Just dig into the hillside to make a flat planting area and you should be alright. If you have lots of earthworms, I would guess your soil is not so bad as you think it is. Earthworms are indicators of healthy soil.
You should check the pH of the soil and maybe amend if necessary to get the pH between 5.5 and 7, where citrus do best.

If you have worms, you are better off than me.

The first thing I would do is mulch the heck out of it. Then when I planted, I would bareroot the trees to correct for girdling and j hook roots and also to prevent soil interface problems. I have also noticed almost every container tree/shrub I plant is planted too deeply in the pot and the trunk flare is covered. Keep that basal flare above grade.

I work almost exclusively on hillsides and there are a couple issues to deal with. You really need to control waterflow. I like zigzag swales to slow down the water and make sure a lot gets into the ground. If you make crescents, remember that they will overflow with enouh water and you need to control that. Pick an overflow location by making a low spot in the crescent and reinforce that with rocks. Also remember that hills have great drainage so you will probably want a swale above the tree as well. That will give the water a place to soak in and then travel underground to the tree below.

I would be careful about just making a flat spot on a 1:1 slope, because most people just come in and cut a wedge out of the hill. That leaves an unstable vertical cut behind the planting area. I can't tell you how many dead plantings I have seen where that unstable cut or the mulch over it slid down and smothered the plant below.