diff --git a/compiler/backend/src/org/jetbrains/kotlin/codegen/coroutines/CoroutineTransformerMethodVisitor.kt b/compiler/backend/src/org/jetbrains/kotlin/codegen/coroutines/CoroutineTransformerMethodVisitor.kt
index d32d8816e2a..2529e1a80f2 100644
--- a/compiler/backend/src/org/jetbrains/kotlin/codegen/coroutines/CoroutineTransformerMethodVisitor.kt
+++ b/compiler/backend/src/org/jetbrains/kotlin/codegen/coroutines/CoroutineTransformerMethodVisitor.kt
@@ -73,6 +73,7 @@ class CoroutineTransformerMethodVisitor(
         // First instruction in the method node may change in case of named function
         val actualCoroutineStart = methodNode.instructions.first
 
+        var startLabelNode: LabelNode? = null
         if (isForNamedFunction) {
             ReturnUnitMethodTransformer.transform(containingClassInternalName, methodNode)
 
@@ -87,7 +88,7 @@ class CoroutineTransformerMethodVisitor(
             }
             continuationIndex = methodNode.maxLocals++
 
-            prepareMethodNodePreludeForNamedFunction(methodNode)
+            startLabelNode = prepareMethodNodePreludeForNamedFunction(methodNode)
         } else {
             ReturnUnitMethodTransformer.cleanUpReturnsUnitMarkers(methodNode, ReturnUnitMethodTransformer.findReturnsUnitMarks(methodNode))
         }
@@ -113,9 +114,9 @@ class CoroutineTransformerMethodVisitor(
             transformCallAndReturnContinuationLabel(it.index + 1, it.value, methodNode, suspendMarkerVarIndex)
         }
 
+        val defaultLabel = LabelNode()
         methodNode.instructions.apply {
             val startLabel = LabelNode()
-            val defaultLabel = LabelNode()
             val tableSwitchLabel = LabelNode()
 
             // tableswitch(this.label)
@@ -152,6 +153,27 @@ class CoroutineTransformerMethodVisitor(
 
         dropSuspensionMarkers(methodNode, suspensionPoints)
         methodNode.removeEmptyCatchBlocks()
+
+        if (isForNamedFunction) {
+            addContinuationToLvt(
+                methodNode,
+                startLabelNode.sure { "start label has not been initialized during prelude generation" },
+                defaultLabel
+            )
+        }
+    }
+
+    private fun addContinuationToLvt(methodNode: MethodNode, startLabel: LabelNode, endLabel: LabelNode) {
+        methodNode.localVariables.add(
+            LocalVariableNode(
+                "\$continuation",
+                languageVersionSettings.continuationAsmType().descriptor,
+                null,
+                startLabel,
+                endLabel,
+                continuationIndex
+            )
+        )
     }
 
     private fun removeFakeContinuationConstructorCall(methodNode: MethodNode) {
@@ -209,7 +231,7 @@ class CoroutineTransformerMethodVisitor(
         )
     }
 
-    private fun prepareMethodNodePreludeForNamedFunction(methodNode: MethodNode) {
+    private fun prepareMethodNodePreludeForNamedFunction(methodNode: MethodNode): LabelNode {
         val objectTypeForState = Type.getObjectType(classBuilderForCoroutineState.thisName)
         val continuationArgumentIndex = getLastParameterIndex(methodNode.desc, methodNode.access)
         methodNode.instructions.asSequence().filterIsInstance<VarInsnNode>().forEach {
@@ -218,6 +240,8 @@ class CoroutineTransformerMethodVisitor(
             it.`var` = continuationIndex
         }
 
+        val startLabel = LabelNode()
+
         methodNode.instructions.insert(withInstructionAdapter {
             val createStateInstance = Label()
             val afterCoroutineStateCreated = Label()
@@ -237,6 +261,7 @@ class CoroutineTransformerMethodVisitor(
             // `doResume` just before calling the suspend function (see kotlin.coroutines.experimental.jvm.internal.CoroutineImplForNamedFunction).
             // So, if it's set we're in continuation.
 
+            visitLabel(startLabel.label)
             visitVarInsn(Opcodes.ALOAD, continuationArgumentIndex)
             instanceOf(objectTypeForState)
             ifeq(createStateInstance)
@@ -288,6 +313,7 @@ class CoroutineTransformerMethodVisitor(
                 visitVarInsn(Opcodes.ASTORE, exceptionIndex)
             }
         })
+        return startLabel
     }
 
     private fun removeUnreachableSuspensionPointsAndExitPoints(methodNode: MethodNode, suspensionPoints: MutableList<SuspensionPoint>) {
diff --git a/compiler/testData/codegen/bytecodeText/coroutines/debug/continuationInLvt.kt b/compiler/testData/codegen/bytecodeText/coroutines/debug/continuationInLvt.kt
new file mode 100644
index 00000000000..05bf57da4e1
--- /dev/null
+++ b/compiler/testData/codegen/bytecodeText/coroutines/debug/continuationInLvt.kt
@@ -0,0 +1,15 @@
+// LANGUAGE_VERSION: 1.3
+
+suspend fun dummy() {}
+
+suspend fun tailCall() {
+    dummy()
+}
+
+suspend fun stateMachine() {
+    dummy()
+    dummy()
+}
+
+// for tail-calls there is no need to add continuation to LVT
+// 1 LOCALVARIABLE \$continuation Lkotlin/coroutines/Continuation; L.* 2
diff --git a/compiler/tests/org/jetbrains/kotlin/codegen/BytecodeTextTestGenerated.java b/compiler/tests/org/jetbrains/kotlin/codegen/BytecodeTextTestGenerated.java
index dead1921340..0060254d2b8 100644
--- a/compiler/tests/org/jetbrains/kotlin/codegen/BytecodeTextTestGenerated.java
+++ b/compiler/tests/org/jetbrains/kotlin/codegen/BytecodeTextTestGenerated.java
@@ -1114,6 +1114,11 @@ public class BytecodeTextTestGenerated extends AbstractBytecodeTextTest {
                 KotlinTestUtils.assertAllTestsPresentByMetadata(this.getClass(), new File("compiler/testData/codegen/bytecodeText/coroutines/debug"), Pattern.compile("^(.+)\\.kt$"), TargetBackend.ANY, true);
             }
 
+            @TestMetadata("continuationInLvt.kt")
+            public void testContinuationInLvt() throws Exception {
+                runTest("compiler/testData/codegen/bytecodeText/coroutines/debug/continuationInLvt.kt");
+            }
+
             @TestMetadata("probeCoroutineSuspended.kt")
             public void testProbeCoroutineSuspended() throws Exception {
                 runTest("compiler/testData/codegen/bytecodeText/coroutines/debug/probeCoroutineSuspended.kt");