First, begin by warming up your milk and ensuring it is around 100 degrees F and no higher than 115 degrees F.
Melt the unsalted butter in a pan or in the microwave in 30 second intervals. Allow the butter to slightly cool down before using.
Next, add the lukewarm milk to a bowl with the yeast and 1 tsp of sugar. Allow the mixture to sit for 10-15 minutes. It should foam up. If it does not, this means your milk’s temperature was incorrect or the yeast is old and you may need to start from the beginning.
Add the melted butter, egg and vanilla extract to the yeast and milk mixture and mix together to incorporate. These are your wet ingredients.
In a separate bowl, whisk together the flour, sugar and salt making sure to break up any lumps in the flour. Prepare a space in the middle of your flour mixture.
Next, pour the wet ingredients into the space in the middle of your dry ingredients.
Combine all of your ingredients until you form the donut dough. Knead the dough for 5-7 minutes. It should be a bit tacky but not too sticky. If the dough is too sticky add a bit more flour 1 tbsp at a time.
Next, place the prepared dough inside of a bowl and cover with a damp cloth. Let it sit in a warm place for 1 hour so the dough can rise. Test the readiness of the dough after 1 hour by poking a finger into it. If the indentation remains, it’s ready!
Sprinkle flour over a clean counter top surface. Place your dough on the counter top and punch down into it with your fist. Gently roll the dough out to about 1/2 an inch of thickness.
Next, use a 3 inch round cutter to cut 10-12 donuts out of the dough. Use a 1 inch cutter to cut out the circle in the middle of the donut.
Transfer the donuts to parchment paper and cover again with the damp cloth. I like lining a baking sheet with the parchment paper as it’s easier to move around. Let the donuts sit for 30 minutes.
Next, spray the air fryer basket with cooking oil spray. Cook at 350 degrees F for 5-6 minutes or until the top is golden brown. Make sure to leave enough space between each donut inside the air fryer. They should not be touching.
Remove your donuts from the air fryer. They may just look like bagels for now but once you add on the pink vanilla icing, they will taste amazing!
Finally, coat the donuts in pink vanilla icing. Top off with Easter sprinkles as soon as the donuts are coated with icing so the sprinkles stick and secure the Peeps marshmallow bunny in the middle of the donut.