and donors have been highly eulogised in the Rigveda. There are 'danastutis' in many Rigveda mantras.Example : In suktas 1.125 and 1.126 the gifts made by king Svanaya to Kakshivat are praised and dana in general is eulogised.
नाकस्य पृष्ठे अधि तिष्ठति श्रितो यः पृणाति स ह देवेषु गच्छति । तस्मा आपो घृतमर्षन्ति सिन्धवस्तस्मा इयं दक्षिणा पिन्वते सदा ॥५॥ (Rig. Veda. 1.125.5)
nākasya pṛṣṭhe adhi tiṣṭhati śrito yaḥ pṛṇāti sa ha deveṣu gacchati । tasmā āpo ghṛtamarṣanti sindhavastasmā iyaṃ dakṣiṇā pinvate sadā ॥5॥ (Rig. Veda. 1.125.5)
Meaning: He who supports those who are dependent on him by liberally giving them money (wealth) and food enjoys all heavenly happiness. He attains the heavenly worlds and becomes one among the devatas. The streams of water flow widely to provide him the life sustaining water and the earth provides him with abundance of food etc. The subject of dana is of utmost importance in the present yuga as mentioned by Manu while propounding the kaliyuga dharmas in Manusmriti. Manu and others (Parashara Smriti) state that in the four yugas namely Krita (कृत), Treta (त्रेता), Dvapara (द्वापर) and Kali (कलि), the principal aspects of religious life were respectively Tapas (तपः), metaphysical knowledge (ज्ञानं ), sacrifices (यज्ञं) and danam (दानम्)
तपः परं कृतयुगे त्रेतायां ज्ञानं उच्यते । द्वापरे यज्ञं एवाहुर्दानं एकं कलौ युगे ॥ १.८६ ॥ (Manu. Smri. 1.86)
tapaḥ paraṃ kṛtayuge tretāyāṃ jñānaṃ ucyate । dvāpare yajñaṃ evāhurdānaṃ ekaṃ kalau yuge ॥ 1.86 ॥ (Manu. Smri. 1.86)
Similar idea is also mentioned in Mahabharata. In Shanti Parva it is explained that the dharma of people varies from one age to another: tapasya is best in Sat Yuga, Gnana in Treta Yuga, and Yajna in Dwapar Yug. In Kali Yuga, dana alone is best practice for people.
दानलक्षणानि ॥ Characteristics of Dana
Traditional literature on dana is very large and varied, abounding with many nuances, and shades of opinion. Therefore, only a very simplistic presentation is given here. Dana by principle carries the following four important features
- For Your Own Sake : Dana is not given for the benefit of the recipient. Any benefit which the recipient may derive is secondary. It is fundamentally given for one's own benefit. This is based on the basic concept that the world is a binding factor, and wealth is one of the anchors that binds us to this earth (in cycles of birth and death). Therefore, practice of tyaga or 'sacrifice' or 'giving up' one's wealth helps corrode this anchor.
- A Suitable Recipient : His/her connection with a dana must end when they part with the property. They are mostly not concerned with how the item is eventually utilised. However, at the time of identifying the recipient, they must find a suitable candidate, patra (पात्रः). It is generally recognised that while most dana is directed towards Brahmins dana to non-Brahmins is not prohibited or insignificant. This is broadly in line with the pauranik directives. However, there are three important caveats:
- Only dana is generally directed towards Brahmins. Utsarg is for the benefit of the community as a whole.
- There is a clear preference for learned or yajnakarta Brahmins. There are also strong prohibitions against giving to a Brahmin who is Brahmin only by birth, and is neither learned nor cultured. Giving to an incapable Brahmin will result in both the donor and the recipient sinking.
- At several places, the Puranas advise Kshatriyas (क्षत्रियः) and Vaishyas (वैश्यः) not to accept dana. However, Agni Purana (अग्निपुराणम्) clearly says that you get punya by giving to non-Brahmins, including Shudra (शूद्रः) and Varna-sankar (वर्णसंकरः). It also specifies the proportion of benefit depending on the recipient.
- Giving Respectfully : Puranas emphasise that the punya of a dana is lost if the donation is made with disrespect or made regretfully. Such a dana may be classified as tamasik. Therefore, the donor should welcome the recipient, and offer the dana with respect. The recipient should also be given dakshina, possibly to defray the expenses / time spent in participating in the dana ritual. This protects the value of the main dana, so far as the donor is concerned. Dana for attaining prestige or fame in society is of the lowest kind,
- Irreversible : If a sankalpa (संकल्पम्) has been made, and the intended recipient does not show up to accept the donation, the donor is required to release the item in a pond or a river. The donated item cannot revert to the donor or be reallocated to another person.
दानाङ्गानि ॥ Elements of Dana
The literature on dana is of enormous extent.
