@drmessner1248-gm
There are no special rules that would allow you to avoid paying income tax on money that you took out of an IRA, or income from selling investments, just because you used the money to purchase a home.
There was an old rule that you could defer taxes on the capital gain from selling your personal residence if you invested the money in a new personal residence within two years, but that rule was eliminated in 1997, so it would not have applied to the 2014 sale of your home.
If you met the IRS definition of a “first time home buyer“ in 2018, and you withdrew money from an IRA to make the down payment, you could have avoided the 10% penalty for early withdrawal if you were under age 59 1/2. If you were over age 59 1/2 in 2018 and we’re not assessed the 10% penalty anyway, then the first time homebuyer rule is irrelevant in your situation.
Wherever the money came from in 2018, either withdrawing from an IRA or multiple IRAs, or selling other investments, you would have received a tax statement; either a 1099-R for retirement account withdrawals or a 1099-B for the sale of stocks or other investments through a broker. The income should have been reported on your tax return.
interestingly, the normal IRS statute of limitations is three years. If you filed your 2018 return on time, the statute of limitations would have expired April 15, 2022. That would mean that unless the IRS notified you of the deficiency before April 15, 2022, you are not liable for your mistake. However, in some cases the statute of limitations is extended to six years, or you might have filed your 2018 return late which would also extend the statute of limitations. Either way, you may want to engage the services of a tax professional who can help you ensure that your taxes were prepared correctly, navigate the statute of limitation issue, and negotiate with the IRS over any penalties or interest that may be required.
