Preheat oven to 350°F (175°C) and line a baking sheet with parchment paper.
In a large bowl, beat butter and sweetener together until light and fluffy.
Add egg, vanilla, and almond extract; mix until smooth.
In another bowl, whisk almond flour, coconut flour, baking powder, and salt.
Gradually combine dry ingredients with the wet until a soft dough forms.
Wrap the dough in plastic wrap and chill for 20–30 minutes.
Scoop dough into 1.5 tbsp-sized balls, flatten slightly, and place on the baking sheet.
Bake for 10–12 minutes until edges are just golden.
Cool cookies completely on the sheet, then transfer to a rack.
For frosting, beat cream cheese and butter until creamy.
Add erythritol and vanilla, mix until fluffy.
Tint with food coloring if desired.
Spread frosting on cooled cookies and top with sugar-free sprinkles.