Create Taxonomy for WordPress Custom/Built-in post type

advanced-taxonomy.php

<?php
// hook into the init action and call bs_create_color_taxonomy when it fires
add_action( 'init', 'bs_create_color_taxonomy', 0 );

function bs_create_color_taxonomy() {
	// Add new taxonomy, make it hierarchical (like categories)
	$labels = array(
		'name'              => _x( 'Colors', 'taxonomy general name', 'textdomain' ),
		'singular_name'     => _x( 'Color', 'taxonomy singular name', 'textdomain' ),
		'search_items'      => __( 'Search Colors', 'textdomain' ),
		'all_items'         => __( 'All Colors', 'textdomain' ),
		'parent_item'       => __( 'Parent Color', 'textdomain' ),
		'parent_item_colon' => __( 'Parent Color:', 'textdomain' ),
		'edit_item'         => __( 'Edit Color', 'textdomain' ),
		'update_item'       => __( 'Update Color', 'textdomain' ),
		'add_new_item'      => __( 'Add New Color', 'textdomain' ),
		'new_item_name'     => __( 'New Color Name', 'textdomain' ),
		'menu_name'         => __( 'Color', 'textdomain' ),
	);

	$args = array(
		'hierarchical'      => true,
		'labels'            => $labels,
		'show_ui'           => true,
		'show_admin_column' => true,
		'query_var'         => true,
		'rewrite'           => array( 'slug' => 'color' ),
	);

	register_taxonomy( 'color', array( 'product' ), $args );
}

simple-taxonomy.php

<?php
//simple taxonomy creation
add_action( 'init', 'bs_create_product_color_tax' );

function bs_create_product_color_tax() {
	register_taxonomy(
		'color',
		'product',
		array(
			'label' => __( 'Color' ),
			'rewrite' => array( 'slug' => 'color' ),
			'hierarchical' => true,
		)
	);
}