Preheat the oven to 350°F (175°C) and line a muffin tin with cupcake liners.

In a large mixing bowl, combine the flour, sugar, baking powder, baking soda, salt, and cinnamon.

In another bowl, whisk together the oil, eggs, grated carrots, and chopped walnuts (if using).

Pour the wet ingredients into the dry ingredients and mix until just combined.

Fill each cupcake liner about 2/3 full with the batter.

Bake in the preheated oven for 20-25 minutes or until a toothpick inserted in the center comes out clean.

Remove from the oven and allow the cupcakes to cool completely on a wire rack.

In a mixing bowl, beat the softened cream cheese and butter together until smooth and creamy.

Gradually add the powdered sugar, mixing until fully incorporated.

Mix in the vanilla extract until well combined.

Once the cupcakes are completely cooled, frost them generously with the cream cheese frosting using a spatula or piping bag.

Optionally, sprinkle additional chopped walnuts or a dusting of cinnamon on top for garnish.