Code to register a projects and projects groups taxonomy.

register-projects-taxonomies.php

<?php

function akv3_register_projects_tax() {
	register_taxonomy(
		'projects',
		array('post'),
		array(
			'hierarchical' => true,
			'labels' => array(
				'name' => __('Projects', 'projects'),
				'singular_name' => __('Project', 'projects'),
				'search_items' => __('Search Projects', 'projects'),
				'popular_items' => __('Popular Projects', 'projects'),
				'all_items' => __('All Projects', 'projects'),
				'parent_item' => __('Parent Project', 'projects'),
				'parent_item_colon' => __('Parent Project:', 'projects'),
				'edit_item' => __('Edit Project', 'projects'),
				'update_item' => __('Update Project', 'projects'),
				'add_new_item' => __('Add New Project', 'projects'),
				'new_item_name' => __('New Project Name', 'projects'),
			),
			'sort' => true,
			'args' => array('orderby' => 'term_order'),
			'public' => false,
			'show_ui' => true,
		)
	);
	register_taxonomy(
		'project-groups',
		array('project'),
		array(
			'hierarchical' => true,
			'labels' => array(
				'name' => __('Project Groups', 'projects'),
				'singular_name' => __('Project Group', 'projects'),
				'search_items' => __('Search Project Groups', 'projects'),
				'popular_items' => __('Popular Project Groups', 'projects'),
				'all_items' => __('All Project Groups', 'projects'),
				'parent_item' => __('Parent Project Group', 'projects'),
				'parent_item_colon' => __('Parent Project Group:', 'projects'),
				'edit_item' => __('Edit Project Group', 'projects'),
				'update_item' => __('Update Project Group', 'projects'),
				'add_new_item' => __('Add New Project Group', 'projects'),
				'new_item_name' => __('New Project Group Name', 'projects'),
			),
			'sort' => true,
			'args' => array('orderby' => 'term_order'),
			'public' => false,
			'show_ui' => true,
		)
	);
}
add_action('init', 'akv3_register_projects_tax', 999);