Heya @mdwpsyd. Labels are like categories for topics. They help organize discussions. We're not using them a whole lot right now, aside from two labels we've created for a number of forums: "Suggestion" and "Question".
You can choose the Question label when you post a new thread, but the Question label isn't present in every forum.
Tags, on the other hand, are like keywords for a post. So if you start a discussion about building a website with WordPress, for example, you could use "wordpress" as a tag. The more people use the same tags, the more useful the tags become for finding related discussions.