"I understand this to mean that earnings from the removed contributions must be included in our income for the 2023 tax year,"
Correct. The IRA custodian will issue a code-P 2024 Form 1099-R with the IRA/SEP/SIMPLE box marked that will show the total amount distributed (the amount of contribution returned plus the attributable earnings) and only the attributable earnings in box 2a as taxable. You can report this on your 2023 tax return by entering this Form 1099-R into 2023 TurboTax as if you have already received the form, then in the questions that follow indicate that it is a 2024 Form 1099-R to that TurboTax knows that this form actually means taxable in 2023 and not taxable in 2022 as initially assumed.
