What is the biblical basis for the rejection of purgatory?

The standard Protestant answer to this (from Protestants who really understand what purgatory is) is that Scripture says Jesus paid the penalty for all of our sins. Therefore, to say that we need to pay a temporal penalty for sins is heresy (essentially, they don't usually use that word). Here is a link to a gotquestions article about it.

Of interest is the fact that this phrase, Jesus died for ALL of our sins, to my knowledge is not in scripture. Scripture says that Jesus died for our sins, to be sure. And I would not disagree with the notion that, in a general and broad sense, Jesus died for all of them. However, as justification for rejecting a doctrine like purgatory, this argument seems weak, especially because the notion that Jesus died for all of our sins does not undermine the notions we have about justice in this life, namely that one who wrongs another must make temporal recompense (eg restoring money that you stole). Jesus died for your sin of theft. That absolves you from hell, to be sure. It most certainly does not mean you may keep the money you stole.

The linked GQ article cites two passages "Jesus died to pay the penalty for all of our sins (Romans 5:8). Isaiah 53:5" Neither of these state that Jesus died for ALL of our sins. Later, the same article states plainly that Jesus died for our sins and cites 1 Corinthians 15:3, which says "For I delivered to you as of first importance what I also received: that Christ died for our sins in accordance with the Scriptures."

Another GQ article making the same claim cites 2 Corinthians 5:21, which says "For our sake he made him to be sin who knew no sin, so that in him we might become the righteousness of God."

An unrelated Protestant site features an article making this claim and citing 1 Cor. 15:3, which you will see above says nothing about ALL sins.

Now, I haven't read every single verse on sin in the New Testament in order to sus out whether this phrase actually appears, but it seems to me that a Protestant making this claim would more likely than not cite such a passage instead of a weaker passage, if such a passage exists. I would be interested if someone could point me to such a passage.

Another common objection is that Scripture appears to plainly state that those who die go directly to heaven or hell, from the LCMS FAQ

QUESTION: What's the Lutheran response to the Roman Catholic teaching of purgatory?

ANSWER: Lutherans have always rejected the traditional Roman Catholic teaching regarding purgatory because 1) we can find no scriptural basis for it, and 2) it is inconsistent, in our view, with the clear teaching of Scripture that after death the soul goes directly either to heaven (in the case of a Christian) or hell (in the case of a non-Christian), not to some "intermediate" place or state.

What Scripture teaches concerning the death of the Christian is summarized as follows by Lutheran theologian Edward Koehler in his book, A Summary of Christian Doctrine:

In the moment of death the souls of the believers enter the joy of heaven. Jesus said to the malefactor: "Today shalt thou be with Me in paradise" (Luke 23:43). Stephen said in the hour of death: "Lord Jesus, receive my spirit" (Acts 7:59). Whoever dies in the Lord is blessed "from henceforth" (Rev. 14:13).

Here we see another problem. These are all particular examples. Nothing in the doctrine of purgatory precludes certain holy individuals from being admitted into heaven upon death. And in fact, the Catholic Church offers many means of receiving just such a grace, through indulgences. So, it is evident that the Catholic Church has no issue with the idea that at least some people go straight to heaven. Furthermore, it has always been Catholic teaching that the damned go straight to hell.

Luke 23:43 refers to the penitent thief, whose repentance at death's doorstep amounts to a baptism of desire. The Catholic Church teaches that those who are baptized are, at that moment, free from all sin. And, should they die at that moment, they go straight to heaven. Those who die with a legitimate baptism of desire have the same experience.

Acts 7:59 refers to Saint Stephen's martyrdom. The Catholic Church has always taught that legitimate martyrs do not go to purgatory and instead go straight to heaven.

With the above verses put in context, citing Rev. 14:13 loses a lot of the weight it had, especially since it is a very non-literal writing. Alone, it is insufficient to promote the idea that all souls go to either heaven or hell and nowhere else immediately upon death. In light of a passage like Matt 5:25-26, it seems it should be interpreted according to Catholic tradition.