Cream softened unsalted butter with granulated and brown sugar using a hand mixer on medium speed for about 4 minutes.

Incorporate large eggs, the extra egg yolk, and vanilla extract. Mix on medium-high for 1-2 minutes until creamy.

Sift in all-purpose flour, baking soda, baking powder, and salt. Mix on low speed for about 1 minute until no dry flour remains.

Fold in the red, white, and blue M&Ms using a spatula, and add sprinkles if desired.

Scoop tablespoon-sized balls onto a parchment-lined baking sheet, cover with plastic wrap, and refrigerate for at least 30 minutes.

Preheat the oven to 375°F (190°C) while the dough chills.

Arrange chilled dough balls on the baking sheet and gently press extra M&Ms on top. Bake for 12-14 minutes until edges are golden.

Cool the cookies on the baking sheet for 1 minute before transferring to a wire rack to cool completely.