diff --git a/src/Microsoft.OpenApi.Readers/Microsoft.OpenApi.Readers.csproj b/src/Microsoft.OpenApi.Readers/Microsoft.OpenApi.Readers.csproj
index b2e92e560..e3a40ffb7 100644
--- a/src/Microsoft.OpenApi.Readers/Microsoft.OpenApi.Readers.csproj
+++ b/src/Microsoft.OpenApi.Readers/Microsoft.OpenApi.Readers.csproj
@@ -33,7 +33,7 @@
         </PackageReference>
 
         <PackageReference Include="SharpYaml" Version="2.1.1" />
-        <PackageReference Include="System.Text.Json" Version="[8.0,)" />
+        <PackageReference Include="System.Text.Json" Version="[8.0.5,)" />
         <NuGetAuditSuppress Include="https://github.com/advisories/GHSA-hh2w-p6rv-4g7w" />
         <NuGetAuditSuppress Include="https://github.com/advisories/GHSA-8g4q-xg66-9fp4" />
     </ItemGroup>
diff --git a/src/Microsoft.OpenApi/Microsoft.OpenApi.csproj b/src/Microsoft.OpenApi/Microsoft.OpenApi.csproj
index 2231ad6f8..5f0cb79cc 100644
--- a/src/Microsoft.OpenApi/Microsoft.OpenApi.csproj
+++ b/src/Microsoft.OpenApi/Microsoft.OpenApi.csproj
@@ -23,7 +23,7 @@
         <ContinuousIntegrationBuild>true</ContinuousIntegrationBuild>
     </PropertyGroup>
     <ItemGroup>        
-        <PackageReference Include="System.Text.Json" Version="[8.0,)" />
+        <PackageReference Include="System.Text.Json" Version="[8.0.5,)" />
         <NuGetAuditSuppress Include="https://github.com/advisories/GHSA-hh2w-p6rv-4g7w" />
         <NuGetAuditSuppress Include="https://github.com/advisories/GHSA-8g4q-xg66-9fp4" />
     </ItemGroup>
diff --git a/src/Microsoft.OpenApi/Models/References/BaseOpenApiReferenceHolder.cs b/src/Microsoft.OpenApi/Models/References/BaseOpenApiReferenceHolder.cs
index e01545c61..2f402b8cc 100644
--- a/src/Microsoft.OpenApi/Models/References/BaseOpenApiReferenceHolder.cs
+++ b/src/Microsoft.OpenApi/Models/References/BaseOpenApiReferenceHolder.cs
@@ -63,7 +63,8 @@ protected BaseOpenApiReferenceHolder(string referenceId, OpenApiDocument hostDoc
     /// <inheritdoc/>
     public virtual void SerializeAsV3(IOpenApiWriter writer)
     {
-        if (!writer.GetSettings().ShouldInlineReference(Reference))
+        if (!writer.GetSettings().ShouldInlineReference(Reference) 
+            || Reference.Type == ReferenceType.Tag) // tags are held as references need to drop in.
         {
             Reference.SerializeAsV3(writer);
         }
diff --git a/test/Microsoft.OpenApi.Hidi.Tests/Services/OpenApiFilterServiceTests.cs b/test/Microsoft.OpenApi.Hidi.Tests/Services/OpenApiFilterServiceTests.cs
index 513355b50..753f2e9d9 100644
--- a/test/Microsoft.OpenApi.Hidi.Tests/Services/OpenApiFilterServiceTests.cs
+++ b/test/Microsoft.OpenApi.Hidi.Tests/Services/OpenApiFilterServiceTests.cs
@@ -1,13 +1,16 @@
 // Copyright (c) Microsoft Corporation. All rights reserved.
 // Licensed under the MIT license.
 
+using System.Globalization;
 using Microsoft.Extensions.Logging;
+using Microsoft.OpenApi.Extensions;
 using Microsoft.OpenApi.Models;
 using Microsoft.OpenApi.Models.Interfaces;
 using Microsoft.OpenApi.Models.References;
 using Microsoft.OpenApi.Reader;
 using Microsoft.OpenApi.Services;
 using Microsoft.OpenApi.Tests.UtilityFiles;
+using Microsoft.OpenApi.Writers;
 using Moq;
 using Xunit;
 
@@ -235,7 +238,14 @@ public async Task CopiesOverAllReferencedComponentsToTheSubsetDocumentCorrectly(
             using var stream = File.OpenRead(filePath);
             var settings = new OpenApiReaderSettings();
             settings.AddYamlReader();
-            var doc = (await OpenApiDocument.LoadAsync(stream, "yaml", settings)).Document;            
+            var doc = (await OpenApiDocument.LoadAsync(stream, "yaml", settings)).Document;
+            
+            // validated the tags are read as references
+            var openApiOperationTags = doc.Paths["/items"].Operations[OperationType.Get].Tags?.ToArray();
+            Assert.NotNull(openApiOperationTags);
+            Assert.Single(openApiOperationTags);
+            Assert.True(openApiOperationTags[0].UnresolvedReference);
+            
             var predicate = OpenApiFilterService.CreatePredicate(operationIds: operationIds);
             var subsetOpenApiDocument = OpenApiFilterService.CreateFilteredDocument(doc, predicate);
 
