Step 1: Prepare the Dough

1. In a large bowl, beat the softened butter and granulated sugar together until the mixture becomes fluffy and light in color.
2. Add the egg and vanilla (or almond) extract, mixing until everything is well combined.
3. In a separate bowl, whisk the flour, baking powder, and salt together.
4. Gradually add the dry ingredients to the butter mixture, stirring until a smooth dough forms.
5. Divide the dough into two halves, wrap each in plastic wrap, and refrigerate for at least an hour. Chilling the dough helps it hold its shape when baked.

Step 2: Roll and Cut

1. Preheat your oven to 350°F (175°C).
2. Roll out the dough on a lightly floured surface to about ¼-inch thickness.
3. Use a square cookie cutter or a knife to cut out present-shaped cookies.
4. Place the cookies on a parchment-lined baking sheet, spaced about an inch apart.

Step 3: Bake the Cookies

1. Bake for 8-10 minutes, or until the edges are just lightly golden.
2. Let the cookies cool on the baking sheet for a few minutes, then transfer them to a wire rack to cool completely. It’s important to let them cool fully before decorating!

Step 4: Prepare the Royal Icing

1. In a medium bowl, mix the sifted powdered sugar and meringue powder together.
2. Slowly add water, one tablespoon at a time, until the icing forms soft peaks. This should take about 8-10 tablespoons of water, depending on your desired consistency.
3. Divide the icing into separate bowls and add food coloring to each. You can go for traditional holiday colors like red and green or mix it up with pastels or metallic shades.

Step 5: Decorate the Cookies

1. Outline each cookie with a piping bag and let the outline set for a few minutes. Then, flood the center with icing, using a toothpick to fill any gaps.
2. Once the base layer is dry, use contrasting colors to pipe “ribbons” and “bows” on top.
3. Add edible glitter or festive sprinkles while the icing is still wet to make your cookies shine!