Begin by preheating your oven to 350 degrees F. Line a muffin pan with paper baking cups and set aside.
In a medium-size bowl, sift together the flour, baking soda, salt, and cocoa. Set aside. Then in a large mixing bowl (or stand mixer), combine the sugar and the eggs. Next slowly beat in the oil. To the sugar mixture, add the flour alternatively with the butter milk, beginning and ending with the flour mixture. Stir in the vanilla and food coloring. Mix until just combined.
Spoon the batter into the muffin cups, filling each cup about 2/3 fill. Bake for 18-20 minutes or until a toothpick inserted near the center of the cupcake comes out clean. Let the cupcakes cool for five minutes before removing them from the pan to cool completely.
For the frosting, cream the cream cheese and butter together. Beat in the powdered sugar until smooth. Add the vanilla and nuts and mix until combined. Spread the frosting onto the cupcakes. Decorate with patriotic sugar candies.