Add milk, toasted chopped hazelnuts, egg, sugar, butter, Amaretto, salt, bread flour, and active dry yeast to the bread machine according to the manufacturer's directions.

Start the bread machine and let it knead and proof the dough.

Bake according to the bread machine's instructions.

Once baking is complete, remove the bread from the machine and let it cool completely on a wire rack.

Prepare the Amaretto Glaze: In a small mixing bowl, combine sifted powdered sugar and Amaretto or almond extract.

If the glaze is too thick, add 1 to 2 teaspoons of milk to achieve a drizzling consistency.

Drizzle the Amaretto Glaze over the cooled bread.

Garnish with extra toasted chopped hazelnuts or almonds, if desired.

Slice and serve.