A corporation is a legal entity, separate from its shareholders and employees. The entity has liability for all obligations of the corporation. The shareholders contribute capital but have no liability to creditors, taxing authorities, or other parties that may have a claim against the corporation. A corporation is also treated as a separate entity for tax purposes and must pay taxes on its income. If there is any income left after corporate taxes, capital investment and other uses, it may be passed on to the shareholders in the form of dividends. Shareholders then pay taxes on the dividends they receive. Since the dividends passed on to shareholders have been taxed once at the corporate level and once at the shareholder level, it is said that corporate income is "double taxed."
An MLP is not considered a separate entity but rather an aggregation of all of its partners. For tax purposes, a partnership is treated as a "pass through" entity, meaning that there is no income taxation at the partnership level. The partnership's income is treated as having been earned by all of the partners and is therefore allocated among all the partners in proportion to their ownership interests in the partnership. All other items that figure into the income calculation, such as gains and losses, depreciation, etc., are also allocated to the partners. Each partner is then responsible for paying tax on his or her share of the income. Thus, partnership income is said to be "single taxed."