Z is the ring of integers, t is a formal variable allowing us to discuss polynomials whose coefficients are in some ring. That’s what R[t] means: the ring of polynomials of the formal variable t with coefficients in R. Adding in t^-1 lets us include inverted terms like 2t^-3.

An algebra over a ring (call it S so we don’t confuse it with R from the previous paragraph) is a like a vector space over S, with the added structure that you can multiply elements of the algebra together (vector spaces only let you add their elements together). So for example the collection of even integers 2Z is an algebra over the ring of all integers Z. The collection of all polynomials with integer coefficients, Z[t], is another algebra over Z.

This is a great example of how dense language gets in math. There are tons of concepts hiding in the unstated background. Many are quite simple to explain individually, but there are so many of them that an outsider won’t know where to start to tease them apart. There’s a good reason to do it this way though; it would take a very long time to say anything in math without ever increasing levels of information density.