1. He only comes home during school breaks and Thanksgiving.

2. He only comes home during school vacations and Thanksgiving.

(Are both grammatical? What is the difference between 'breaks' and 'vacations?)

Both sentences are correct.

Breaks and vacations are about the same thing, but some might consider breaks to be shorter than vacations.

Yes, both sentences are grammatically correct.

In terms of meaning, "breaks" refer to shorter time periods when schools are closed, such as weekends, holidays (excluding Thanksgiving), or other short breaks throughout the school year. On the other hand, "vacations" generally refer to more extended periods of time when schools are closed, such as summer vacation or winter break.

So, in the first sentence, the person only comes home when there are shorter breaks from school, like weekends or holidays excluding Thanksgiving. In the second sentence, the person only comes home during longer breaks such as summer vacation or winter break, as well as Thanksgiving.