Terumot, Chapter Four, Mishnah One
1) One who sets aside only part of terumah and tithes, may take terumah from that [heap], but he may not take terumah from it for other produce.
2) Rabbi Meir says: he can also take terumah and tithes for produce elsewhere.
Section one: A person has a pile of produce from which he removed some of the terumah and tithes, but not all that he was supposed to give. He may subsequently take the rest of the terumah out of that same pile, since he is not obligated to separate all of the terumah and tithes at one point.
However, he cant take terumah out of this pile in order to exempt another pile. The reason is that this pile is already half-exempt and we look at it as if every part of it is half-exempt and half-liable. There is a rule that one is not allowed to take terumah out of an exempt pile of produce on behalf of another pile of produce that is still subject to the laws of terumah and tithes. Therefore he cant use the half-tithed pile for another fully untithed pile.
Section two: Rabbi Meir disagrees and holds that he can even use the half-tithed pile to separate terumah and tithes for another pile. When he took some terumah out in the beginning, he was only exempting part of the pile. So when he goes back and takes more terumah out of that same pile in order to exempt another fully untithed pile, he can say that the part of the produce that he is taking out is the untithed part of the pile. It turns out that he is taking from liable produce for other liable produce which is fine.