Topanga is staying with Cory's family for Christmas, and she's invited Angela to come along. However, Cory already invited Shawn. While the couple discusses the impending awkward situation, they both reveal that Angela and Shawn still love each other.
Cory, being Cory, takes it upon himself to place Angela and Shawn in close situations. When they begin to realize that something is up, Angela and Shawn approach Cory and Topanga. Cory lets slip that Angela and Shawn both love each other but they just don't know it. Angela tells Shawn that they need to talk, and the two step out.
Angela tells Shawn that she's always loved him, but she wanted Shawn to be sure about how he felt. Shawn hesitates, then admits that he isn't sure. Angela is heartbroken. Deciding that she can't wait for Shawn anymore, she ends the relationship permanently.
Meanwhile, Eric gets a job as a mall Santa, and enlists Rachel and Jack to be Mrs. Claus and an elf, respectively.
During one shift, they are visited by a bus load of underprivileged children. Jack and Eric decide to buy toys for all the children, and they are pleased when they see that they were able to make a difference.
This isn't enough for Eric, however, and he takes it upon himself to help as many need kids as possible. All goes well until a little boy returns with the fire truck that Eric gave him. The boy, Tommy, explains that he didn't believe Eric was Santa until he was given the fire truck. Now that he knows Eric is Santa, he wants to trade the gift for something he wants more. Wanting to make Tommy happy, Eric promises him anything he wants. Tommy asks for parents.
Unable to fulfill Tommy's wish, Eric instead invites Tommy to spend Christmas with his family.