1In large bowl, beat butter with electric mixer on medium speed until creamy; add granulated sugar, beating until blended. Add egg, orange peel and vanilla; beat until blended. On low speed, beat in flour and salt until blended. Wrap dough in plastic wrap. Refrigerate 1 hour.
2Heat oven to 350°F. Line cookie sheet with cooking parchment paper. Shape dough into 1-inch balls. On cookie sheet, place balls 2 inches apart. Press thumb into center of each cookie to make indentation, but do not press all the way to the cookie sheet.
3Bake 12 to 15 minutes or until light golden brown. Quickly remake indentations with end of wooden spoon, if necessary. Immediately remove from cookie sheet to cooling rack; cool completely. Sprinkle with powdered sugar. Fill each thumbprint with about 1/4 measuring teaspoon of jam.