For the Eggnog Cupcakes:

1. Preheat your oven to 350°F (176°C) and prepare a cupcake pan with liners.
2. In a medium-sized bowl, combine the flour, baking powder, nutmeg, and salt.
3. Cream the butter, sugar, and oil together in a large mixing bowl until light and fluffy, about 3 minutes.
4. Add eggs one at a time, mixing well after each. Stir in vanilla extract.
5. Alternate adding dry ingredients and eggnog to the batter, beginning and ending with dry ingredients. Mix just until combined.
6. Divide the batter evenly among cupcake liners, filling each just over halfway.
7. Bake for 15–18 minutes, or until a toothpick inserted into the center comes out clean. Cool completely on a wire rack.

For the Buttercream:

1. Beat butter and shortening together in a large mixing bowl until smooth.
2. Gradually mix in 2 cups of powdered sugar until combined.
3. Add 2 tablespoons of eggnog, rum extract (if using), nutmeg, and salt. Mix until smooth.
4. Add the remaining powdered sugar and mix until combined. Add the remaining eggnog and beat until fluffy.
5. Frost the cooled cupcakes with buttercream and garnish with a sprinkle of nutmeg if desired.