I searched several days for this question. I cannot sign in with Icloud in simulator. My login and password is correct, 2fa is enabled, sms is coming and all good, but Apple Sign in dont work in simulator.
After searching I found little comment on stackoverflow
//apple.stackexchange.com/questions/321365/does-ios-simulator-in-xcode-allow-appleid-sign-in
So first you need go to icloud.com and .... login, and accept f@@@ terms (facepalm)
//joxi.ru/v297BpqHZbZgMr
After this you Apple Sign in will work in simulator