Defining Dana, Shri. Sanjay Agarwal says dana is a sub-set of giving. It is only the last item - 'giving - as per scriptural directions' that qualifies as proper dana. According to his findings the most comprehensive definition of Dana appears to have seven essential elements:
- Donor (दाता)
- Acceptor (प्रतिग्रहीता) or Patra (पात्रः)
- Respectful Transaction or Right Disposition (श्रद्धा)
- Appropriate object for donation, Danavastu (देयम्)
- Right premises, Dana Pradesha (दानप्रदेशः)
- Right time, Dana Kala Nirnaya (दानकालनिर्णयः)
- Right procedure (शास्त्रविधिः)
दानतत्त्वम् ॥ Essence of Dana
The story of King Dharmvarma is narrated in the Skand Purana. The King was curious about the essential elements of dana. He therefore performed penance for a long time. At the end, he was rewarded with a puzzling shloka:
स तु दानस्य तत्त्वार्थी तेपे वर्षगणान्बहून्॥ ४.१६ ॥ sa tu dānasya tattvārthī tēpē varṣagaṇānbahūn॥ 4.16 ॥
ततस्तं प्राह खे वाणी श्लोकमेकं नृप श्रृणु॥ द्विहेतु षडधिष्ठानं षडंगं च द्विपाकयुक्॥ ४.१७ ॥ चतुःप्रकारं त्रिविधं त्रिनाशं दानमुच्यते॥ (Skan. Pura. Mahe. Khan. 4.16 - 17) 
tatastaṁ prāha khē vāṇī ślōkamēkaṁ nr̥pa śrr̥ṇu॥ dvihētu ṣaḍadhiṣṭhānaṁ ṣaḍaṁgaṁ ca dvipākayuk॥ 4.17 ॥ catuḥprakāraṁ trividhaṁ trināśaṁ dānamucyatē॥
Meaning : ‘Dana has two hetu, six adhishthan, six ang, two paak, four prakar, three vidh and three ways of naash.
द्विहेतु ॥ Two Enhancers
The two hetus (drivers, push factors) of dana, which help increase or decrease it, are shraddha (श्रद्धा) and shakti (शक्ति).
श्रद्धा शक्तिश्च दानानां वृद्ध्यक्षयकरेहि ते॥ ४.४१ ॥ śraddhā śaktiśca dānānāṁ vr̥ddhyakṣayakarēhi tē॥ 4.41 ॥ (Skan. Pura. Mahe. Khan. 4.41)
1. If you give away your entire property without shraddha, you will not get any benefit. However, if you give even a little of your justly earned money, you will be able to please Shri Shiv, provided you give with shraddha.
2. The second hetu is shakti (capacity). You should only give out of what is left after meeting needs of the family. If money is given to a rich and capable person, while the family is living in penury, then all benefit is lost. This causes dharma to transform into adharma. Similarly, if someone performs shradha for a dead person, while the living dependents suffer, then this will result in misery for the donor in this life and thereafter.
षडधिष्ठानानि ॥ Six Motives
The six adhisthanas (base, pedestal, foundation) of dana are dharma, artha, kama, lajja, harsha and bhaya.
धर्ममर्थं च कामं च व्रीडाहर्षभयानि च॥ अधिष्ठानानि दानानां षडेतानि प्रचक्षते॥ ४.५५ ॥ (Skan. Pura. Mahe. Khan. 4.55) 
dharmamarthaṁ ca kāmaṁ ca vrīḍāharṣabhayāni ca॥ adhiṣṭhānāni dānānāṁ ṣaḍētāni pracakṣatē॥ 4.55 ॥
1. When dana is made to a suitable person, without any objective, and only out of a sense of duty, it is known as dharma dana (धर्मदानम्).
2. When dana is made with an objective in mind, it is known as artha dana (अर्थदानम्).
3. When dana is given during drinking, gambling, womanizing, hunting etc., it is known as kaama dana (कामदानम्).
4. When dana is given out of embarrassment on being accosted by seekers in public, it is known as lajja dana (लज्जादानम्).
5. When dana is made out of joy on hearing good news or on successful completion of a desired project, it is known as harsha dana (हर्षदानम्).
6. When dana is given out of fear to avoid infamy, damage, violence, etc., it is known as bhaya dana (भयदानम्).
षडङ्गानि ॥ Six Components
Donors should be Dharmatmas or the virtuous by nature and their inherent nature is to give willingly and happily. They should be devoid of vyasanas (bad habits), be the symbols of purity, and anindaneeya (blemishless) in character. A donor who is ill-mannered, evil-minded, having many vyasanas, disrespectful towards the acceptor, and one who donates with some evil intentions or for fulfilling his means is an Adhama.
दाता प्रतिग्रहीता च शुद्धिर्देयं च धर्मयुक्॥ ४.६२ ॥ देशकालौ च दानानामंगान्येतानि षड्विदुः॥ ४.६३ ॥ (Skan. Pura. Mahe. Khan. 4.62 and 63) 
dātā pratigrahītā ca śuddhirdēyaṁ ca dharmayuk॥ 4.62 ॥ dēśakālau ca dānānāmaṁgānyētāni ṣaḍviduḥ॥ 4.63 ॥
According to Hemadri, these six angas (constituent elements) of dana have been cited by Devala also.The six components of dana are donor (दाता), Acceptor (प्रतिग्रहीता), purification (शुद्धिः), legitimate/appropriate object for donating (धर्मयुक्), place (देशः), and time (कालः).
