diff --git a/plugins/kotlin/idea/tests/test/org/jetbrains/kotlin/idea/refactoring/introduce/AbstractExtractionTest.kt b/plugins/kotlin/idea/tests/test/org/jetbrains/kotlin/idea/refactoring/introduce/AbstractExtractionTest.kt
index c9679f1baece..5ff2a1a5423c 100644
--- a/plugins/kotlin/idea/tests/test/org/jetbrains/kotlin/idea/refactoring/introduce/AbstractExtractionTest.kt
+++ b/plugins/kotlin/idea/tests/test/org/jetbrains/kotlin/idea/refactoring/introduce/AbstractExtractionTest.kt
@@ -312,7 +312,7 @@ abstract class AbstractExtractionTest : KotlinLightCodeInsightFixtureTestCase()
     }
 
     protected open fun doIntroducePropertyTest(unused: String) {
-        doTest { file ->
+        doTestIfNotDisabledByFileDirective { file ->
             file as KtFile
 
             val extractionTarget = propertyTargets.single {
diff --git a/plugins/kotlin/idea/tests/test/org/jetbrains/kotlin/idea/refactoring/introduce/ExtractionTestGenerated.java b/plugins/kotlin/idea/tests/test/org/jetbrains/kotlin/idea/refactoring/introduce/ExtractionTestGenerated.java
index 696ffa9cb3da..531b8a7c1f18 100644
--- a/plugins/kotlin/idea/tests/test/org/jetbrains/kotlin/idea/refactoring/introduce/ExtractionTestGenerated.java
+++ b/plugins/kotlin/idea/tests/test/org/jetbrains/kotlin/idea/refactoring/introduce/ExtractionTestGenerated.java
@@ -3235,6 +3235,11 @@ public abstract class ExtractionTestGenerated extends AbstractExtractionTest {
                 runTest("testData/refactoring/introduceProperty/extractWithParams.kt");
             }
 
+            @TestMetadata("functionalType.kt")
+            public void testFunctionalType() throws Exception {
+                runTest("testData/refactoring/introduceProperty/functionalType.kt");
+            }
+
             @TestMetadata("kt21530.kt")
             public void testKt21530() throws Exception {
                 runTest("testData/refactoring/introduceProperty/kt21530.kt");
diff --git a/plugins/kotlin/idea/tests/testData/refactoring/introduceProperty/functionalType.kt b/plugins/kotlin/idea/tests/testData/refactoring/introduceProperty/functionalType.kt
new file mode 100644
index 000000000000..e506eac53aab
--- /dev/null
+++ b/plugins/kotlin/idea/tests/testData/refactoring/introduceProperty/functionalType.kt
@@ -0,0 +1,11 @@
+// EXTRACTION_TARGET: property with initializer
+
+fun foo(p: (String) -> Boolean) {
+
+}
+
+fun bar() {
+    foo <selection>{ it.isBlank() }</selection>
+}
+
+// IGNORE_K1
\ No newline at end of file
diff --git a/plugins/kotlin/idea/tests/testData/refactoring/introduceProperty/functionalType.kt.after b/plugins/kotlin/idea/tests/testData/refactoring/introduceProperty/functionalType.kt.after
new file mode 100644
index 000000000000..404eb19ede5b
--- /dev/null
+++ b/plugins/kotlin/idea/tests/testData/refactoring/introduceProperty/functionalType.kt.after
@@ -0,0 +1,13 @@
+// EXTRACTION_TARGET: property with initializer
+
+fun foo(p: (String) -> Boolean) {
+
+}
+
+private val function: (String) -> Boolean = { it.isBlank() }
+
+fun bar() {
+    foo(function)
+}
+
+// IGNORE_K1
\ No newline at end of file
diff --git a/plugins/kotlin/refactorings/kotlin.refactorings.common/src/org/jetbrains/kotlin/idea/refactoring/introduce/extractionEngine/ExtractFunctionGenerator.kt b/plugins/kotlin/refactorings/kotlin.refactorings.common/src/org/jetbrains/kotlin/idea/refactoring/introduce/extractionEngine/ExtractFunctionGenerator.kt
index 89428ccc1e26..08af5e7919c5 100644
--- a/plugins/kotlin/refactorings/kotlin.refactorings.common/src/org/jetbrains/kotlin/idea/refactoring/introduce/extractionEngine/ExtractFunctionGenerator.kt
+++ b/plugins/kotlin/refactorings/kotlin.refactorings.common/src/org/jetbrains/kotlin/idea/refactoring/introduce/extractionEngine/ExtractFunctionGenerator.kt
@@ -12,6 +12,8 @@ import org.jetbrains.kotlin.analysis.api.KtAllowAnalysisOnEdt
 import org.jetbrains.kotlin.analysis.api.analyze
 import org.jetbrains.kotlin.analysis.api.lifetime.allowAnalysisFromWriteAction
 import org.jetbrains.kotlin.analysis.api.lifetime.allowAnalysisOnEdt
+import org.jetbrains.kotlin.analysis.api.types.KtFunctionalType
+import org.jetbrains.kotlin.analysis.api.types.KtUsualClassType
 import org.jetbrains.kotlin.idea.base.codeInsight.ShortenReferencesFacility
 import org.jetbrains.kotlin.idea.base.psi.isMultiLine
 import org.jetbrains.kotlin.idea.base.psi.moveInsideParenthesesAndReplaceWith
@@ -645,7 +647,9 @@ abstract class ExtractFunctionGenerator<KotlinType, ExtractionResult : IExtracti
 
             val returnType = descriptor.returnType
             val presentation = typeDescriptor.renderType(returnType, isReceiver = false, Variance.OUT_VARIANCE)
-            if (typeDescriptor.unitType == returnType || with(typeDescriptor) { returnType.isError() } || extractionTarget == ExtractionTarget.PROPERTY_WITH_INITIALIZER) {
+            if (typeDescriptor.unitType == returnType ||
+                with(typeDescriptor) { returnType.isError() } ||
+                extractionTarget == ExtractionTarget.PROPERTY_WITH_INITIALIZER && returnType !is KtFunctionalType) {
                 noReturnType()
             } else {
                 returnType(presentation)
diff --git a/plugins/kotlin/refactorings/kotlin.refactorings.tests.k2/test/org/jetbrains/kotlin/idea/k2/refactoring/introduce/K2IntroducePropertyTestGenerated.java b/plugins/kotlin/refactorings/kotlin.refactorings.tests.k2/test/org/jetbrains/kotlin/idea/k2/refactoring/introduce/K2IntroducePropertyTestGenerated.java
index d6b707dca863..1fefc91dbc72 100644
--- a/plugins/kotlin/refactorings/kotlin.refactorings.tests.k2/test/org/jetbrains/kotlin/idea/k2/refactoring/introduce/K2IntroducePropertyTestGenerated.java
+++ b/plugins/kotlin/refactorings/kotlin.refactorings.tests.k2/test/org/jetbrains/kotlin/idea/k2/refactoring/introduce/K2IntroducePropertyTestGenerated.java
@@ -277,6 +277,11 @@ public abstract class K2IntroducePropertyTestGenerated extends AbstractK2Introdu
             runTest("../../idea/tests/testData/refactoring/introduceProperty/extractWithParams.kt");
         }
 
+        @TestMetadata("functionalType.kt")
+        public void testFunctionalType() throws Exception {
+            runTest("../../idea/tests/testData/refactoring/introduceProperty/functionalType.kt");
+        }
+
         @TestMetadata("kt21530.kt")
         public void testKt21530() throws Exception {
             runTest("../../idea/tests/testData/refactoring/introduceProperty/kt21530.kt");