Hi Tahir,
You will only need the tags if you want to create a limit for different products. For example, let’s say you want users to buy 10 products maximum. With the tags option, they will be able to add 10 different products to cart from a specific tag.
Now, if you want to create a limit individually for each product you don’t need the tag option. In that case, they will be able to add each product to cart 10 times.
The compatibility with Memberships works by allowing to create specific limits for each membership plan, like I was suggesting you on your first question:
[alg_wc_mppu limit="10" term_id="21" membership_plan="quarterly"]