1. Donor should be healthy, virtuous, desirous of giving, devoid of any addiction, holy, and earning a legitimate living.
2. Accepter should have good lineage, learning, character, kindness and control of senses. He should make his living in approved ways.
3. Dana is purified if the donor welcomes the seekers, has genuine affection for them, honours them, and does not find fault in them.
4. Only that money which has been earned with ones’s own effort (but without excessive hardship), and has not been obtained by harassing others is eligible for dana. It does not matter whether such money is less or more.
5. That which is difficult to obtain in a place (e.g. water in a desert), is the right item for donating in that place.
6. That which is difficult to obtain at a particular time (e.g. food during famine, or lamp-light at night), is the right item for donating at that time.
According to the shastras, brahmana dharma entails that it is the dharma of a person of Brahmana varna to be a Dana pratigrhita (दानप्रतिग्रहीता)
यजनं याजनं चैव तथा दानप्रतिग्रहौ। अध्यापनं चाध्ययनं षट्कर्मा धर्मभाग्द्विजः॥ 13-141-67 (Maha. Anush. 13.141.67)
Mahabharata in the context of describing the six dharmas of a brahmana (dvija) clarifies that - performing yajnas (यजनं), directing others in performing yajnas (याजनं), accepting danas (दानप्रतिग्रहीता), teaching vedas (अध्यापनं), self study (अध्ययनं) of vedas are the six karmas and dharmas of brahmana dvijas.
Kshatriya dharma included five duties - study of vedas, performing yajnas, giving dana (a donor), protecting citizens and punishing the guilty. Vaishya dharma included - study of vedas, performing yajnas, giving danas (a donor), protecting cows and engaging in agriculture, trade. Shudra dharmas included working in agriculture and services like carpentry, sculpture, dance, etc. One may note that brahmana varna are traditionally acceptors while kshatriya and vaishya varnas are the donors to both brahmanas and shudras.
द्विपाकौ ॥Two Results
सद्भ्यो यद्दीयते किंचित्तत्परत्रोपतिष्ठति॥ असत्सु दीयते किंचित्तद्दानमिह भुज्यते॥ ४.७१ ॥ (Skan. Pura. Mahe. Khan. 4.71) 
sadbhyō yaddīyatē kiṁcittatparatrōpatiṣṭhati॥ asatsu dīyatē kiṁcittaddānamiha bhujyatē॥ 4.71 ॥
Dana has two kinds of rewards: those which are enjoyed in heaven, and others which are enjoyed in this world itself. Rewards of dana made to a true or noble person are enjoyed in heaven. Rewards of dana made to others are enjoyed on Earth itself.
चतुःप्रकारम् ॥ Four Kinds of Dana
ध्रुवमाहुस्त्रिकं काम्यं नैमित्तिकमिति क्रमात्॥ ४.७२ ॥ वैदिको दानमार्गोऽयं चतुर्धा वर्ण्यते द्विजैः॥ (Skan. Pura. Mahe. Khan. 4.72)
dhruvamāhustrikaṁ kāmyaṁ naimittikamiti kramāt॥ 4.72 ॥ vaidikō dānamārgō'yaṁ caturdhā varṇyatē dvijaiḥ॥
1. Works of public welfare, such as digging of wells and ponds, planting orchards and gardens, etc. are known as dhruva (ध्रुवम्) or eternal.
2. Whatever is given on a daily basis is known as nitya (नित्य) or trika (त्रिकम्), example Vidyadana.
3. That which is given with a desire for offspring, victory, splendour, woman, power, or for fulfilling one’s wishes, is known as kamya (काम्य).
4. Naimittika (नैमित्तिकम् motivated) dana is of three types:
- Kaalapeksha (कालापेक्ष) - that which is motivated by auspicious times or other planetary conjunctions. Ex: Grahana (eclipses), Sankranti times (monthly transition of sun in a rashi) auspicious times such as weddings and some festivals.
- Kriyapeksha (क्रियापेक्ष) - that which is motivated by an occasion or activity such as shraddh (श्राद्ध), vratas (vows) etc.
- Gunapeksha (गुणापेक्ष) - that which is motivated by the recipient's character, knowledge, learning or other virtues, example vidyadana.
