To be clear, the vast majority of people are not being asked to document that the income shown on their 1099-Ks is not taxable. Only people who get audited are asked for documentation, and even then, if you don't have documentation the determination of taxability is at the examiner's discretion. If he/she believes your explanation of the payments, they shouldn't levy any additional tax.
You can choose to just not report the 1099-K income that is non-taxable. The IRS does not require every dollar on a 1099-K to match some field on your return, and they even have an example online where you would leave some of it off your Sched C (customer gets cash back on a credit card transaction).
Personally, I think it's best to report it anyway and net it out to zero on Sched 1, Form 8949, or Sched C as previously described in this thread, and that's what I've done for myself and family members in the past. That way if anybody at the IRS does look at your return, there's at least some indication that you thought about it and made a determination that the income wasn't taxable.
I am very interested in how this will work out for our Tax-Aide sites this year. The options of reporting it as a plus and minus on Sched 1 or as a sale on Form 8949 are currently deemed to be out of scope for us, so either we will be doing a whole lot of Sched Cs, or we might have a lot of clients getting inquiry letters from the IRS. I suppose we won't really know how well this works out for 2023 until after tax season is over and we see what the IRS does.