When submitting a text field of term names to Pods::add() if the term already exists the user will receive an error. Already existing terms are expected to include `term_id` in the `$tag_data` array.

add-terms-to-tax-gf-submission.php

<?php

/**
 * 1. install https://wordpress.org/plugins/gravity-forms-custom-post-types/
 * 2. Add the following code
 *
 * Now text fields in GF marked as taggable with the additional plugin will work as expected.  This code is a bit rough and there is more duplication than I would like... this is a first draft :)
 * This should work for any text field with a comma separated value, not just the above plugin.
 *
 */

function gf_pods_filter_maybe_add_tags( $tag_data, $value, $pods_data, $field, $field_items ) {

	$gform_check = strpos( implode( ',', array_keys( $_REQUEST ) ), 'gform' );
	$gform_check = false === $gform_check ? strpos( implode( ',', array_keys( $_POST ) ), 'gform' ) : true;

	if ( ! $gform_check ) {
		return $tag_data;
	}

	if ( is_int( reset($tag_data) ) ) {
		$term = get_term_by( 'term_id', reset($tag_data), $pods_data->datatype );
	} else {
		$term = get_term_by( 'name', reset($tag_data), $pods_data->datatype );
	}

	if ( ! $term ) {
		$term = get_term_by( 'slug', reset($tag_data), $pods_data->datatype );
	}

	if ( $term ) {
		$tag_data['term_id'] = $term->term_id;
	}

	return $tag_data;
}
add_filter( 'pods_api_save_pod_item_taggable_data', 'gf_pods_filter_maybe_add_tags', 10, 5 );

function gf_pods_filter_maybe_split_tags( $pieces, $is_new_item ) {

	$gform_check = strpos( implode( ',', array_keys( $_REQUEST ) ), 'gform' );
	$gform_check = false === $gform_check ? strpos( implode( ',', array_keys( $_POST ) ), 'gform' ) : true;

	if ( ! $gform_check ) {
		return $pieces;
	}

	// Get all the taxonomies for this post_type
	$tss = $ts = get_object_taxonomies($pieces['pod']['name']);

	// Relationship fields are pick fields so lets get those then quickly reduce all the non pick fields to 1 key => value pair
	$tax_fields = array_flip( wp_list_pluck( $pieces['fields'], 'pick_val', 'name' ) );

	// Make sure to do the same check on object fields
	$obj_tax_fields = array();
	foreach ( $pieces['object_fields'] as $value ) {
		if ( is_object( $value ) ) {
			if ( isset( $value->name ) ) {
				$obj_tax_fields[ $value->name ] = $value->pickval;
			} else {
				$obj_tax_fields[] = $value->pickval;
			}
		} else {
			if ( isset( $value['name'] ) ) {
				$obj_tax_fields[ $value['name'] ] = isset( $value['pick_val'] ) ? $value['pick_val'] : '';
			} else {
				$obj_tax_fields[] = isset( $value['pick_val'] ) ? $value['pick_val'] : '';
			}
		}
	}

	$obj_tax_fields = array_flip( $obj_tax_fields );

	// Unset the non-pick fields
	unset( $tax_fields[''] );
	unset( $obj_tax_fields[''] );

	// Make sure we are only sorting taxonomies that are in use
	$ts = array_intersect( array_keys($tax_fields), $ts );

	// Make sure we are only sorting taxonomies that are in use
	$tss = array_intersect( array_keys($obj_tax_fields), $tss  );

	// Make sure we are only using pick fields that ARE taxonomies
	foreach ($tax_fields as $tax => $name){
		if (!array_key_exists($tax, array_flip($ts))){
			unset($tax_fields[$tax]);
		} else {
			$pieces['fields'][$name]['value'] = explode(',', $pieces['fields'][$name]['value'] );
		}
	}

	// Make sure we are only using pick fields that ARE taxonomies
	foreach ($obj_tax_fields as $tax => $name){
		if (!array_key_exists($tax, array_flip($tss))){
			unset($obj_tax_fields[$tax]);
		} else {
			$pieces['object_fields'][$name]['value'] = explode(',', $pieces['object_fields'][$name]['value'] );
		}
	}

	return $pieces;
}
add_filter( 'pods_api_pre_save_pod_item_artistfilesdirectory', 'gf_pods_filter_maybe_split_tags', 10, 2 );