Among the doctrines of many Evangelicals is that of "imputed righteousness" . This doctrine takes different forms. At its simplest it is the idea that the righteousness of Mashiach has been "imputed" or ascribed to those united with him by emunah/faith- that God the Father regards believers as possessing the righteousness of Yeshua himself.
There are degrees of this. Some believe that it means that believers possess, in every way, the concrete and personal righteousness of Yeshua. Some hold that it means that believers possess not Yeshua's personal righteousness but simply the quality of righteousness, which has been imputed to them as a result of their faith. Some believe that although all believers are thus "saints" and acquitted as righteous, God still sees their sin and rebukes and purifies them. Some believe, more extremely, that God does not see them any longer as sinners or as sinning in any sense at all. I have long been cautious and skeptical about this doctrine, but recently it has suddenly begun to make sense to me. I think the scriptural view is that God justifies the faithful, which does indeed, in both Greek and Hebrew (most clearly in the latter), signify declare, or regard as, righteous.
The fundamental meaning of "righteousness" is to be in right relationship to God, though there are definite implications here that that will mean an increase in right relationship to other humans as well. To be declared righteous is to be regarded as someone fundamentally in right relationship with God, no doubt with the expectation that that rightness will increase. Those in Mashiach are free of condemnation, given the spirit, regarded by God as righteous, and welcomed in friendship with God now and eternal life after bodily death. These are all the possessions of the character classically (and still to this day) known in Judaism as a tzaddik (righteous one).
Paul is very clear that the righteousness we possess is through faith, not our own actions or religious behaviour. The implication of scripture is indeed that we are united to Christ by faith and are thus regarded as sons, ie. as children in good standing, or as righteous.
Does this mean that God does not see our sin? The answer came to me when thinking about how I regard my son. My son has flaws and will do things I disapprove of. Does that mean that at any time I regard him as a sinner, ie. as separate from me and outside of my love? No. Do I stop loving him then? Not if at that moment I myself am free of sin as God is always. The fact is that although I see my son's misdeeds and character flaws, he does not cease to be my son at that moment- I still regard him as beloved, as beautiful- as righteous.
What if my son were to stop listening to me, move out of my house, and not answer my calls or letters? What if he were then to begin acting against his best interests, distorting his true beauty and becoming more and more miserable and neurotic, while also behaving selfishly and finally unethically and destructively. What would I do?Would I stop trying to reach him? No, I would certainly keep sending messages. But as long as he remained turned inward and away from me, neither listening to me or living according to the values I tried to teach him, could I honestly be said to love him?
In a certain sense, the answer is yes. I would still think of him and try to reach him. In another sense, though, the answer is no. He would not feel like my son. I could not regard him as beautiful, and certainly not as righteous. I would not force him to come home and tie him to a chair while I pleaded with him (which would be unlikely to work in any case) and in that sense would, as scripture says, "abandon him to his wretched desires" (Romans 1:24).
The messages that I send to my errant son are known by some Christian theologians as "prevenient grace", God's attempt to get through to those not in relationship with Him. If one of my messages gets through there will still be a lot of work to do. Trust and communication will have to be re-established. Something has to be done to make amends for my son's behaviour, and he will need support and love. He will need to have faith in himself, and in me.
In Christianity the life and death of Yeshua Mashiach accomplishes all of this. God incarnates in the flesh and in his crucifixion takes upon Himself our sin and its effects, making amends and swallowing our debt. As well as justly making amends (albeit in a spectacular way) this demonstrates the depth of his love so as to generate love and trust in his errant children. When we read the letter from home that is Mashiach and believe it, our lives change. Living faith is not, of course, merely believing the letter, it is repentance, teshuva, metanoia, changing our lives around. If my son believes that all is forgiven, that I love him, that I am good, and trusts me again, than I will again regard him as righteous and love him fully, showering him with everything that I have to give him- even if he still has faults, still stumbles, still makes mistakes or doesn't listen to me on occasion.
My answer then is that God does see the sin of those with faith in Mashiach, but does not see us as sinners. We are the righteous, the saints who will sit at the messianic banquet at the end of time partaking of the love that dances inside the trinitarian God, even if as good children we still nevertheless sin. It is in that sense that we are simultaneously justus et peccator (just and sinners/ tzaddikim and resha'im).
There is another element of our righteous standing though that I have not brought out but is essential. As well as our trusting acceptance of Yeshua's sacrificial death on our behalf there is our loving union with Him as the Son of God, the one who makes God known, the embodiment of Torah, wisdom incarnate. Through baptism and loving faith we are spiritually united to Yeshua- we are in him and of him and His life is our life. Thus when the Father looks at Mashiach He sees us, and when he looks at us he sees Mashiach. It is Mashiach and humanity's election in Him that makes possible, in grace, our adoption. When we accept this in faith and are reborn in Yeshua then we take on Mashiach's status of the beloved.
This is not two things, of course, but one mystery described in two aspects. In Mashiach we are God's beloved children, no matter how we stumble, as long as we persist in faith. Although God does see our sins and works to sanctify us and make us all that we were meant to be, God simultaneously sees us as righteous, as in His Son, and holds us in the omnipresent strength of His warm hands.