Preheat oven to 375° F. Prepare muffin pan by lining with liners or spraying with non-stick cooking spray.
In a medium bowl, add flour, sugar, and butter. Using a fork, cut the butter in until you have coarse crumbs.
In another bowl, cream together cream cheese, sugar, vanilla until smooth.
In the bowl of a stand mixer (or large bowl using hand mixer), add flour, baking powder, and salt and whisk to combine. Add egg, oil, milk, cocoa powder, and red food coloring and mix until just incorporated.
Fold cream cheese mixture into the muffin batter, being careful to not overmix.
Bake at 375° F for 17-19 minutes or until toothpick inserted in center comes out clean. Allow muffins to cool in pan for about 10 minutes, then transfer to cooling rack to cool completely.
Adapted from the Red Velvet Lover's Cookbook