In a stand mixer, beat softened butter and powdered sugar until it's light and fluffy, about 5 minutes.
Add vanilla and room temperature egg, mix for about 1 minute on medium speed.
Incorporate dry ingredients and mix until the dough comes together.
Take about ⅓ of the dough, mix in 1-2 drops of green food coloring, and cover both doughs. Refrigerate for 1 hour (or up to 24 hours).
When ready to bake, let the dough warm up on the counter for 30 minutes.
Preheat the oven to 350°F. Roll out the dough, alternating between normal and green dyed dough.
Use cookie cutters to cut out shapes and place on a parchment-lined sheet.
Bake for 8-10 minutes until edges turn golden brown. Refrigerate unbaked cookies before baking to maintain their shape.
Let them cool on a rack after baking.