त्रिविधद्रव्यदानम् ॥Three Ways based on Dana Items
त्रैविध्यमभिधीयते॥ ४.७६ ॥ traividhyamabhidhīyatē॥ 4.76 ॥
अष्टोत्तमानि चत्वारि मध्यमानि विधानतः॥ कानीयसानि शेषाणि त्रिविधत्वमिदं विदुः॥ ४.७७ ॥
aṣṭōttamāni catvāri madhyamāni vidhānataḥ॥ kānīyasāni śēṣāṇi trividhatvamidaṁ viduḥ॥ 4.77 ॥
गृहप्रासादविद्याभूगोकूपप्राणहाटकम्॥ एतान्युत्तमदानानि उत्तमद्रव्यदानतः॥ ४.७८ ॥
gr̥haprāsādavidyābhūgōkūpaprāṇahāṭakam॥ ētānyuttamadānāni uttamadravyadānataḥ॥ 4.78 ॥
अन्नारामं च वासांसि हयप्रभृतिवाहनम्॥ दानानि मध्यमानीति मध्यमद्रव्यदानतः॥ ४.७९ ॥
annārāmaṁ ca vāsāṁsi hayaprabhr̥tivāhanam॥ dānāni madhyamānīti madhyamadravyadānataḥ॥ 4.79 ॥
उपानच्छत्रपात्रादिदधिमध्वासनानि च॥ ४.८० ॥ upānacchatrapātrādidadhimadhvāsanāni ca॥ 4.80 ॥
दीपकाष्ठोपलादीनि चरमं बहुवार्षिकम्॥ इति कानीयसान्याहुर्दाननाशत्रयं श्रृणु॥ ४.८१ ॥
dīpakāṣṭhōpalādīni caramaṁ bahuvārṣikam॥ iti kānīyasānyāhurdānanāśatrayaṁ śrr̥ṇu॥ 4.81 ॥ (Skan. Pura. Mahe. Khan. 4.76 - 81) 
The following table summarizes the kinds of items for donation and their level of importance in giving
दाननाशास्त्रयम् ॥ Three Dana Nashakas
यद्दत्त्वा तप्यते पश्चादासुरं तद्धृथा मतम्॥ अश्रद्धया यद्ददाति राक्षसं स्याद्वृथैव तत्॥ ४.८२ ॥
yaddattvā tapyatē paścādāsuraṁ taddhr̥thā matam॥ aśraddhayā yaddadāti rākṣasaṁ syādvr̥thaiva tat॥ 4.82 ॥
यच्चाक्रुश्य ददात्यंग दत्त्वा वाक्रोशति द्विजम्॥ पैशाचं तद्वृथा दानंदाननाशास्त्रयस्त्वमी॥ ४.८३ ॥ (Skan. Pura. Mahe. Khan. 4.82 - 83) 
yaccākruśya dadātyaṁga dattvā vākrōśati dvijam॥ paiśācaṁ tadvr̥thā dānaṁdānanāśāstrayastvamī॥ 4.83 ॥
Dana is nullified by three factors: regret, unsuitability of recipient, and ashraddha (अश्रद्धा).
- Further, if the donor regrets making the dana, then it is known as Asura dana (असुरदानम्).
- If the dana is given without shraddha, it is known as Rakshasa dana (राक्षसदानम्).
- When the receiver is scolded or told unpleasant things or is cursed afterwards, then the dana is known as Pishacha dana (पैशाचकदानम्).
Hearing this crystal clear explanation of the cryptic shloka, the King was overjoyed. Devarshi Narada then left the money in the King's care and proceeded on his business.
The qualities of a respectable transaction mentioned as Shraddha (श्रद्धा) are outlined in this section. In the Taittiriya Upanisad, the Guru imparts the student to be charitable. It mentions various conditions of charity:
ये के चास्मच्छ्रेयाँसो ब्राह्मणाः तेषां त्वयाऽऽसनेन प्रश्वसितव्यम् । श्रद्धया देयम् । अश्रद्धयाऽदेयम् । श्रिया देयम् । ह्रिया देयम् । भिया देयम् । संविदा देयम् । अथ यदि ते कर्मविचिकित्सा वा वृत्तविचिकित्सा वा स्यात् ॥ ३ ॥
ye ke cāsmacchreyām̐so brāhmaṇāḥ teṣāṁ tvayā''sanena praśvasitavyam । śraddhayā deyam । aśraddhayā'deyam । śriyā deyam । hriyā deyam । bhiyā deyam । saṁvidā deyam । atha yadi te karmavicikitsā vā vr̥ttavicikitsā vā syāt ॥ 3 ॥
- Give with respect/honour (Sraddha deyam)
- Don’t give with disrespect/dishonour
- Give according to one’s prosperity/capacity
- Give with modesty
- Give with awe and respect
- Give with fellow-feeling and friendly attitude
In the Mahabharata, story of Shibi Chakravarti is narrated wherein he explained that he does not give dana for prestige or gain. He gives dana only because it is the righteous path of dharma, on which the best have always walked.
The places (देशः) where gifts are to be made are also specified in the Smritis, Puranas and digests. Danamayukha specifies that Dana given at home yields ten times as much merit (as when made elsewhere), a hundred times when made in a goshala (cowpen), thousand times when made in sacred places (tirthas) and an infinite number of times when made in the premises of Shivalinga (such as Shiva temples).
गृहे दशगुणं दानं गोष्ठे चैव शताधिकम् । पुण्यतीर्थेषु साहस्रमनन्तं शिवसन्निधौ ॥
gr̥he daśaguṇaṁ dānaṁ goṣṭhe caiva śatādhikam । puṇyatīrtheṣu sāhasramanantaṁ śivasannidhau ॥
Apart from these places holy places or tirthas, temples, riversides, oceans and important forest areas are also very sacred places to offer dana.
- Devipurana states that all abodes of Shiva and all rivers are sacred places to perform dana.
