End Purchase of Firearms by Dangerous Individuals Act of 2014

End Purchase of Firearms by Dangerous Individuals Act of 2014 - Requires each state to establish a reporting system through which mental health professionals may report to appropriate state entities information that is sufficient for inclusion in the National Instant Criminal Background Check System (NICS) regarding individuals: (1) who are committed to a mental institution on a voluntary basis, or who are temporarily committed or held on an involuntary basis, and who are determined to be a danger to themselves or others; or (2) who communicate to a mental health professional a serious threat of violence against another individual who is reasonably identifiable. Sets forth time periods after which the basis under which such information was made available no longer applies, and requires the Attorney General to modify or remove records from the NICS accordingly.

Requires each state to: (1) make electronically available to the Attorney General records from such information that are relevant to a determination of whether such an individual is disqualified from possessing or receiving a firearm, (2) modify or remove information from any database that the federal or state government makes available to the NICS when the basis for inclusion of such information no longer applies, and (3) ensure that its reporting system includes an appeals process comparable to the NICS process.

Requires each state to: (1) establish a process relating to temporarily committing or holding individuals on an involuntary basis at mental health facilities; and (2) ensure that any individual who is disqualified from possessing or receiving a firearm pursuant to information included in such a reporting system when the individual was under age 18 is evaluated by the date such individual is age 21 to determine whether he or she should remain disqualified.

Authorizes the Attorney General to withhold an increasing percentage of funds that would otherwise be allocated under the Edward Byrne Memorial Justice Assistance Grant Program from states that fail to comply with such requirements beginning three years after enactment of this Act.

Amends the federal criminal code to make it unlawful for an individual to sell or otherwise dispose of a firearm or ammunition to a person knowing that such person: (1) has been voluntarily, or temporarily and involuntarily, committed to a mental institution, has been determined to present a danger to others, and is serving a period of commitment at such institution (or, in the case of temporary involuntary commitment, has been released for less than five years); (2) has been formally committed and is serving a period of commitment or has been released; or (3) during the prior six-month period, has communicated to a mental health professional a serious threat to commit an act of physical violence against another identifiable person. Prohibits such a person from shipping, transporting, or possessing any firearm or ammunition in interstate or foreign commerce or from receiving any firearm or ammunition that has been shipped or transported in interstate or foreign commerce.

Sets forth provisions regarding: (1) guidelines for state reporting systems and for states to establish a process for temporarily committing or holding individuals at a mental health institution on an involuntary basis, (2) limiting liability for mental health professionals who fail to report under a reporting system, and (3) determinations of dangerousness.

Requires the Secretary of Health and Human Services (HHS) to enter into an agreement with the Institute of Medicine to conduct a comprehensive study on state statutes, enacted before enactment of this Act, that require mental health professionals to directly report certain individuals into state firearm prohibition databases.

Changes various statutory references to persons adjudicated as a "mental defective" to persons adjudicated as "ineligible due to disqualifying mental status."