1 c. powdered sugar
3 oz. pkg. cream cheese, softened
1 3/4 c. all-purpose flour
1 c. chopped nuts
3/4 c. butter, softened
1 tsp. vanilla
1 tsp. lemon flavoring
1/2 tsp. nutmeg
Powdered sugar, for coating

Gradually beat sugar into butter and cream cheese until light and fluffy. Stir in vanilla and lemon flavoring. Mix flour and nutmeg into cream cheese mixture. Add nuts. Roll in 1 1/2 inch balls and place on an ungreased cookie sheet. Bake at 300 degrees for 20 to 25 minutes or until lightly brown. While hot coat with powdered sugar.