Ingredients:

1 cup butter or margarine, softened
1/2 cup sifted powdered sugar
2 cups all-purpose flour
1/2 cup chopped walnuts
1 tsp vanilla extract
1/4 cup plus 2 tbsp crushed hard peppermint candies
1/4 cup plus 2 tbsp sifted powdered sugar
2 tbsp cream cheese, softened
1/2 cup sifted powdered sugar
1 tsp milk

Cream butter; gradually add 1/2 cup powdered sugar, beating at medium speed until light and fluffy. Add flour, beating until smooth; stir in walnuts and vanilla. Cover and chill. Combine peppermint candy and 1/4 cup plus 2 tbsp powdered sugar; mix well. Set aside. Combine cream cheese and remaining ingredients; stir in 3 tbsp peppermint candy mixture. Shape dough into 1 inch balls; press thumb in each cookie leaving indentation. Spoon about 1/4 tsp cream cheese mixture into each indentation. Gently pinch edges together to seal; place cookies about 1 inch apart on ungreased cookie sheets. Bake at 350° for 12 to 15 minutes. Transfer to wire rack to cool slightly. Roll cookies in remaining peppermint candy mixture and cool completely. Makes 3 1/2 dozen.