Tonya asked the other day "How do you know when you're done editing?"
I wish there was a cut and dried answer for this. But there's really not. Sometimes it's an instinct, sometimes its by the advice of critique partners, and sometimes, its just because of a time constraint or deadline.
I recommend taking my daughter's advice. Yes, she's only 2 years old but hey, she's got good ideas. :)
She's recently realized that red means stop and green means go in regards to traffic lights. At a red light, she'll say "Go mama!" And I'll say "I can't, baby, the light is red." She'll wait a second while she cranes around the seat in front of her to look out the front window of the car, and then starts yelling "Greeeeen...GO!!!!" Like she's trying to convince the light to change so we can rush on to our next agenda.
Sometimes, you just gotta change that light to green and GO - stop editing and send that manuscript out to whereever it's going.
If you're truly not sure when your project is considered "Done", you need to get connected with a crit group who will help you know when to stop editing. Because truthfully, its easy to "over-edit". That's just as dangerous as just not enough editing. You don't want to send in sloppy or poorly crafted work to an editor or agent but you also don't want to send in prose that's been so red-marked by your editing pen that the voice isn't yours anymore and the dialogue is stiff and the pace too tight, etc.
As with all things, practice makes the decision easier. :) It will get better! Just keep writing. Keep editing. And keep submitting.