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In a large mixing bowl, beat together butter, cream cheese and sugar until fluffy. Add egg, vanilla and almond extracts; beat well.
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In a small bowl, combine flour and baking powder- gradually mix into cream cheese mixture; beat until well-mixed.
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Divide dough in half; wrap each half in plastic wrap and chill for at least 1 1/2 hours.
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When dough is done chilling, preheat oven to 375.
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Roll dough on to lightly floured surface to about 1/8"-1/4" thickness. Cut with cookie cutters. (If desired, sprinkle with colored sugars.) Place on ungreased cookie sheets.
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Bake at 375 for 8-10 minutes or until edges just slightly golden. Allow to cool 2 minutes before removing to wire racks to cool. If desired, decorate with icing or glaze.