Preheat the oven to 350°F.
For the meatballs, in a medium bowl, combine ground beef, panko bread crumbs, parmesan cheese, garlic, milk, egg, Italian seasoning, salt, and black pepper. Mix just until combined.
Roll the meatball mixture into ½-inch balls and place in a single layer on an aluminum foil linked baking sheet pan. Bake at 350°F 15-20 minutes or until golden brown with an internal temperature of 165°F is reached.
Bring a large pot of salted water to boil. Cook the pasta until al Dente. Reserve ½ cup of the pasta water, then drain the pasta.
In a medium skillet on medium-high heat, melt two tablespoons of the butter. Once melted, add garlic and onion. Cook until translucent, about 3-4 minutes.
Stir in the tomato paste, and cook 2 minutes.
Add tomato puree, sugar, salt, pepper, remaining butter, the reserved pasta water, and parmesan cheese. Mix well and simmer on low 3-5 minutes. Add additional water to thin the sauce to your desired texture.
Fold the cooked meatballs and drained pasta into the sauce. Ladle and garnish with parmesan cheese, if desired.