Unable to hit breakpoints in VS Code using ElixirLS - How does one debug in VS Code?

Attaching debugger to code running elsewhere (e.g. in terminal iex -S mix session) is currently not supported.
In order to debug and be able to hit breakpoints you need to run your code with a debugger. In VSCode go to Run And Debug tab ans choose an appropriate launch config. Alternatively you can debug tests from Testing tab or right clicking on an icon next to test definition and selecting Debug Test.