देवीपुराणे सर्वे शिवाश्रमाः पुण्याः सर्वा नद्यः शुभप्रदाः । devīpurāṇe sarve śivāśramāḥ puṇyāḥ sarvā nadyaḥ śubhapradāḥ ।
- According to Yajnavalkya smriti quoted by Hemadri that is a good place (सर्वपुण्यतमो देशः) to donate where dharma is followed by all brahmins.
न हीयते यत्र धर्म्मश्चतुष्पात् सकलो द्विज! । स देशः परमो नित्यं सर्वपुण्यतमो मतः । na hīyate yatra dharmmaścatuṣpāt sakalo dvija! । sa deśaḥ paramo nityaṁ sarvapuṇyatamo mataḥ ।
- Charities made on the banks of great rivers have always been lauded to bestow infinite rewards. This aspect has found many references in puranas and smritis. According to Vyasa smriti referred in Vachaspatyam
गङ्गा-द्वारे प्रयागे च अविमुक्ते च पुष्करे । नगरे चाट्टहासे च गङ्गासागरसङ्गमे । कुरुक्षेत्रे गयायाञ्च तीर्थे वाऽमरकण्टके । एवमादिषु तीर्थेषु दत्तमक्षयतामियात् । सर्वतीर्थमयी गङ्गा तत्र दत्तं महाफलम् ।
Banks of Ganga river, Prayaga, Pushkara, place where Ganga joins the sea, Kurukshetra, Gaya, Amarakantaka tirthas are places where immense rewards are bestowed when danas are made, especially Ganga river which is equal to all tirthas.
- Skanda Purana adds to the above list including Varanasi, Kurukshetra, Naimisharanya, Sriparvata, Mahakala at Ujjain, Gokarna, Veda-parvata - these and the like are declared to be holy places, the habitations of cows, siddhas, and rishis are holy and whatever is donated in these sacred places confers infinite rewards.
Limits of Dana
Dana should only be made from money left over after fulfilling the requirements of the family as mentioned in Kurma Purana and Padma Purana.
कुटुम्बभक्तवसनाद् देयं यदतिरिच्यते । अन्यथा दीयते यद्धि न तद् दानं फलप्रदम् ॥ २६.१० (Kurm. Pura. Uttar. 26.10)
Dana should be given of what is left over after distribution for the family needs, when given otherwise, that dana will be fruitless.
न तद्दानं प्रशंसन्ति येन वृत्तिर्विपद्यते । दानं यज्ञस्तपः कर्म लोके वृत्तिमतो यतः ॥ ३६ ॥ (Bhag. Pura. 8.19.36)
Dana should not result in hardship to the donor’s dependents or loss of livelihood. That would take away all the punya.
However, there is an alternative view (Shukraneeti, 2.177), which suggests that giving away all (without holding back anything for one’s family) is an attribute of being Danasheela. There are also several stories where a person gives away all (like Raja Harishchandra sells off his wife and son to keep his word) or causes grief to family by giving a dear one’s life (like Shibi Chakravarti who gives away his own life to save a dove).
In general, only those who have surplus wealth are required to give. However, in the story of Annadana by Unchavrttibrahmana, the brahmana's son says that those brahmanas who by tapas have gained victory over krodha (anger) and the senses and who have the ability to give away what they have wholeheartedly can find the door to svargaloka.
ब्रह्मणास्तपसा युक्ता यथाशक्ति प्रदायिनः । सहस्रशक्तिश्च शतं शतशक्तिर्दशापि च ॥ (Maha. Asva. 90.96)
दद्याद्पश्च यः शक्त्या सर्वे तुल्यफलाः स्मृताः । रन्तिदेवो हि नृपतिरपः प्रादादकिञ्चनः ॥ (Maha. Asva. 90.97)
If a person has the capacity to give a thousand, and gives a hundred out of that; another who can give 100, but gives 10; and a third who has nothing, but gives just water, then each of these three will get the same punya. It is said that Raja Rantideva, even when bereft of everything, with a pure heart offered water (jaladana) and attained svargaloka.
Scriptures lay down varying proportions of one's income (ranging from 10-40%) to be given away in dana. By and large, these proportions are no longer followed in practice. Nevertheless, they offer an interesting perspective on traditional dana practices.
Skanda Purana : According to Skanda Purana, one should use 10% of one's justly earned income on good deeds or works of public benefit. (Mahe. Kand. 12.32).
Bhagavata Purana : At one stage, when Shukracharya advises Bali Chakravarti against giving all of his wealth away, he quotes learned people to recommend dividing one’s funds (वित्तं) into five equal parts.
धर्माय यशसेऽर्थाय कामाय स्वजनाय च । पञ्चधा विभजन् वित्तं इहामुत्र च मोदते ॥ ३७ ॥ (Bhag. Pura. 8.19.37)
One part should be used for धर्मः (daan etc.), second for यशः (public works, which bring fame to oneself), third should be reinvested to generate more wealth, fourth for कामः (enjoyment of material things), and fifth for one’s family and friends.
If one were to follow the above prescription, then one would end up spending about 40% of funds on others: 20% as dana and another 20% on works for public-benefit, such as step-wells, temples, water-tanks, gardens, etc.
