For the cookies, preheat the oven to 350 degrees Fahrenheit. In the bowl of an electric mixer, cream together sugar, butter, eggs, sour cream and vanilla. In a separate bowl, stir together flour, baking powder, baking soda and salt. Add flour mixture to wet mixture and mix until combined. Stir in sprinkles.
Scoop dough into 1 1/2" balls and place at least 2" apart on a lightly greased or baking mat-lined cookie sheet. Lightly press dough balls down to flatten them slightly before baking. Place in the oven and bake for approximately 8 minutes. Remove from cookie sheet and allow to cool completely.
For the frosting, cream together butter, powdered sugar, and vanilla in the bowl of an electric mixer. Add milk a Tablespoon at a time to thin, while you're mixing. You'll want it to be nice and creamy and spreadable, but not runny, so add the milk very slowly, mixing in between.
Frost cookies and add sprinkles on top for garnish. Store in an air-tight container and the cookies will get really soft!