diff --git a/compiler/frontend/src/org/jetbrains/kotlin/resolve/calls/inference/BuilderInferenceSession.kt b/compiler/frontend/src/org/jetbrains/kotlin/resolve/calls/inference/BuilderInferenceSession.kt
index b34a8f1d6aa..adc088fe90c 100644
--- a/compiler/frontend/src/org/jetbrains/kotlin/resolve/calls/inference/BuilderInferenceSession.kt
+++ b/compiler/frontend/src/org/jetbrains/kotlin/resolve/calls/inference/BuilderInferenceSession.kt
@@ -94,7 +94,7 @@ class BuilderInferenceSession(
             return subResolvedAtoms?.any { it.hasPostponed() } == true
         }
 
-        if (!candidate.isSuitableForBuilderInference()) {
+        if (!candidate.resolvedCall.isSuitableForBuilderInference()) {
             return true
         }
 
@@ -108,13 +108,18 @@ class BuilderInferenceSession(
         } || candidate.getSubResolvedAtoms().any { it.hasPostponed() }
     }
 
-    private fun KotlinResolutionCandidate.isSuitableForBuilderInference(): Boolean {
-        val extensionReceiver = resolvedCall.extensionReceiverArgument
-        val dispatchReceiver = resolvedCall.dispatchReceiverArgument
+    private fun ResolvedCallAtom.isSuitableForBuilderInference(): Boolean {
+        val extensionReceiver = extensionReceiverArgument
+        val dispatchReceiver = dispatchReceiverArgument
+        val resolvedAtoms = subResolvedAtoms
+
         return when {
+            resolvedAtoms != null && resolvedAtoms.map { it.atom }.filterIsInstance<SubKotlinCallArgument>().any {
+                it.callResult.resultCallAtom.isSuitableForBuilderInference()
+            } -> true
             extensionReceiver == null && dispatchReceiver == null -> false
             dispatchReceiver?.receiver?.stableType?.containsStubType() == true -> true
-            extensionReceiver?.receiver?.stableType?.containsStubType() == true -> resolvedCall.candidateDescriptor.hasBuilderInferenceAnnotation()
+            extensionReceiver?.receiver?.stableType?.containsStubType() == true -> candidateDescriptor.hasBuilderInferenceAnnotation()
             else -> false
         }
     }
diff --git a/compiler/testData/codegen/box/inference/builderInference/kt42139.kt b/compiler/testData/codegen/box/inference/builderInference/kt42139.kt
index b3a90d36533..dc55f6a5600 100644
--- a/compiler/testData/codegen/box/inference/builderInference/kt42139.kt
+++ b/compiler/testData/codegen/box/inference/builderInference/kt42139.kt
@@ -11,12 +11,12 @@ fun f1(): Sequence<List<Int>> = sequence {
 }
 
 fun f2(): Sequence<List<Int>> = sequence {
-    select(<!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER!>yield<!>(<!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER!>myEmptyList<!>()), yield(<!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER!>myEmptyList<!>()))
+    select(yield(myEmptyList()), yield(myEmptyList()))
 }
 
 fun f3(): Sequence<List<Int>> = sequence {
-    if (true) <!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER!>yield<!>(<!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER!>myEmptyList<!>()) // [NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER] Not enough information to infer type variable T
-    else yield(<!NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER!>myEmptyList<!>()) // [NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER] Not enough information to infer type variable T
+    if (true) yield(myEmptyList()) // [NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER] Not enough information to infer type variable T
+    else yield(myEmptyList()) // [NEW_INFERENCE_NO_INFORMATION_FOR_PARAMETER] Not enough information to infer type variable T
 }
 
 fun box(): String {