Types of Dana
Dana has been classified in several overlapping ways, depending on one's perspective: 
A simple definition of each kind of Dana is as follows:
Based on Orientation
Ishtapurta (इष्टापूर्त) is a word of high antiquity that deserves consideration in the subject of dana. It occurs in the Rigveda and the sense seems to be 'the cumulative adhyatmik result of merit due to a man's performance of sacrifices and charitable acts'. The word though employed in the singular consists of two parts, ishta (what is sacrificed) and purta (what is filled).
- Ishta (इष्टा) : Acts which are primarily religious in nature (yajna, homa, tapas, atithi satkar etc) and are turned inwards, are called Ishta. The rewards of such acts are invisible in this life and will be enjoyed in heavens.
- Purta (पूर्त) : Acts which are primarily charitable in nature (construction of public utilities, ponds, schools, rest houses, gardens, annakshetra, etc.) are called purta. The benefits of purta are visible in this life and include attainment of moksha. Charitable trusts are called purta works in texts.
Based on Beneficiary
- Dana (दानम्) : When the giving results in transfer of property from one person to another, it is treated as dana. In some cases, the transfer might benefit more than one person. However, so long as the number of beneficiaries is fixed, the giving will be considered dana. Additionally, the donor should no longer derive any benefit from the item donated. Some types of giving are not considered dana. These include gifts to people whom one is otherwise required to support. Similarly, mutual exchange of gifts is treated as a cultural practice, but does not qualify as dana. This article covers many aspects of Dana.
- Utsarga (उत्सर्गः) : If the item or property is dedicated or released for general public use, the giving is treated as Utsarga (उत्सर्गः). The property is then owned commonly, and is similar to the concept of common grazing land. In this case, there is no bar on the donor also using the property as a member of the public, without any special privileges. Utsarga includes planting of trees, digging of ponds and wells, setting up of rest houses, schools, etc.
Based on the Nature of Dana
According to Shrimad Bhagvad Gita, all dana can be classified into three categories: sattvika (associated with purity and adhyatmikity), rajasika (associated with materialism and worldly affairs) and tamasika (associated with lack of intellect and leads to darkness). Shraddha or the right disposition is also defined in Skanda Purana as follows
त्रिविधा भवति श्रद्धा देहिनां सा स्वभावजा॥ सात्त्विकी राजसी चैव तामसी चेति तां श्रृणु॥ ४.४६ ॥ (Skan. Pura. Mahe. Khan. 4.46)
trividhā bhavati śraddhā dehināṃ sā svabhāvajā॥ sāttvikī rājasī caiva tāmasī ceti tāṃ śrṛṇu॥ 4.46 ॥
- Sattvika Dana (सात्त्विकदानम्) : Sattvik dana is one that is made as a duty. It should be made after considering the time, place and the suitability of the receiver. The receiver should not perform any service or provide any benefit in return (अनुपकारी Anupkar). Swami Ramsukhdas explains that this kind of dana is really tyaga, relinquishment, in which nothing is desired in return. This type of dana is not the kind that gives punya (पुण्यम्), merit in return. Seeking such punya will transform the dana into rajasik (राजसिकदानम्). The Bhagavad Gita expounds the satvika dana as follows:
दातव्यमिति यद्दानं दीयतेऽनुपकारिणे । देशे काले च पात्रे च तद्दानं सात्विकं स्मृतम् ॥ (भ.गी.१७.२०)
dātavyamiti yaddānaṃ dīyate'nupakāriṇe । deśe kāle ca pātre ca taddānaṃ sātvikaṃ smṛtam ॥ (Bhag. Gita.17.20)
- Rajasika (राजसिकदानम्) : Rajasika dana is made for getting some direct or indirect benefit (whether material or adhyatmik) in return. The parting (of property) causes pain or regret to the donor. Or the dana is given after some persuasion (as in a collection or chanda - चंदा). Rajasika dana gives whatever benefits are sought by the donor. According to the Bhagavad Geeta,
यत्तु प्रत्युपकारार्थं फलमुद्दिश्य वा पुनः । दीयते च परिक्लिष्टं तद्दानं राजसं स्मृतम् ॥ (भ.गी.१७.२१)
yattu pratyupakārārthaṃ phalamuddiśya vā punaḥ । dīyate ca parikliṣṭaṃ taddānaṃ rājasaṃ smṛtam ॥ (Bhag. Gita.17.21)
- Tamasika (तामसिकदानम्) : When dana is made to an unsuitable person or without considering time or place, then it is called tamasika dana. If the dana is made without showing proper respect or in an insulting manner, then also it becomes tamasika. Another example of a tamasika dana would be where it is intended to cause bodily harm to another. In such a case, both the donor and the recipient are to be punished as for theft. The Bhagavad Gita says,
अदेशकाले यद्दानमपात्रेभ्यश्च दीयते । असत्कृतमवज्ञातं तत्तामसमुदाहृतम् ॥ (भ.गी.१७.२२)
adeśakāle yaddānamapātrebhyaśca dīyate । asatkṛtamavajñātaṃ tattāmasamudāhṛtam ॥ (Bhag. Gita.17.22)
Based on the Purpose served
Based on the purpose of dana as mentioned in several puranas, the classification is as given below:
दानं त्रिविधमित्येतत्कनिष्ठज्येष्ठमध्यमम् ॥ तत्र नैश्रेयसं ज्येष्ठं कनिष्ठं स्वार्थसिद्धये ॥ ३२.५५ ॥ कारुण्यात्सर्वभूतेषु संविभागस्तु मध्यमः ॥ (Brahmand. Pura. 1.32.55-56)
dānaṁ trividhamityētatkaniṣṭhajyēṣṭhamadhyamam ॥ tatra naiśrēyasaṁ jyēṣṭhaṁ kaniṣṭhaṁ svārthasiddhayē ॥ 32.55 ॥ kāruṇyātsarvabhūtēṣu saṁvibhāgastu madhyamaḥ ॥
- Jyestha (ज्येष्ठः) : Dana given in order to achieve moksh (nishreyas) is considered the most valuable form.
