The concept of God being "in us" and we being "in God" or "in Jesus" is frequent in the NT. here is a sample:
- John 14:20 - On that day you will know that I am in My Father, and you are in Me, and I am in you.
- John 15:4, 5 - Remain in Me, and I will remain in you. Just as no branch can bear fruit by itself unless it remains in the vine, neither can you bear fruit unless you remain in Me. I am the vine and you are the branches. The one who remains in Me, and I in him, will bear much fruit. For apart from Me you can do nothing.
- John 17:22, 23 - I have given them the glory You gave Me, so that they may be one as We are one— I in them and You in Me—that they may be perfectly united, so that the world may know that You sent Me and have loved them just as You have loved Me.
- John 17:26 - And I have made Your name known to them and will continue to make it known, so that the love You have for Me may be in them, and I in them.”
- Rom 8:9 - You, however, are not in the realm of the flesh but are in the realm of the Spirit, if indeed the Spirit of God lives in you. And if anyone does not have the Spirit of Christ, they do not belong to Christ.
- Rom 8:11 - And if the Spirit of Him who raised Jesus from the dead is living in you, He who raised Christ Jesus from the dead will also give life to your mortal bodies through His Spirit, who lives in you.
- 1 Cor 3:16 - Do you not know that you yourselves are God’s temple, and that God’s Spirit dwells in you?
- 1 Cor 6:19 - Do you not know that your body is a temple of the Holy Spirit who is in you, whom you have received from God? You are not your own;
- 2 Cor 13:5 - Examine yourselves to see whether you are in the faith; test yourselves. Can’t you see for yourselves that Jesus Christ is in you—unless you actually fail the test?
- Col 1:27 - To them God has chosen to make known among the Gentiles the glorious riches of this mystery, which is Christ in you, the hope of glory.
The NT often expresses this a different way with other abstract concepts as well such as faith, love, the Word, etc. Here is a sample.
- 2 Tim 1:5 - I am reminded of your sincere faith, which first dwelt in your grandmother Lois and your mother Eunice, and I am convinced is in you as well.
- 1 John 2:14 - I have written to you, fathers, because you know Him who is from the beginning. I have written to you, young men, because you are strong, and the word of God abides in you, and you have overcome the evil one.
- 1 John 2:27 - And as for you, the anointing you received from Him remains in you, and you do not need anyone to teach you. But just as His true and genuine anointing teaches you about all things, so remain in Him as you have been taught.
- 1 John 2:24 - As for you, let what you have heard from the beginning remain in you. If it does, you will also remain in the Son and in the Father.
- 2 Cor 8:7 - But just as you excel in everything—in faith, in speech, in knowledge, in complete earnestness, and in the love we inspired in you—see that you also excel in this grace of giving.
- John 15:7 - If you remain in Me and My words remain in you, ask whatever you wish, and it will be done for you.
- 1 Peter 3:15 - But in your hearts sanctify Christ as Lord. Always be prepared to give a defense to everyone who asks you the reason for the hope that is in you. But respond with gentleness and respect,
... and so forth. the Bible also talks about people having demons "in them" - that being demon possessed or "in them" was being controlled by the demon. The same is true of The Holy Spirit, Jesus, the Father, love, God's Word, etc; that which is "in us" controlled us and molds our charater and conduct. Paul observed the same this on the mars Hill in Athens when he said (Acts 17:28)
For in Him we live and move and have our being.
Jesus told His disciples during their final night together (John 13:34, 35)
A new commandment I give you: Love one another. As I have loved you,
so you also must love one another. By this everyone will know that you
are My disciples, if you love one another.”
Back to 1 John 4:12. This verse is consistent with all the others - if Jesus' love abides in us and we in Jesus, then the love we have for on another will be obviously inspired by Jesus. Jesus said something similar in Matt 5:16 -
In the same way, let your light shine before men, that they may see
your good deeds and glorify your Father in heaven.
Lastly, there is the question of what the "love of God" is; is it God's love for us, or, our love for God? I think the force of John's argument here is, if we understand God's love for us, and we respond with a reciprocating love for God, then that will manifest itself as a love for others who will recognize its divine origin - God working through us matures or perfects our love.
The Jamieson-Fausset-Brown Bible Commentary suggests this:
If we love one another, God dwelleth in us—for God is love; and it
must have been from Him dwelling in us that we drew the real love we
bear to the brethren (1Jo 4:8, 16). John discusses this in 1Jo
his love—rather, "the love of Him," that is, "to Him" (1Jo 2:5),
evinced by our love to His representatives, our brethren.
is perfected in us—John discusses this in 1Jo 4:17-19. Compare 1Jo
2:5, "is perfected," that is, attains its proper maturity.