diff --git a/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/FirDataFlowAnalyzer.kt b/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/FirDataFlowAnalyzer.kt
index bc4dd31022b..504fca960bb 100644
--- a/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/FirDataFlowAnalyzer.kt
+++ b/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/FirDataFlowAnalyzer.kt
@@ -1216,9 +1216,14 @@ abstract class FirDataFlowAnalyzer<FLOW : Flow>(
     fun exitVariableAssignment(assignment: FirVariableAssignment) {
         val node = graphBuilder.exitVariableAssignment(assignment).mergeIncomingFlow()
         val property = assignment.lValue.resolvedSymbol?.fir as? FirProperty ?: return
-        // TODO: add unstable smartcast
-        if (property.isLocal || !property.isVar) {
+        if (property.isLocal || property.isVal) {
             exitVariableInitialization(node, assignment.rValue, property, assignment, hasExplicitType = false)
+        } else {
+            // TODO: add unstable smartcast for non-local var
+            val variable = variableStorage.getRealVariableWithoutUnwrappingAlias(node.flow, property.symbol, assignment)
+            if (variable != null) {
+                logicSystem.removeAllAboutVariable(node.flow, variable)
+            }
         }
         processConditionalContract(assignment)
     }
diff --git a/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/FirLocalVariableAssignmentAnalyzer.kt b/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/FirLocalVariableAssignmentAnalyzer.kt
index 8f83e10f155..8f899738464 100644
--- a/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/FirLocalVariableAssignmentAnalyzer.kt
+++ b/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/FirLocalVariableAssignmentAnalyzer.kt
@@ -12,6 +12,7 @@ import org.jetbrains.kotlin.fir.declarations.*
 import org.jetbrains.kotlin.fir.declarations.utils.referredPropertySymbol
 import org.jetbrains.kotlin.fir.expressions.*
 import org.jetbrains.kotlin.fir.references.FirNamedReference
+import org.jetbrains.kotlin.fir.references.FirReference
 import org.jetbrains.kotlin.fir.resolve.dfa.FirLocalVariableAssignmentAnalyzer.Companion.MiniFlow.Companion.join
 import org.jetbrains.kotlin.fir.symbols.impl.FirFunctionSymbol
 import org.jetbrains.kotlin.fir.visitors.FirVisitor
@@ -369,23 +370,21 @@ internal class FirLocalVariableAssignmentAnalyzer(
 
             override fun visitVariableAssignment(variableAssignment: FirVariableAssignment, data: MiniCfgData) {
                 super.visitVariableAssignment(variableAssignment, data)
-                val flow = data.flow ?: return
-                val name = (variableAssignment.lValue as? FirNamedReference)?.name ?: return
-                flow.recordAssignment(name, data)
+                if (variableAssignment.explicitReceiver != null) return
+                data.recordAssignment(variableAssignment.lValue)
             }
 
             override fun visitAssignmentOperatorStatement(assignmentOperatorStatement: FirAssignmentOperatorStatement, data: MiniCfgData) {
                 super.visitAssignmentOperatorStatement(assignmentOperatorStatement, data)
-                val flow = data.flow ?: return
                 val lhs = assignmentOperatorStatement.leftArgument as? FirQualifiedAccessExpression ?: return
                 if (lhs.explicitReceiver != null) return
-                val name = (lhs.calleeReference as? FirNamedReference)?.name ?: return
-                flow.recordAssignment(name, data)
+                data.recordAssignment(lhs.calleeReference)
             }
 
-            fun MiniFlow.recordAssignment(name: Name, data: MiniCfgData) {
-                val property = data.resolveLocalVariable(name) ?: return
-                recordAssignment(property, mutableSetOf())
+            fun MiniCfgData.recordAssignment(reference: FirReference) {
+                val name = (reference as? FirNamedReference)?.name ?: return
+                val property = resolveLocalVariable(name) ?: return
+                flow?.recordAssignment(property, mutableSetOf())
             }
 
             private fun MiniFlow.recordAssignment(property: FirProperty, visited: MutableSet<MiniFlow>) {
diff --git a/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/PreliminaryLoopVisitor.kt b/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/PreliminaryLoopVisitor.kt
index 9bdbd01cf08..bfeb29ab161 100644
--- a/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/PreliminaryLoopVisitor.kt
+++ b/compiler/fir/resolve/src/org/jetbrains/kotlin/fir/resolve/dfa/PreliminaryLoopVisitor.kt
@@ -44,6 +44,10 @@ class PreliminaryLoopVisitor {
         override fun visitVariableAssignment(variableAssignment: FirVariableAssignment, data: FirStatement?) {
             if (variableAssignment.source?.kind == KtFakeSourceElementKind.DesugaredIncrementOrDecrement) return
 
+            // Only care about local variable assignments, which never have explicit receivers. If this is a `var`
+            // property assignment, the smart cast will be unstable anyway.
+            if (variableAssignment.explicitReceiver != null) return
+
             val reference = variableAssignment.lValue as? FirNamedReference
             if (reference != null) {
                 requireNotNull(data)
diff --git a/compiler/testData/diagnostics/tests/smartCasts/implicitThisOrLocalVar.fir.kt b/compiler/testData/diagnostics/tests/smartCasts/implicitThisOrLocalVar.fir.kt
index 6bbb354caf5..7b58f63e906 100644
--- a/compiler/testData/diagnostics/tests/smartCasts/implicitThisOrLocalVar.fir.kt
+++ b/compiler/testData/diagnostics/tests/smartCasts/implicitThisOrLocalVar.fir.kt
@@ -10,7 +10,7 @@ fun Box.test() {
             other.item = null
             take<String>(<!SMARTCAST_IMPOSSIBLE!>item<!>)
             this.item = null
-            take<String>(<!SMARTCAST_IMPOSSIBLE!>item<!>)
+            take<String>(<!ARGUMENT_TYPE_MISMATCH!>item<!>)
         }
     }
 
@@ -18,7 +18,7 @@ fun Box.test() {
     myRun {
         if (item != null) {
             this.item = null
-            take<String>(<!SMARTCAST_IMPOSSIBLE!>item<!>)
+            take<String>(item)
         }
     }
 }