From Vol. XIII of Confessional Lutheran Dogmatics, Robert Preus, ed., Eschatology, p.108-109:
“The appropriateness of the Incarnate Lord’s exercising the office of judge, in which the Father and the Holy Spirit are most intimately united with Him, is discerned when we bear in mind that the criterion determining the destiny of each man is his acceptance or rejection of the person and work of Jesus Christ. While judgment is based on man’s response to the Word of God as such — ‘Blessed…are those who hear the word of God and keep it’ (Lk 11:28) — its outcome depends entirely on whether this response takes place according to Law or Gospel.
“Those incorporated into Christ escape judgment according to the Law, since they have been delivered from the Law’s universal condemnation through their faith in the vicarious atonement wrought in Jesus’ blood (Jn 5:24; Rom 8:1, 31-34). The confessed and absolved evil deeds of believers do not figure into their judgment, for they have long since dropped into the chasm of divine forgetfulness (Ps 103:12). Salvation is not determined by the degree of inherent righteousness which the believer has attained in the course of his struggle to live a sanctified life, but by his clinging to the external righteousness of Christ, apprehended by faith. This is not to say that the faith which lays hold of Christ can exist for a moment without its being the fount of all manner of good works (Mt 25:35f.; Jas 2:18-26), even if these good works, as in the case of the penitent thief, consist of nothing more than patient acceptance of merited punishment. The Christian as Christian does not fear the particular judgment that he will undergo at death and which will be made public on the Last Day. While the volume of good works performed in the state of grace will determine the degree of glory conferred on each member of the mystical body, the person of the Christian faces no danger at judgment, since, through the means of grace, the absolution pronounced on the world by the Father at the resurrection of Jesus has become effectually his.
“Those who are not incorporated into Christ face judgment according to the Law, whose works will justify no man (Ps 143:2; Rom 3:20). The reason unbelievers will be dealt with according to the Law is that their unbelief renders the Gospel inoperative in their case. The proclamation that excuses believers accuses those who consciously reject it (Jn 12:48). Christ’s bringing to light the hidden truth concerning each man (1 Cor 4:5) will disclose the tragedy that the unbeliever is under condemnation (Jn 3:18), so that ‘the wrath of God rests upon him’ (Jn 3:36). Our Lord’s clear words permit no doubt with respect to the fate of those persons who hear the Gospel in this life and reject its offer of God’s mercy in Him: ‘Whoever denies me before men, I also will deny before my Father who is in heaven’ (Mt 10:33; see also Mk 8:38; Lk 9:26; 2 Tm 2:12).”