Preheat the oven and prepare a cupcake tin with liners.

In a mixing bowl, cream together the softened butter and granulated sugar until light and fluffy.

Add the eggs one at a time, mixing well after each addition.

Stir in the limoncello and vanilla extract.

In a separate bowl, whisk together the flour, baking powder, and salt.

Gradually add the dry ingredients to the wet mixture, alternating with the milk, and mix until just combined.

Pour the batter into the prepared cupcake liners, filling them about ⅔ full.

Bake in the preheated oven for 18-20 minutes, or until a toothpick inserted comes out clean.

Allow the cupcakes to cool completely before frosting.

For the frosting, beat the softened butter until creamy, then gradually add the powdered sugar, limoncello, lemon juice, and lemon zest, mixing until light and fluffy.

Frost the cooled cupcakes with the lemon frosting.