Ingredients

• 1 2/3 cups all purpose flour
• 1/4 teaspoon baking powder
• 1/4 teaspoon salt
• 1 1/4 cups (2 1/2 sticks) unsalted butter, room temperature, divided
• 2/3 cup sugar
• 1 1/2 teaspoons vanilla extract, divided
• 1/4 teaspoon almond extract
• 1 cup powdered sugar
• 3 1/2 teaspoons (about) whole milk
• Assorted decorative candies (such as colored sugar crystals, edible glitter, and nonpareils)

Instructions

1. Sift first 3 ingredients into medium bowl. Using electric mixer, beat 1 cup butter and 2/3 cup sugar in large bowl until smooth. Beat in 1 teaspoon vanilla extract and almond extract. Beat in flour mixture until just blended. Gather dough together; divide in half. Flatten each half into disk, wrap in plastic, and chill overnight. (Can be made 2 days ahead. Keep chilled. Soften dough slightly at room temperature before rolling out.)
2. Position rack in center of oven and preheat to 325°F. Line 2 large baking sheets with parchment paper. Working with 1 disk at a time, roll out on lightly floured surface to scant 1/4-inch thickness. Cut out cookies with assorted cutters. Transfer cookies to prepared baking sheets, spacing 1 inch apart. Gather scraps and roll out on lightly floured surface; cut out additional cookies. Repeat until all dough is used.
3. Bake cookies, 1 sheet at a time, until edges and bottoms are light golden, about 16 minutes. Cool on sheets 5 minutes. Transfer to rack; cool completely.
4. Sift powdered sugar into medium bowl. Using electric mixer, beat in 1/4 cup butter, 1/2 teaspoon vanilla, and enough milk by teaspoonfuls to form thick icing. Spread thinly onto cookies. Decorate as desired. Let stand until set, about 2 hours. (Can be made 3 days ahead. Store between waxed paper in airtight container at room temperature.)