How do I set up filter option? – I don’t see any checkbox in the theme optons panel.
In early releases filter option locates on theme options panel. Option was show or remove filters for whole the site. But we added few more page styles/templates such as 404, search result. Those pages doesn’t really need to show filters.
So, now you can show filters on your portfolio or blog pages. Please manage filter options from Additional options block when you are editing blog/portfolio page.