Gather all your ingredients and tools. Preheat your oven to 350°F (175°C) and line two baking sheets with parchment paper.

In a small bowl, mix the cold cream cheese, granulated sugar, and vanilla extract. Beat with an electric mixer for about 2 minutes until fluffy. Scoop out 18 portions, flatten slightly, and freeze.

In a medium pot, combine the finely diced strawberries and 1/4 cup of sugar over medium heat. Smash the strawberries while cooking. Let it reduce to a thick jam, approximately 45 minutes.

In a medium bowl, whisk together flour, baking powder, baking soda, and salt.

In a large bowl, cream the softened butter and 1 cup of sugar on high speed for about 2 minutes until fluffy.

Add the egg and 2 teaspoons of vanilla extract. Mix until pale and fluffy, about 1-2 minutes.

Gradually add the dry ingredients to the wet mixture, mixing on low speed just until combined. Do not overmix.

Divide the dough into four parts. Flatten one part and layer it with 1/4 of the strawberry jam. Repeat with remaining dough and jam.

Shape the dough around one cream cheese disc and flatten slightly. Roll in reserved granulated sugar before placing on the baking sheet.

Bake for 11-12 minutes. Use a large cookie cutter to reshape if necessary. Let cool on the baking sheet for 10 minutes before transferring to a wire rack.