why thallophytes are known as algae?

The question is wrong. The correct question should be 'Why algae are known as thallophytes?'
Algae are known as thallophytes because embryo stage, vascular and mechanical tissues are absent in algae. The reproductive organs are single celled and non-jacketed called gametangia, the plant body is undifferentiated or thallus like in form. 

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They are called thallopytes because they lack vascular structures (xylem, phloem), leaves, roots.
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