diff --git a/crates/ide-assists/src/handlers/add_return_type.rs b/crates/ide-assists/src/handlers/add_return_type.rs
index c9022f66d1e2..7934a80bfabb 100644
--- a/crates/ide-assists/src/handlers/add_return_type.rs
+++ b/crates/ide-assists/src/handlers/add_return_type.rs
@@ -1,3 +1,4 @@
+use either::Either;
 use hir::HirDisplay;
 use syntax::{AstNode, SyntaxKind, SyntaxToken, TextRange, TextSize, ast, match_ast};
 
@@ -133,8 +134,9 @@ fn peel_blocks(mut expr: ast::Expr) -> ast::Expr {
 }
 
 fn extract_tail(ctx: &AssistContext<'_>) -> Option<(FnType, ast::Expr, InsertOrReplace)> {
-    let (fn_type, tail_expr, return_type_range, action) =
-        if let Some(closure) = ctx.find_node_at_offset::<ast::ClosureExpr>() {
+    let node = ctx.find_node_at_offset::<Either<ast::ClosureExpr, ast::Fn>>()?;
+    let (fn_type, tail_expr, return_type_range, action) = match node {
+        Either::Left(closure) => {
             let rpipe = closure.param_list()?.syntax().last_token()?;
             let rpipe_pos = rpipe.text_range().end();
 
@@ -149,9 +151,8 @@ fn extract_tail(ctx: &AssistContext<'_>) -> Option<(FnType, ast::Expr, InsertOrR
 
             let ret_range = TextRange::new(rpipe_pos, body_start);
             (FnType::Closure { wrap_expr }, tail_expr, ret_range, action)
-        } else {
-            let func = ctx.find_node_at_offset::<ast::Fn>()?;
-
+        }
+        Either::Right(func) => {
             let rparen = func.param_list()?.r_paren_token()?;
             let rparen_pos = rparen.text_range().end();
             let action = ret_ty_to_action(func.ret_type(), rparen)?;
@@ -163,7 +164,8 @@ fn extract_tail(ctx: &AssistContext<'_>) -> Option<(FnType, ast::Expr, InsertOrR
             let ret_range_end = stmt_list.l_curly_token()?.text_range().start();
             let ret_range = TextRange::new(rparen_pos, ret_range_end);
             (FnType::Function, tail_expr, ret_range, action)
-        };
+        }
+    };
     let range = ctx.selection_trimmed();
     if return_type_range.contains_range(range) {
         cov_mark::hit!(cursor_in_ret_position);
@@ -239,6 +241,24 @@ mod tests {
         );
     }
 
+    #[test]
+    fn infer_return_type_cursor_at_return_type_pos_fn_inside_closure() {
+        cov_mark::check!(cursor_in_ret_position);
+        check_assist(
+            add_return_type,
+            r#"const _: fn() = || {
+    fn foo() $0{
+        45
+    }
+};"#,
+            r#"const _: fn() = || {
+    fn foo() -> i32 {
+        45
+    }
+};"#,
+        );
+    }
+
     #[test]
     fn infer_return_type() {
         cov_mark::check!(cursor_on_tail);