It’s very simple to manage your mailbox folders, but the process is not obvious when you’re in your mailbox. Here’s how it works:
First, open your Mail app and tap the Back arrow until you can see all of your inboxes and accounts.
Scroll until you can see you accounts listed below the Inboxes. Touch the name of the account where you’d like to manage the mailboxes. You can now see all of the mailboxes that are part of this email account.
In the upper right of the Mailboxes column you’ll see an Edit link. Touch that now. Then touch the New Mailbox link you see at the bottom left of this column.
Now, type the name of the new Mailbox (it’s really a folder – that’s what the icon is) you wish to add. Then click on the email link and select where you want this new mailbox to appear. If you want it to be a “top-level” mailbox – that’s one of the main boxes in the list – just click Save in the upper right on this column. If you want it to be a sub-folder under a top-level folder, select the “parent” folder then touch Save.
If you wish to DELETE a Mailbox, select the desired Mail account, touch Edit, touch the mailbox you want to delete and touch the red Delete Mailbox link. A pop-up box will ask you to confirm the delete request. If you delete a mailbox, everything in it is also deleted.