These are my favorite cut-out cookies for any occasion. The cream cheese gives them a hint of richness and you can vary the extract if you like; I love the addition of almond and vanilla, but you could omit the almond and increase the vanilla if you're not an almond fan. Decorate to make YOU happy!
Yields about 12 large cookies, recipe may be doubled
4 ounces unsalted butter, softened
3 ounces cream cheese, at room temperature
1 cup powdered sugar
1/2 teaspoon baking powder
1/4 teaspoon salt
1 teaspoon vanilla
1 teaspoon almond extract
2 1/2 cups all-purpose flour
In a mixing bowl or bowl of a stand mixer, combine the butter and cream cheese. Beat on medium-high speed until well-combined, about 30-60 seconds. Add the powdered sugar, baking powder, and salt. Beat until combined, scraping down the bowl as needed. Beat in the egg and extracts until well-combined. Beat in as much flour as possible with the mixer; if you need to, mix in any remaining flour with a wooden spoon.. (If you use a stand mixer, you will probably not have to mix by hand. A hand mixer may not be able to handle a dough that stiff, making it necessary to do it by hand.)
Cover and chill for about an hour. (The dough should be easy to handle, if not chill a little longer.)
Preheat the oven to 375-degrees. Lightly flour a work surface and roll out the dough with a floured rolling pin to about 1/4-inch thick. Cut out cookies, saving and rolling out the scraps to make more cookies.
Place the cookies on an ungreased sheet pan. (If you just want to decorate with colored sugars, lightly brush the cookies with cream and sprinkle them now. Do not overly wet the dough!) Bake for 8-10 minutes, or until the edges are very lightly browned. Cool on the pan for 1 minute before transferring to a wire rack to cool completely.
Decorate as desired.