Boot options can be handled by either the kernel itself or the init script in an initrd/initramfs.
The options that are handled as part of the 'vanilla' kernel are documented on this page (can also be found other places as well, but that was the first one I found). The boot parameters handled by Ubuntu's initramfs can be found here.
The vt.handoff parameter is a bit weird. What it does is explained in this askubuntu answer:
For a smooth boot process, we want to display something other than a
black screen as early as possible and leave it on screen until the
desktop is ready. vt.handoff=7
is part of this. We have the boot
loader display an aubergine background (we wanted to have an Ubuntu
logo as well, but there are problems with different aspect ratios
between the boot loader and the real system, so this is the next best
thing). vt.handoff=7
then causes the kernel to maintain the current
contents of video memory on virtual terminal 7, which is a new
"transparent" VT type. The first time that the kernel is told to
switch away from VT 7, either from Plymouth or manually (Alt-F1,
etc.), these contents are lost and VT 7 reverts to text mode.
I could only find a description of it from bug reports, but this bug report tells it's origins:
vt.handoff is a module parameter introduced in an Ubuntu-specific SAUCE patch by
Andy Whitcroft, ...It was written expressly for use in the Ubuntu boot process...
Because of this, any documentation would probably be with the module source (if such documentation exists).