Heat oven to 350°F. Line two baking sheets with parchment.
Beat butter and cream cheese in a large bowl until light and creamy.
Mix in confectioners' sugar, lemon zest, vanilla, lemon juice, and salt until smooth.
Add flour and cornstarch. Stir on low just until no dry spots remain.
Chill the dough for 20 minutes to firm slightly for easier rolling.
Scoop 1-tablespoon portions, roll into smooth balls, and place 1 inch apart on sheets.
Bake 12–14 minutes, until set and just lightly golden on the bottoms.
Stir the coating sugar with the extra lemon zest in a shallow bowl.
Cool cookies 5 minutes on the sheet, then roll gently in the sugar.
Let cool completely and roll once more for a snowy finish.