Allow the primer coat to dry, then remove your masking tape and paper. To smooth the repaired area for painting, you'll use your 400 grit wet/dry sandpaper, but this time you're going to wet sand the repair. Fill a spray bottle with clean water and spray the repair area and the sandpaper. If you don't have a spray bottle you can use whatever method you can to keep the paper and repair area wet. Smoothly sand the primer using a straight back and forth motion. When you begin to see the old paint show through the primer, you've gone far enough. If you sand away too much primer and you can see metal again, you'll have to re-prime and re-sand.
You've now successfully repaired your car's body! Well, almost. It still needs to be painted. While you can buy touch up paint in a spray can at automotive stores, they pretty much suck. I've never seen a repair that's been spray painted at home look good at all. Paint is best left to a professional. With all the money you saved doing the repair yourself, you can afford to have it properly painted.