Preheat oven to 350 degrees. Line a baking sheet with parchment paper or a silicone baking mat.
Use electric mixer fit with paddle attachment to cream together, butter, cream cheese and lemon zest until smooth.
Add in sugar and beat until lightened and fluffy, about 4 minutes.
Mix in vanilla extract. Then add in eggs, one at a time, scraping down sides as needed.
In a small bowl, whisk together flour, baking powdered and kosher salt. Gradually beat into butter mixture until well incorporated.
Form dough into balls about 1 1/2 tablespoons in size. Roll balls through powdered sugar and place on prepared baking sheet.
Slightly press down dough so that it forms a disc about 2 inches in diameter.
Bake for 11-13 minutes, or until cookies are set (meaning they no longer look wet or dough, they should not brown).
After cookies have cooled completely, sift powdered sugar over tops of cookies if desired.