- Madhyama (मध्यमम्) : Dana given out of pity or kindness for others or for one's own kith and kin is considered to be of medium value. It is also called as Daya Dana (दयादानम्)
- Kanishtha (कनिष्ठः) : Dana given to achieve one’s own selfish ends is known as the least valued of all.
Based on the Objective for giving
Based the objective of making a dana, it is classified into four categories:
नित्यं नैमित्तिकं काम्यं त्रिविधं दानमुच्यते । चतुर्थं विमलं प्रोक्तं सर्वदानोत्तमोत्तमम् ॥ २६.४ (Kurm. Pura. Uttar. 26.4) 
nityaṁ naimittikaṁ kāmyaṁ trividhaṁ dānamucyatē । caturthaṁ vimalaṁ prōktaṁ sarvadānōttamōttamam ॥ 26.4
- Nitya (नित्यम्) : When dana is made daily to Brahmins without any expectation of services or return, it is known as nitya dana. The benefits of such dana are eternal.
- Naimittika (नैमित्तिकम्) : When dana is made to learned people at a particular time to counter the effects of sins, it is known as naimittika.
- Kamya (काम्यम्) : When a person desirous of children, victory, wealth, heaven etc, makes a dana, it is known as kamya.
- Vimala (विमलम्) : When dana is made out of a sense of duty, to Brahmins learned in the Veda, in order to please the divine, it is known as vimal or nirmal dana.
दानपद्धतिः ॥ Procedure of Dana
A distinguishing feature of traditional dana is the elaborate rituals and ceremonies that do with making a dana, making it more of an event rather than a simple transfer of resources. The pauranic method of dana leaves a lasting impression on the donor's mind as well as the community. This automatically serves to record the donation, as also encourage others to follow suit. However, Goswami Tulsidas offers a different view in the Ramcharitmanas. He adds that in Kali Yuga, the method of making a dana is not so important, rather Tyagabuddhi or relinquishment is more important.
Nevertheless, the formal act of dana starts with a sankalpa, making a resolution. While there are many procedures to be followed for making a dana on different occasions the general procedure is outlined as follows: (see footnote 2016 on Page 855 of Reference  and Page 506 of Reference )
- The donor and acceptor (usually a brahmin) should have taken their bath and wear two white garments (dhoti and angavastra).
- Donor should have performed his nityakarma including sandhyavandana (and agnikarya), should wear a pavitra, perform achamana, wear the sacred thread in upavita form, be seated on appropriate seat (made of darbha or kusa grass).
- Donor should be seated facing east and the receiver is to be seated to his right facing north direction.
- Donor should utter the name of the subject of the gift, its presiding deity, and purpose for which he makes the gift and chant the prescribed mantras of the occasion during which the dana is made.
- Donor explicity says " I make a gift to you of such an such an article" and and the donee says "give". Then the donor pours water in the donee's hand along with offer of the gift. Apastamba Dharmasutras (126.96.36.199 and 10) explicitly states that all gifts are to be made with water except in the case of vedic yajnas where they are to be made as directed by the vedic texts. Gautama (5.6) also supports the same.
- The donor has to offer the gifts accompanied by a separate dakshina to the donee.
Dana Associated Terminology
The enormous amount of literature on dana and the accompanying science, wisdom, forms, and stories come with an important caveat: most of this is not known even among practicing Hindus. Most are not able to distinguish between dana, dakshina, bhiksha, and bheekh. Few, if any are aware of the different forms of dana, and their purpose. As a result, the practice of daan has all but disappeared. This is partly due to a disconnect with literary heritage.
Dana : Involves giving of mainly material items with proper respect, following rituals without an expectation of any return.
Dakshina : Often confused with Dana, Dakshina is a type of honorarium for services. Dakshina helps pay for the effort expended in performing the daan ceremony, and any incidental expenses. The amount given is not an agreed amount and is usually a random amount paid by the donor as covering fees for the dana. It does not qualify as a dana. Any donation is accompanied by dakshina.
Bhiksha : It is the provision of food and other basic necessities mainly to ascetics and brahmacharis living in ashrams.
Bheek : It is the giving of alms to beggars, without recitation of any mantra nor is the receiver classified as a pratigrihita.
According to shastras, there is a distinction between yaga, homa and dana.
