The Three-Layer Variable Infiltration Capacity (VIC-3L) land surface model is extended to include biological and hydrological processes important to water, energy, and carbon budgets under water-limited climatic conditions: (1) movement of soil water from wet to dry regions through hydraulic redistribution (HR); (2) groundwater dynamics; (3) plant water storage; and (4) photosynthetic process. HR is represented with a process-based scheme and the interaction between HR and groundwater dynamics is explicitly considered. The impact of frozen soil on HR in the cold season is also represented. Transpiration is calculated by combining an Ohm's law analogy, where flow from the soil to leaves is buffered by plant water storage, with the Penman-Monteith method, where stomatal conductance is linked with photosynthesis. In this extended model (referred to as VIC+), water flow in plants and in the unsaturated and saturated zones, transpiration and photosynthesis are closely coupled, and multiple constraints are simultaneously applied to the transpiration process. VIC+ is evaluated with an analytical solution under simple conditions and with observed data at two AmeriFlux sites. Scenario simulations demonstrate the following results: (1) HR has significant impacts on water, energy, and carbon budgets during the dry season; (2) Rise of groundwater table, increase of root depth, HR, and plant water storage are favorable to dry-season latent heat flux; (3) Plant water storage can weaken the intensity of upward HR; (4) Frozen soil can restrict downward HR in the wet winter and reduce the soil water reserves for the dry season.