Shrink Wrap - S4-E25
Continuity mistake: In the scene when the therapist asks Arthur to recall a specific incident about not being heard from his childhood, he is playing with his pen cap. The shot cuts and he is instantly holding his note pad with both hands. (01:35:40)
Answer: Sara hasn't been mentioned in later episodes, and it suggested in later episodes that she never existed, and that Carrie is an only child. Kevin James stated that the producers couldn't think of an good plots to use with Sara, so they left her out.