In Rom 4, Paul uses two Old Testament figures as examples of an individual justified by God--Abraham (through his use of Gen 15:6) and Kind David (through his use of Psa 32). We have discussed Abraham's justification, and how such refutes, not supports, the Reformed view of justification (cf. this discussion on Rom 4:9 and this study on λογιζομαι).
In Rom 4:5-8, we read the following:
But to one who without works trusts him who justifies the ungodly, such faith is reckoned as righteousness. So also David speaks of the blessedness of those to whom God reckons righteousness apart from works: "Blessed are those whose iniquities are forgiven, and whose sins are covered; blessed is the one against whom the Lord will not reckon sin." (NRSV)
In the above pericope, Paul quotes from Psa 32:1 (cf. Psa 52:1); the entire psalm reads as follows:
Happy are those whose transgression is forgiven, whose sin is covered. Happy are those to whom the Lord imputes no iniquity, and in whose spirit there is no deceit. While I kept silence, my body wasted away through my groaning all day long. For day and night your hand was heavy upon me; my strength was dried up as by the heat of summer. Selah. Then I acknowledged my sin to you, and I did not hide my iniquity; I said, "I will confess my transgressions to the Lord," and you forgave the guilt of my sin. Selah. Therefore let all who are faithful offer prayer to you at a time of distress, the rush of mighty waters shall not reach them. You are a hiding place for me; you preserve me from trouble; you surround me with glad cries of deliverance. Selah. I will instruct you and teach you the way you should go; I will counsel you with my eye upon you. Do not be like a horse or mule without understanding, whose temper must be curbed with bit and bridle, else it will not stay near you. Many are the torments of the wicked but steadfast love surrounds those who trust in the Lord. Be glad in the Lord and rejoice, O righteous, and shout for joy, all you upright in heart. (NRSV)
In this psalm, David is proclaiming God's forgiveness of his sins of adultery with Bathsheba and murder of her husband, Uriah the Hittite (2 Sam 11-12). God sent Nathan the prophet to convict David of his heinous sins, with Nathan's parable of the little ewe lamb resulting in David being brought to his knees in repentance.
Paul in Rom 4, alongside the example of Abraham, uses this as an example of an individual who was justified by God, linking the justification of Abraham previously discussed with that of David's through the use of the conjunction καθάπερ ("even/just as") in v. 6.
The crucial question is "Was Psa 32 the first time David was forgiven of his sins and justified?" The biblical answer, which refutes Reformed soteriology, is "no."
The Bible clearly shows us that David, prior to committing those heinous sins, was a justified person. In his youth, David called on the Lord to defeat Goliath (1 Sam 17). David was so close to God that in 1 Sam 13:14 (cf. Acts 13:22) is described as a man after God's own heart, hardly something said of an unsaved person! Indeed, David was truly a justified child of God many years prior to the Bathsheba incident. If David was not justified, he was not a man of God, but a pagan idolater feigning belief in God in how he had lived his life prior to Psa 32 and had written earlier psalms before his encounter with Bathsheba in such a spiritually dead state with no true relationship with God.
As one writer put it:
We cannot escape the fact that Paul, in using the example of David in the context of justification, is saying not merely that David's sins were forgiven, but also that David was actually justified at this point. Paul, in Rm 4:5, underscores this fact both by speaking of "crediting righteousness" to David when he confessed his sin in Psalm 32, and by calling him a "wicked" person whom God must justify in order to return him to righteousness. We must understand, then, that a "crediting of righteousness" occurs at each point that one confesses his sins. Since this was not the first time David confessed sin before the Lord (which other Psalms verify, cf. Ps 25:7, 18; 51:5), he must have been "credited with righteousness" on each occasion of repentance. Since he was credited with righteousness upon repentance in Psalm 32, and since it is an established fact that he was not a man of God prior to his sin with Bathsheba, we must therefore consider all previous acts of repentance a "crediting of righteousness." (Robert A. Sungenis, Not by Faith Alone: The Biblical Evidence for the Catholic Doctrine of Justification [2d ed.; Catholic Apologetics International, 2009], 253)
Unless one wishes to accuse the apostle Paul of the grossest form of eisegesis (wrenching select passages of the psalter out of context), it is hard to escape that, based on sound exegesis, David lost his justification due to murder and adultery, and Psa 32 represents another justification (“re-justification” if you will) of David, per Paul’s soteriology. This disproves the Reformed view that justification is once-for-all, and can never be lost.