“…Return, you mischievous children…. (Yirmiyahu 3:22)

״….שובו בנים שובבים….״ – ירמיהו ג,כב׳

The Talmud (Yoma 86a) interprets this verse as saying that if you return to G-d out of love, your sins of the past will be reckoned by G-d as mere immaturity and foolish mischief. Commenting on this passage, Rashi observes that the effects of teshuva, repentance, are retroactive, actually undoing the wrongful deeds as though they never occurred.

How does teshuva have this ability – not only to repair but – to undo the fractures of the past? By the simple rules of logic, a cause precedes its effects – not vice versa! How can teshuva of the present change not only the future but also events that have already transpired?

The answer is that the chronology of cause and effect is only applicable if the present – the cause – brings about a change, but not in instances where the present merely sheds new light on reality, causing change simply by putting everything in a different perspective. Such change can be effective even retroactively; with changed perspective, the events of the past are exposed for what they truly were.

This explains the power of teshuva to undo the wrongdoings of the past. For the true and unchangeable identity of a Jew is a devotion to goodness and holiness. This essential goodness was only obscured in that fleeting moment of wrongdoing. Upon his return to his natural and true self, i.e. teshuva driven by a love of G-d, the Jew is not only changing his future life and lifestyle; he is revealing the good and pure soul that he was all along.

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—Likutei Sichos vol. 6, p. 54