Recommender systems are one of the most popular systems that help in personalization of ecommerce sites and collaborative web sites. Tags are textual description given to resources by users and are prevalent in most web 2.0 websites as they help in organization and retrieval of resources. In this paper we present an overview of the way tags are used in recommender systems and also on the aspect of recommendation of tags for items. This paper surveys the work done on two aspects of recommendations based on tags (a) Recommending items to users and (b) Recommending tags for items. This paper also discusses possible extensions that can improve recommendation capabilities using tags and make better tags recommendation for items.