During lunch at school, Cory and Shawn discuss all the presents they plan on receiving this year for Christmas. At home, Alan explains to Cory that Shawn may not have much of a Christmas because his father was just laid off. Cory decides to give one of his gifts to Shawn so he will have at least one present.
When Cory gives Shawn his brand new basketball, Shawn tells him he doesn't need it because his dad bought him a bunch of stuff already. Cory then tells Shawn that he heard about his father losing his job and he just wanted to make sure he got something this year. Shawn angrily states that he doesn't need Cory's charity and storms off. Confused by Shawn's behavior, Cory asks Mr. Feeny why he acted so ungrateful. Mr. Feeny tells Cory that a true gift, is one given without expectation of anything in return, even a thank you.
The next day in school, Minkus, unaware of Shawn's financial situation demands that he pay his five dollars towards Mr. Feeny's Christmas gift. When Shawn says he doesn't have the money, Minkus tells him that his name will be left off the Christmas card. Later, Cory approaches Minkus and gives him five dollars; claiming that Shawn didn't have the money because Cory hadn't paid back a previous loan. When Mr. Feeny reads the list of names on the card, Shawn is surprised to hear his name. He finds out that Cory paid the five dollars and realizes he was just helping a friend.
Meanwhile, Morgan's visit with a mall Santa goes horribly wrong when he passes out in front of her. Santa is doing just fine in the hospital but Morgan is sure that she's responsible for his demise. In an effort to cheer Morgan up, Mr. Feeny dons a Santa costume and pays her a visit.