In the bowl of a stand mixer, add all the sugar cookie ingredients EXCEPT the flour. Using the paddle attachment, mix on low until ingredients are light and fluffy.

Add in flour slowly, about 1/2 cup at a time. Continue mixing just until the dough forms as one solid ball. 

Cover the dough with plastic wrap and refrigerate for at least 1 hour.

Preheat oven to 375°F. Line a baking sheet with parchment paper.

On lightly floured surface, roll out 1/3 of the dough at a time to 1/4-1/8" thickness. Using lightly floured cookie cutters, cut out shapes and place cookies 1" apart on the baking sheet.

Bake each batch for 8-10 minutes or until lightly browned around the edges. (They will not be brown on top. Do not over bake!) Remove cookies to a cooling rack and let cool completely before frosting.

In a medium bowl (or in the stand mixer), stir the softened cream cheese and softened butter together until smooth and creamy. Stir in the vanilla.

Gradually stir in the confectioner’s sugar until frosting reaches desired consistency. Either ice the cooled cookies right away or store in refrigerator until ready to use.