The only time I use taunts in-game is this:
I'm facing an opponent of equal skill. It's 2/2 rounds and both of us are almost dead on health. The next successful attack by either party will win the battle, pretty much.
Sometimes, and only sometimes, I will bust out my Taunt in this situation. I figure it's pretty much 50/50 as to who will win, and sometimes the surprise of my Taunt will break their concentration long enough for me to get an edge. Or just doing the Taunt breaks my stress-level by reminding me that it's just a game, and again I get an edge. Win or lose, I get the extra psychological boost of having done a dangerous Taunt just before going in for the kill (living on the edge, ya know), which is just plain fun.
I've never gotten killed in mid-Taunt in these situations. It's MOSTLY worked out well for me in the end. But I don't plan to make a habit of it either, since I figure I can only be lucky so many times. So I use it sparingly.
End-of-Match Taunts are a completely different matter.
There is a fairly elaborate language of Victory in SoCal. What buttons you press AFTER winning a round, or a match, can speak volumes about you, and your opinion of your opponent. In rounds, it can also set a psychological tone. Taunts are just one of many options.
Throwing the opponent after a Win
This is always an indication of Dominance. You are showing to the opponent that you could have hurt them EVEN MORE if they were still alive. Some throws, like Ivy's throw where she wraps her whip around the opponent's neck from behind, or Astaroth's throw where he walks across the opponent, also indicate an awful lot of Disrespect.
Low attacks after a Win
Again, these emote Dominance. You are not finished hurting your opponent. Some attacks against finished Prone opponents can emote various degrees of dominance. I might do Yoshi's 9A+B, B to do a little dance on my prone foe, or might do Ivy's Whip State 44A+B to lay my whipsword right down their asscrack and rip it up. If I'm Ivy in Sword State, I might even be inspired to do that thing where I stretch one leg straight up and then bring my crotch down upon my downed foe in a fearsome splits (sorry, can't be bothered to look up the command for that right now).
Stance Change after a Win
Stance Change can also be a communication after a Win. For example, if I am Yoshi and have just defeated an enemy that I want to show respect for, I will always go into Meditation stance and repeatedly Heal myself. To show Disrespect, I might throw out any of Yoshi's many suicide moves. In Ivy's case, whether I have Respect or Disrespect for my enemy, I will often revert directly to Coiled Stance and stand perfectly still... in other words, I have sheathed my weapon. You are no longer a threat, I am saying, with this nonverbal language. Can be Respectful or Disrespectful, depending on context.
Special Attacks that give a particular VoiceOver
A great example of this is Yoshi's poison breath move. Even if you never use this in combat, it makes for a great End-Of-Game taunt. You're vomiting on top of the opponent... very Disrespectful. Also, Yoshi's Guard Break move... he says 'My guard is unbreakable!'. Again, even if you haven't ever used this move in game, it's a great End-Of-Game taunt to use against an opponent that you have just defeated by your superior use of Guard. Or, situation permitting, busting out Ivy's Serpent Tail can will get her to say 'This is ridiculous!', a Disrespectful statement. I'm sure that many other characters have special moves that can double as End-of-Game Taunts.
Taunting after a Round
Depending on your Character, or what Voice you have chosen for your Custom Character, your Taunt will be Respectful 'I don't understand' or Disrespectful 'Crawl to my feet'. So choose your Voice, and / or your use of straight-up Taunts, carefully if you want to use the language of victory successfully.
Taunt-spamming
Through use of the Taunt commands and the Guard button, it's possible to get a 'Max Headroom' type effect on your Taunts. I don't personally use this as I consider it a bit immature. But it can be effective... I can personally attest that I have been affected by Taunt-spamming on a few occasions, and got a bit angrier at my opponent than I should have been... especially when they used other mind-games on me in conjunction, and cheap tactics to boot. I might hate Taunt-spamming, but I can't in good conscience say that it doesn't have its uses.
Tea Bagging
I saved the worst for last. Good lord, this is the most ridiculous excuse for a mind-game thing I have ever seen in SoCal. I know what you fags are trying to do, and don't you know how ridiculous you look? I will go on record right now and say that every time I have ever been TB'd, I said to myself 'this is obviously a total fucking scrub who doesn't know shit about SC' and every time I have been right, and gone on to kick their ass silly.
OK well that's all of my observations and/or opinions regarding Taunts. The point is, that you can use all sorts of Victory language, both verbal and nonverbal, to show your opponent what you think of them.... and can use some of them for mind-games. Use of this kind of Victory language is definitely only a tiny portion of SoCal... but it is a part of it. You may have noticed that I main Ivy and Yoshi from my examples... well that's what I know. As Ivy or Yoshi, I can convey 'I respect you' or 'I hate you' in all sorts of nuanced ways. Hope that you will be inspired by my post to see your character's (and your Soul's) unique options for verbal and nonverbal language in new ways in the game of SoCal. Selah.