Michael Bluth denounces his family after George Sr. escapes to Mexico with his secretary Kitty. But when Michael announces plans to move to Phoenix, Barry informs him that he cannot leave California or he will face prosecution for his father's crimes. While Michael scrambles to find the company checkbook, Lucille signs Buster up for the Army, and Lindsay and Tobias institute an open marriage.
Michael's new business model backfires when GOB suggests that they build a fake house in two weeks. Meanwhile, George Sr. turns up in Mexico, only to be captured by prison guards who have been injured by a shoddy device he tried to market in Mexico years earlier.
Michael gets a lead that his father has fled to Mexico and takes along a group to retrieve him. In the meantime, he tries to connect with George-Michael's girlfriend, Ann, and Buster tries to escape going off to the army by stowing away.
George is declared dead in Mexico and the Bluth family holds a wake for their dead family member. Meanwhile, George isn't dead and has returned to the USA, only to be found by a newly dumped George Michael.
Some unfortunate pictures of Tobias wind up on the internet, which the military mistakes for pictures of Iraq and proof that the Bluth Company was building houses over there. Wayne Jarvis, the family's former attorney, makes Michael an offer he cant refuse. Meanwhile, Buster seeks GOB's help to provide motivation for his Army training.
While Buster looks for ways to get out of serving in Iraq, Lindsay's quest to score a date at the Bluth Company Christmas party backfires after GOB's sexual harassment speech. Michael and Maeby get in trouble singing Afternoon Delight, but are quickly overshadowed by Oscar and Lucille's afternoon delight.
GOB suspects that rival housing contractor Stan Sitwell is up for a power grab at the Bluth Company when he wants to hire GOB. Michael plans the annual softball game between the rival companies, and Lindsay and Tobias move to separate bedrooms.
Michael finds out that some company funds have been unfrozen, which the family quickly spends on some elaborate stuff. He then trades the family's portable stairway vehicle for a Corvette. Tobias and Buster enjoy a night out, where Buster runs into a recuperated Lucille 2.
The family's careless selfish spending sprees cause them to lose control of the Bluth Company to Lucille 2. GOB tries to regain control of the company by courting Lucille 2. Michael continues to pursue his relationship with Sally Sitwell, only to wind up looking like he's 12. Buster scores a date with the company's new secretary after Michael sets them up.
Desperate to find money, at George Sr.'s request, Michael contacts "Uncle Jack", a man who the family has had past business relations with. Meanwhile, the family members enjoy their weekend getaways at a local spa / resort, and Michael suggests to Tobias that he buy a tape recorder to listen to some of his questionable phrasing.
Maggie Lizer returns after Michael bumps into her at the courtroom. But that's not before he realizes that she's 8 1/2 months pregnant. This comes after Michael tries to go after his long-time crush Sally Sitwell. Meanwhile, Michael decides to enlist Lindsay and Tobias to figure out if she's really pregnant.
Lindsay and Tobias continue to investigate the mysterious pregnancy by Maggie Lizer, while Michael continues to see her. Buster prepares to go off to Iraq, but before doing so, decides to go on a long-delayed right of passage - swimming in the ocean, and gets his hand bit off by a seal.
Lucille recruits George Michael to take Buster's place at the annual mother son dinner dance. While Michael and GOB are busy tracking down the seal that ate Buster's hand, Tobias signs away the family's life rights in order to get a part with his former acting coach Carl Weathers.
At his girlfriend's request, George-Michael decides to run for class president, but finds that it will not be easy competing with his rival, Steve Holt. Once again, Michael and GOB find themselves competing with each other as it's revealed that Steve Holt is GOB's son.
Determined to get back in the Magician's Alliance, GOB buys a sword from a Chinese shop and hires Buster to be the main magician while he's the assistant. Then he meets Tony Wonder who wants GOB and Buster to be on his next DVD.
Michael thinks George-Michael has set the bar too low with his dating standards, so he sets up a meeting between Ann's ultra-conservative parents and his family, hoping that would break them up. But the plan backfires when Michael realizes Ann's family is just as screwed up as his.
GOB is hoping to get even with the producers of "Girls With Low Self Esteem" after they botched his attempt to make the yacht disappear. Michael decides that it's finally time to get Lucille into rehab. Kitty returns with a cooler full of evidence against the Bluth Company, which Michael is determined to get.
Michael thinks it's time for George Sr. to leave the attic where he's been hiding as a fugitive. George-Michael helps his girlfriend Ann stage a protest against the American remake of the movie Dangerous Cousins, which turns out to be a big hit for Maeby. Tobias falls for Kitty, and learns that his "cease and desist" with the Blue Man Group has been lifted, and they ask Tobias to come to Las Vegas for an audition.