Plus Addressing is feature that allows you to automatically filter incoming email into folders without pre-creating the folders or filters to deal with them. 

For example, say your email address is you@yourdomain.com and you want to sign up for a newsletter called ABCD News. Furthermore, you want that newsletter to go into a fold in your email called ABCD. If you have plus addressing enabled, all you have to do is sign up for the newsletter with the email address:

you+ABCD@yourdomain.com

When the newsletter gets delivered to your email, it will automatically be placed in an ABCD folder, which will be created automatically if it does not already exist. No additional steps are required once you have enabled the plus addressing feature.

Enabling plus addressing:

Plus Addressing Enabled - Check this option to enable the feature. If this feature is disabled, the email will NOT be accepted.

Action - When a plus addressed email comes in, your webmail dashboard can act on it in several ways. 

• Move to folder - If the target folder exists, the incoming message will be placed into it. If the folder does not exist, it will be created. No more than 10 folders can be auto-created in this method during a six hour period to prevent abuse.
• Move to folder (if it exists) - If the target folder exists, the incoming message will be placed into it. Otherwise, the email will get placed in the Inbox.
• Leave in Inbox - Drops the message into your Inbox.