Yaga : A yaga is constituted by abandoning something that belongs to one, intending it for a deity and accompanying it with vedic mantras.
Homa : Homa is offering into fire something that belongs to oneself over which one abandons one's ownership with an intention to make an offering to the deities.
Dana : Dana is willful cessation of one's ownership over a thing and creating the ownership of another over that thing. Dana occurs when the other person accepts the thing, which may be mental or vocal or physical.
निष्फलदानम् ॥ Fruitless Dana
There are instances in the shrutis and smritis that some danas do not yield the desired results or are considered improper actions. Such danas which are not to be performed may again be classified based on the donor, danadravya (material) time, place etc. The important ones find mention here below.
Nine types of property should not be given in dana  under any circumstances and one who does so should undergo prayaschitta for doing so.
सामान्यं याचितं न्यासमाधिर्दाराश्च दर्शनम्॥ अन्वाहितं च निक्षेपः सर्वस्वं चान्वये सति॥ ४.५२ ॥ आपत्स्वपि न देयानि नववस्तूनि पंडितैः॥ यो ददाति स मूढात्मा प्रायाश्चित्तीयते नरः॥ ४.५३ ॥ (Skan. Pura. 1.4.52 and 53)
sāmānyaṃ yācitaṃ nyāsamādhirdārāśca darśanam॥ anvāhitaṃ ca nikṣepaḥ sarvasvaṃ cānvaye sati॥ 4.52 ॥ āpatsvapi na deyāni navavastūni paṃḍitaiḥ॥ yo dadāti sa mūḍhātmā prāyāścittīyate naraḥ॥ 4.53 ॥
- Samanya (सामान्यम्) - that which is ordinary or owned by everyone.
- Yachita (याचितम्) - that which has been borrowed from someone.
- Nyasa (न्यासम्) - that which has been deposited with you in trust.
- Aadhi (आधि)- that which has been pawned with you.
- Dana (दानम्) - that which has already been given once.
- Dana dhanam (दानधनम्) - that which has been received in dana.
- Anvahita (अन्वाहितम्) - that which has been kept in trust with X, who has placed it in safe-keeping with Y.
- Nikshipta (निक्षिप्तम्) - that which has been entrusted to someone.
- Sanvaya Sarvasva Dana (सन्वय सर्वस्वदानम्) - giving away everything despite availability of descendants.
The donation of things in the above category are never to be done as recognised by the Panditas and one who makes such a donation is a Mudhatma, a dullard and has to perform Prayaschitta for such an act.
प्रतिग्रहीता ॥ Acceptor
A receiver should be assessed for his mental attitudes and physical conditions by the donor for a dana to be fruitful. There are sixteen kinds of payments made to acceptors that does not qualify as dana.
Some of these that lead to a fruitless effort include dana given : to an immoral Brahmin, to a fallen Brahmin, to a thief, to a liar, to an ingrate, to a sinner, to a person who sells the Vedas, money earned through injustice to the village/town priest, to one’s father and other such gurujan, to snake-charmers, to one’s servants, to one’s family, to a person who abandons his vanprastha ashram, or sanyasa ashram and becomes a householder again.
- Nirukta (Adhyaya 3)
- Kane, Pandurang. Vaman. (1941) History of Dharmasastra, Volume Two, Part 2. Poona: Bhandarkar Oriental Research Institute
- Rigveda (Mandala 1 Sukta 125)
- Pt. Ramgovind Trivedi. (1954) Hindi Rigveda. Prayaga:Bharat's Press Ltd
- Manusmriti (Adhyaya 1)
- Mahabharat. Shantiparv. Ch. 231.27-28 (Ved Vyas, 2001, p. 5036).
- Agarwal, Sanjay. (2010) Daan and Other Giving Traditions in India. New Delhi: AccountAid, India
- Skanda Purana (Khanda 1 (Mahesvara Khanda) Adhyaya 4)
- Taittiriya Upanisad, 1:11:2 and 1:11:3
- Mahabharat, Van Parv, Markandeya Samaasya Parv. Ch. 198 (Ved Vyas, 2001, pp. 1518-21)
- Vachaspatyam (Refer to Da - दा)
- Pt. Bharatachandra Siromani (1873) Chaturvarga Chintamani by Hemadri, Vol 1, Dana kanda. Adhyaya 3 - Pages 82 to 86 Calcutta: The Asiatic Society of Bengal
- Kurma Purana (Uttara Bhaga Adhyaya 26)
- Bhagavata Purana (Skanda 8 Adhyaya 19)
- Shastri, Ramnarayanadatta Pandey. Mahabharata Volume 6 (With Hindi Translation) Gorakhpur : Gita Press
- A.C.Bhaktivedanta Swami Prabhupada (1972), Bhagavad-gita As it is,The Bhakti Vedanta Book Trust
- Brahmanda Purana (Purva Bhaga Adhyaya 32)
- Pt. Bharatachandra Siromani (1873) Chaturvarga Chintamani by Hemadri, Vol 1, Dana kanda. Calcutta: The Asiatic Society of Bengal
- Mahabharat, Vanparv, Markandeya Samaasya Parv, 188.8.131.52-8, (Ved Vyas, 2001, p. 1524)