@@ -255,6 +265,26 @@ public async Task CopiesOverAllReferencedComponentsToTheSubsetDocumentCorrectly(
             Assert.Single(targetHeaders);
             Assert.NotNull(targetExamples);
             Assert.Single(targetExamples);
+            // validated the tags of the trimmed document are read as references
+            var trimmedOpenApiOperationTags = subsetOpenApiDocument.Paths["/items"].Operations[OperationType.Get].Tags?.ToArray();
+            Assert.NotNull(trimmedOpenApiOperationTags);
+            Assert.Single(trimmedOpenApiOperationTags);
+            Assert.True(trimmedOpenApiOperationTags[0].UnresolvedReference);
+            
+            // Finally try to write the trimmed document as v3 document
+            var outputStringWriter = new StringWriter(CultureInfo.InvariantCulture);
+            var writer = new OpenApiJsonWriter(outputStringWriter)
+            {
+                Settings = new OpenApiWriterSettings()
+                {
+                    InlineExternalReferences = true,
+                    InlineLocalReferences = true
+                }
+            };
+            subsetOpenApiDocument.SerializeAsV3(writer);
+            await writer.FlushAsync();
+            var result = outputStringWriter.ToString();
+            Assert.NotEmpty(result);
         }
 
         [Theory]
diff --git a/test/Microsoft.OpenApi.Hidi.Tests/UtilityFiles/docWithReusableHeadersAndExamples.yaml b/test/Microsoft.OpenApi.Hidi.Tests/UtilityFiles/docWithReusableHeadersAndExamples.yaml
index 60ee7e5c8..8edeb1945 100644
--- a/test/Microsoft.OpenApi.Hidi.Tests/UtilityFiles/docWithReusableHeadersAndExamples.yaml
+++ b/test/Microsoft.OpenApi.Hidi.Tests/UtilityFiles/docWithReusableHeadersAndExamples.yaml
@@ -7,6 +7,8 @@ servers:
 paths:
   /items:
     get:
+      tags:
+        - list.items
       operationId: getItems
       summary: Get a list of items
       responses:
diff --git a/test/Microsoft.OpenApi.Tests/Models/References/OpenApiTagReferenceTest.cs b/test/Microsoft.OpenApi.Tests/Models/References/OpenApiTagReferenceTest.cs
index bed3500d3..d08ad76f9 100644
--- a/test/Microsoft.OpenApi.Tests/Models/References/OpenApiTagReferenceTest.cs
+++ b/test/Microsoft.OpenApi.Tests/Models/References/OpenApiTagReferenceTest.cs
@@ -45,6 +45,7 @@ public class OpenApiTagReferenceTest
           description: The user was not found.
       tags:
         - $ref: '#/tags/user'
+        - users.user
 components:
   schemas:
     User:
@@ -60,11 +61,13 @@ public class OpenApiTagReferenceTest
 ";
 
         readonly OpenApiTagReference _openApiTagReference;
+        readonly OpenApiTagReference _openApiTagReference2;
 
         public OpenApiTagReferenceTest()
         {
             var result = OpenApiDocument.Parse(OpenApi, "yaml", SettingsFixture.ReaderSettings);
             _openApiTagReference = new("user", result.Document);
+            _openApiTagReference2 = new("users.user", result.Document);
         }
 
         [Fact]
@@ -73,6 +76,7 @@ public void TagReferenceResolutionWorks()
             // Assert
             Assert.Equal("user", _openApiTagReference.Name);
             Assert.Equal("Operations about users.", _openApiTagReference.Description);
+            Assert.True(_openApiTagReference2.UnresolvedReference);// the target is null
         }
 
         [Theory]
@@ -108,5 +112,39 @@ public async Task SerializeTagReferenceAsV31JsonWorks(bool produceTerseOutput)
             // Assert
             await Verifier.Verify(outputStringWriter).UseParameters(produceTerseOutput);
         }
+        
+        [Theory]
+        [InlineData(true)]
+        [InlineData(false)]
+        public async Task SerializeTagAsV3JsonWorks(bool produceTerseOutput)
+        {
+            // Arrange
+            var outputStringWriter = new StringWriter(CultureInfo.InvariantCulture);
+            var writer = new OpenApiJsonWriter(outputStringWriter, new OpenApiJsonWriterSettings { Terse = produceTerseOutput });
+
+            // Act
+            _openApiTagReference2.SerializeAsV3(writer);
+            await writer.FlushAsync();
+
+            // Assert 
+            Assert.Equal("\"users.user\"", outputStringWriter.ToString());
+        }
+        
+        [Theory]
+        [InlineData(true)]
+        [InlineData(false)]
+        public async Task SerializeTagAsV31JsonWorks(bool produceTerseOutput)
+        {
+            // Arrange
+            var outputStringWriter = new StringWriter(CultureInfo.InvariantCulture);
+            var writer = new OpenApiJsonWriter(outputStringWriter, new OpenApiJsonWriterSettings { Terse = produceTerseOutput });
+
+            // Act
+            _openApiTagReference2.SerializeAsV31(writer);
+            await writer.FlushAsync();
+
+            // Assert
+            Assert.Equal("\"users.user\"", outputStringWriter.ToString());
+        }
     }
 }