diff --git a/idea/src/org/jetbrains/kotlin/idea/refactoring/introduce/extractionEngine/ExtractionData.kt b/idea/src/org/jetbrains/kotlin/idea/refactoring/introduce/extractionEngine/ExtractionData.kt
index f57341c51d0..6a8abf49abf 100644
--- a/idea/src/org/jetbrains/kotlin/idea/refactoring/introduce/extractionEngine/ExtractionData.kt
+++ b/idea/src/org/jetbrains/kotlin/idea/refactoring/introduce/extractionEngine/ExtractionData.kt
@@ -19,40 +19,29 @@ package org.jetbrains.kotlin.idea.refactoring.introduce.extractionEngine
 import com.intellij.psi.PsiElement
 import org.jetbrains.kotlin.descriptors.DeclarationDescriptor
 import org.jetbrains.kotlin.resolve.calls.model.ResolvedCall
-import org.jetbrains.kotlin.psi.JetFile
 import com.intellij.openapi.project.Project
-import org.jetbrains.kotlin.psi.JetExpression
 import com.intellij.openapi.util.TextRange
 import kotlin.properties.Delegates
 import java.util.HashMap
 import org.jetbrains.kotlin.idea.codeInsight.JetFileReferencesResolver
-import org.jetbrains.kotlin.psi.JetSimpleNameExpression
 import org.jetbrains.kotlin.resolve.BindingContext
 import org.jetbrains.kotlin.idea.codeInsight.DescriptorToSourceUtilsIde
 import java.util.Collections
-import org.jetbrains.kotlin.psi.JetBlockExpression
-import org.jetbrains.kotlin.psi.JetQualifiedExpression
 import org.jetbrains.kotlin.psi.psiUtil.isInsideOf
 import java.util.ArrayList
 import com.intellij.psi.PsiNamedElement
-import org.jetbrains.kotlin.psi.JetSuperExpression
 import org.jetbrains.kotlin.descriptors.ClassDescriptor
 import org.jetbrains.kotlin.resolve.scopes.receivers.ThisReceiver
 import org.jetbrains.kotlin.descriptors.ClassKind
-import org.jetbrains.kotlin.psi.JetDeclaration
-import org.jetbrains.kotlin.psi.JetDeclarationWithBody
-import org.jetbrains.kotlin.psi.JetUserType
 import org.jetbrains.kotlin.resolve.calls.model.VariableAsFunctionResolvedCall
 import org.jetbrains.kotlin.descriptors.ValueParameterDescriptor
-import org.jetbrains.kotlin.psi.JetPsiFactory
-import org.jetbrains.kotlin.psi.JetFunctionLiteral
-import org.jetbrains.kotlin.psi.JetClassInitializer
 import org.jetbrains.kotlin.resolve.calls.callUtil.getResolvedCall
 import org.jetbrains.kotlin.resolve.DescriptorToSourceUtils
 import org.jetbrains.kotlin.idea.util.psi.patternMatching.JetPsiRange
 import org.jetbrains.kotlin.psi.psiUtil.getStrictParentOfType
 import org.jetbrains.kotlin.idea.refactoring.compareDescriptors
 import org.jetbrains.kotlin.resolve.DescriptorUtils
+import org.jetbrains.kotlin.psi.*
 
 data class ExtractionOptions(
         val inferUnitTypeForUnusedValues: Boolean = true,
@@ -127,6 +116,7 @@ data class ExtractionData(
 
             for ((ref, context) in JetFileReferencesResolver.resolve(originalFile, getExpressions())) {
                 if (ref !is JetSimpleNameExpression) continue
+                if (ref.getParent() is JetValueArgumentName) continue
 
                 val resolvedCall = ref.getResolvedCall(context)?.let {
                     (it as? VariableAsFunctionResolvedCall)?.functionCall ?: it
diff --git a/idea/testData/refactoring/extractFunction/parameters/misc/namedArguments.kt b/idea/testData/refactoring/extractFunction/parameters/misc/namedArguments.kt
new file mode 100644
index 00000000000..01143f98796
--- /dev/null
+++ b/idea/testData/refactoring/extractFunction/parameters/misc/namedArguments.kt
@@ -0,0 +1,9 @@
+// PARAM_TYPES: kotlin.String
+// PARAM_DESCRIPTOR: val a: kotlin.String defined in main
+
+fun main(args: Array<String>) {
+    val a = "sdfsf"
+    <selection>a.def(a = 1, b = "")</selection>
+}
+
+fun String.def(a: Int = 1, b: String) {}
\ No newline at end of file
diff --git a/idea/testData/refactoring/extractFunction/parameters/misc/namedArguments.kt.after b/idea/testData/refactoring/extractFunction/parameters/misc/namedArguments.kt.after
new file mode 100644
index 00000000000..f34c43e3900
--- /dev/null
+++ b/idea/testData/refactoring/extractFunction/parameters/misc/namedArguments.kt.after
@@ -0,0 +1,13 @@
+// PARAM_TYPES: kotlin.String
+// PARAM_DESCRIPTOR: val a: kotlin.String defined in main
+
+fun main(args: Array<String>) {
+    val a = "sdfsf"
+    __dummyTestFun__(a)
+}
+
+private fun __dummyTestFun__(a: String) {
+    a.def(a = 1, b = "")
+}
+
+fun String.def(a: Int = 1, b: String) {}
\ No newline at end of file
diff --git a/idea/tests/org/jetbrains/kotlin/idea/refactoring/introduce/JetExtractionTestGenerated.java b/idea/tests/org/jetbrains/kotlin/idea/refactoring/introduce/JetExtractionTestGenerated.java
index decc4fac77b..97fb93a4294 100644
--- a/idea/tests/org/jetbrains/kotlin/idea/refactoring/introduce/JetExtractionTestGenerated.java
+++ b/idea/tests/org/jetbrains/kotlin/idea/refactoring/introduce/JetExtractionTestGenerated.java
@@ -1732,6 +1732,12 @@ public class JetExtractionTestGenerated extends AbstractJetExtractionTest {
                     doExtractFunctionTest(fileName);
                 }
 
+                @TestMetadata("namedArguments.kt")
+                public void testNamedArguments() throws Exception {
+                    String fileName = JetTestUtils.navigationMetadata("idea/testData/refactoring/extractFunction/parameters/misc/namedArguments.kt");
+                    doExtractFunctionTest(fileName);
+                }
+
                 @TestMetadata("qualifiedAnnotation.kt")
                 public void testQualifiedAnnotation() throws Exception {
                     String fileName = JetTestUtils.navigationMetadata("idea/testData/refactoring/extractFunction/parameters/misc/qualifiedAnnotation.kt");