I'm having trouble figuring out the sales expenses. Is that pretty much the closing costs?

Yes. These would include closing costs that you paid at closing that are not included elsewhere on your tax return. (So if you are reporting mortgage interest payments or property tax payments related to the sale elsewhere on your tax return, do not include these two costs as selling expenses also.)

You are allowed to deduct from the sales price almost any type of selling expenses, provided that they don’t physically affect the property. Such expenses may include:

• advertising
• appraisal fees
• attorney fees
• closing fees
• document preparation fees
• escrow fees
• mortgage satisfaction fees
• notary fees
• points paid by seller to obtain financing for buyer
• real estate broker's commission
• recording fees (if paid by the seller)
• costs of removing title clouds
• settlement fees
• title search fees, and
• transfer or stamp taxes charged by city, county, or state governments

I am looking at my HUD settlement statement. It seems that line 1400 settlement charges would constitute the sales expenses? Is that correct?

Thank you.

Nope ... you cannot just take the amount on line 1400 ... you cannot use the 900 or 1000 sections at all and there maybe other items that were not closing costs so you have to look carefully.