It depends. Normally closing costs are added to the basis of your house to determine capital gains when you sell the house. Capital gains are the difference between your basis and your proceeds received upon the sale of your house. If you received a check for the closing costs, this is an economic benefit to you and is taxable income. in return, your closing costs, with the exception of mortgage interest and property taxes can be added to the basis of your house to lessen your capital gains when you decide to sell your house. Your mortgage interest and property taxes can be deducted this year providing you can itemize your deductions this year.
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