Whisk the flour, baking powder, and salt together in a large bowl. Set aside.

In a large bowl using a handheld or stand mixer fitted with a paddle attachment, beat the butter and cream cheese together on medium-high speed until completely smooth and creamy, about 2 minutes. Add the granulated sugar and beat until mixture is fluffy and combined, about 1 minute. Add the egg, vanilla extract, and almond extract and beat on high speed until combined, about 1 minute. Scrape down the sides and up the bottom of the bowl and beat again as needed to combine.

Add the dry ingredients to the wet ingredients and mix on low speed until combined. Dough will be very soft and creamy.

Generously flour your hands and rolling pin. Divide the dough into 2 equal parts. Roll each portion out on a lightly floured piece of parchment paper or silicone baking mat to about 1/4-inch thickness. The rolled-out dough can be any shape, as long as it is evenly 1/4-inch thick.

Lightly dust one of the rolled-out doughs with flour. Place a piece of parchment on top. (This prevents sticking.) Place the 2nd rolled-out dough on top. Cover with plastic wrap or aluminum foil, then refrigerate for at least 2 hours and up to 2 days.

Once chilled, preheat oven to 350°F (177°C). Line 2-3 large baking sheets with parchment paper or silicone baking mats. Carefully remove the top dough piece from the refrigerator. If it’s sticking to the bottom, run your hand under it to help remove it. Using a cookie cutter, cut the dough into shapes. (I like these heart cookie cutters.) Re-roll the remaining dough and continue cutting until all is used. Repeat with 2nd piece of dough. Note: It doesn’t seem like a lot of dough, but you get a lot of cookies from the dough scraps you re-roll.

Arrange cookies on baking sheets 3 inches apart. Bake for 12-13 minutes until very lightly browned around the edges. If your oven has hot spots, rotate the baking sheet halfway through bake time. Allow cookies to cool on the baking sheet for 5 minutes then transfer to a wire rack to cool completely before decorating. I like to decorate the cookies directly on baking sheets so I can stick the entire baking sheet in the refrigerator to help set the Nutella glaze. If you’d like to do it that way, place the cooled cookies back on baking sheets.

In a medium bowl using a handheld mixer or stand mixer fitted with a whisk attachment, beat all of the ingredients together on medium-high speed until creamy and smooth, about 2 minutes. Taste. Add another pinch of salt if frosting is too sweet. Spread on each cooled cookie then decorate with hazelnuts, if desired. Nutella glaze will set at room temperature after 3-4 hours and even quicker in the refrigerator, about 1 hour.

Cookies stay fresh covered at room temperature for up to 3 days or in the refrigerator for up to 1 week.