Justification is about how God deals with our sin to make us right with Him. The Bible teaches that when we have faith in Jesus Christ, God forgives us our sin through Christ’s sacrificial death. In Romans 4:7-8 Paul quotes from Psalm 32, where David says: ‘Blessed are they whose transgressions are forgiven, whose sins are covered. Blessed is the man whose sin the Lord will never count against him.’ We cannot be righteous by our own effort because our sin has tainted us. No amount of effort can scrub away that dirt. We need God to forgive our sin and make us clean if we are to be received by Him. Jesus' death on the cross takes away our sin and makes us clean when we trust in Him.
However, forgiveness of sin only makes us innocent before God: it does not yet make us righteous. Part of our justification is that God thinks of Christ’s righteousness as belonging to us. When we have faith in Jesus, a two-way transaction takes place. Jesus takes all of our unrighteousness, our sin, on to Himself and dies in our place and Christ gives us His righteousness, so that we might live a life that is pleasing to God. For those who trust in Jesus, God credits righteousness to our account (Romans 4:5). When God looks at His people, He sees Christ’s righteousness rather than our own unrighteousness. Paul says that we have received the ‘gift of righteousness’ (Romans 5:17). This means that we are now declared righteous in God’s sight, not by our own efforts, not on the basis of our good works, but only by His grace and in response to our faith. And even then, our faith is not an act of righteousness on our part but is rather a gift from God to us. This is clearly stated in Ephesians: ‘For it is by grace you have been saved, through faith - and this not from yourselves, it is the gift of God - not by works, so that no one can boast. For we are God’s workmanship, created in Christ Jesus to do good works, which God prepared in advance for us to do’ (Ephesians 2:8-10). Only in response to God’s saving grace can we then do ‘good’ or ‘righteous’ works which please Him. (see Just)