It is not okay to put fabric softener in a toilet tank as it can cause damage to the rubber seals and toilet flapper but the fabric softener is safe for the toilet itself and the sewer and septic systems but when used too much it can damage the rubber seals and flapper and may build up in the sewer system and clog it.
The reason you should put fabric softener in your toilet overnight is to make the toilet smell fresh and clean.
Some people pour the fabric softener into the toilet bowl overnight and some people pour some fabric softener into the toilet tank so that every time they flush the toilet it smells good and like fresh laundry.
However the fabric softener in the toilet tank itself can be corrosive and damaging to the rubber seals and toilet flapper so it's best to only put the fabric softener in the toilet bowl and not the toilet tank.
The fabric softener in the toilet tank does work to keep the toilet smelling fresh and can help keep the toilet bowl clean but used too much it can cause damage to the rubber seals and the rubber flapper in the toilet tank.
So if you do add fabric softener to your toilet tank only add about a cup of fabric softener and not too much.
Fabric softener is safe for sewer and septic systems so it won't damage the sewer or septic system but if put in the toilet tank the fabric softener could cause problems overtime.
You can also keep your toilet smelling fresh and clean by using vinegar and baking soda in the toilet bowl and scrubbing it daily.
You can also add some vinegar to the toilet tank to keep the toilet tank clean and reduce sediment and limescale build up as well.