"I told the clients the amount to put in each of their IRA's but they got them switched and put the amount for hers (which was limited) in his and vice versa."

Are you certain there cannot be a spousal allocation that resolves this?

Otherwise, you would report the excess every year until it is removed, including gain/loss.

Which type of IRA account is this? Are they able to apply the overage to the following year, instead of removing it? Because now you have two year ends gone past.