In TFS, Branching concept is used for Parallel development.
If you are currently working on 5.0 version and once the release is gone, you want to work on 5.1 Release for new enhancements and 5.0 for bug fixes. You can create a 5.1 version branch from 5.0 version branch, then you can work on both the branches simultenously one for Bug fixes and other for enhancements. You can keep both the branches in sync by using merging concept.
Go through below link for different Branching & Merging Stratergies:
http://www.codeplex.com/BranchingGuidanceIf you talking about project folder structure inside a branch, then it can be followed as per your development requirements.