diff --git a/lib/compress.js b/lib/compress.js
index 8e446209..f6d6a9fb 100644
--- a/lib/compress.js
+++ b/lib/compress.js
@@ -3451,7 +3451,7 @@ Compressor.prototype.compress = function(node) {
             var changed = false;
             var parent = compressor.parent();
             var self = compressor.self();
-            var jump, merge_jump;
+            var declare_only, jump, merge_jump;
             var in_iife = in_lambda && parent && parent.TYPE == "Call" && parent.expression === self;
             var chain_if_returns = in_lambda && compressor.option("conditionals") && compressor.option("sequences");
             var multiple_if_returns = has_multiple_if_returns(statements);
@@ -3460,7 +3460,7 @@ Compressor.prototype.compress = function(node) {
                 var j = next_index(i);
                 var next = statements[j];
 
-                if (in_lambda && !next && stat instanceof AST_Return
+                if (in_lambda && declare_only && !next && stat instanceof AST_Return
                     && !(self instanceof AST_SwitchBranch)
                     && !(in_try && in_try.bfinally && in_async_generator(in_lambda))) {
                     var body = stat.value;
@@ -3493,7 +3493,7 @@ Compressor.prototype.compress = function(node) {
                             body: as_statement_array_with_return(stat.body, ab),
                         });
                         stat.alternative = make_node(AST_BlockStatement, stat, {
-                            body: as_statement_array(stat.alternative).concat(extract_functions()),
+                            body: as_statement_array(stat.alternative).concat(extract_functions(merge_jump, jump)),
                         });
                         statements[i] = stat;
                         statements[i] = stat.transform(compressor);
@@ -3502,15 +3502,17 @@ Compressor.prototype.compress = function(node) {
 
                     if (ab && !stat.alternative && next instanceof AST_Jump) {
                         var cond = stat.condition;
-                        cond = best_of_expression(cond, cond.negate(compressor), stat.body instanceof AST_BlockStatement);
+                        var preference = i + 1 == j && stat.body instanceof AST_BlockStatement;
+                        cond = best_of_expression(cond, cond.negate(compressor), preference);
                         if (cond !== stat.condition) {
                             changed = true;
                             stat = stat.clone();
                             stat.condition = cond;
-                            statements[j] = stat.body;
-                            stat.body = next;
-                            if (next === jump) jump = null;
-                            statements[i] = stat;
+                            var body = stat.body;
+                            stat.body = make_node(AST_BlockStatement, next, {
+                                body: extract_functions(true, null, j + 1),
+                            });
+                            statements.splice(i, 1, stat, body);
                             statements[i] = stat.transform(compressor);
                             continue;
                         }
@@ -3522,7 +3524,7 @@ Compressor.prototype.compress = function(node) {
                         changed = true;
                         stat = stat.clone();
                         stat.body = make_node(AST_BlockStatement, stat.body, {
-                            body: as_statement_array(stat.body).concat(extract_functions()),
+                            body: as_statement_array(stat.body).concat(extract_functions(merge_jump, jump)),
                         });
                         stat.alternative = make_node(AST_BlockStatement, stat.alternative, {
                             body: as_statement_array_with_return(stat.alternative, alt),
@@ -3551,38 +3553,26 @@ Compressor.prototype.compress = function(node) {
                     if (!stat.alternative && next instanceof AST_Return) {
                         changed = true;
                         stat = stat.clone();
-                        stat.alternative = next;
-                        if (next === jump) jump = null;
-                        statements.splice(i, 1, stat.transform(compressor));
-                        statements.splice(j, 1);
+                        stat.alternative = make_node(AST_BlockStatement, next, {
+                            body: extract_functions(true, null, j + 1),
+                        });
+                        statements[i] = stat;
+                        statements[i] = stat.transform(compressor);
                         continue;
                     }
-                    if (!stat.alternative && !next && in_lambda) {
-                        // if (foo()) return x; [ return ; ] ---> return foo() ? x : undefined;
-                        if (in_bool || value && multiple_if_returns) {
-                            changed = true;
-                            stat = stat.clone();
-                            stat.alternative = make_node(AST_Return, stat, { value: null });
-                            statements.splice(i, 1, stat.transform(compressor));
-                            continue;
-                        }
-                        // if (foo()) return bar() ? x : void 0; ---> return foo() && bar() ? x : void 0;
-                        // if (foo()) return bar() ? void 0 : x; ---> return !foo() || bar() ? void 0 : x;
-                        var or;
-                        if (value instanceof AST_Conditional
-                            && ((or = is_undefined(value.consequent, compressor))
-                                || is_undefined(value.alternative, compressor))) {
-                            changed = true;
-                            var ret = stat.body.clone();
-                            ret.value = value.clone();
-                            ret.value.condition = make_node(AST_Binary, stat, {
-                                operator: or ? "||" : "&&",
-                                left: or ? stat.condition.negate(compressor) : stat.condition,
-                                right: value.condition,
-                            });
-                            statements.splice(i, 1, ret.transform(compressor));
-                            continue;
-                        }
+                    // if (foo()) return x; [ return ; ] ---> return foo() ? x : undefined;
+                    // if (foo()) return bar() ? x : void 0; ---> return foo() && bar() ? x : void 0;
+                    // if (foo()) return bar() ? void 0 : x; ---> return !foo() || bar() ? void 0 : x;
+                    if (in_lambda && declare_only && !next && !stat.alternative && (in_bool
+                        || value && multiple_if_returns
+                        || value instanceof AST_Conditional && (is_undefined(value.consequent, compressor)
+                            || is_undefined(value.alternative, compressor)))) {
+                        changed = true;
+                        stat = stat.clone();
+                        stat.alternative = make_node(AST_Return, stat, { value: null });
+                        statements[i] = stat;
+                        statements[i] = stat.transform(compressor);
+                        continue;
                     }
                     // if (a) return b; if (c) return d; e; ---> return a ? b : c ? d : void e;
                     //
@@ -3593,22 +3583,17 @@ Compressor.prototype.compress = function(node) {
                     if (chain_if_returns && !stat.alternative
                         && (!(prev_stat = statements[prev = prev_index(i)]) && in_iife
                             || prev_stat instanceof AST_If && prev_stat.body instanceof AST_Return)
-                        && next_index(j) == statements.length && next instanceof AST_SimpleStatement) {
+                        && (!next ? !declare_only
+                            : next instanceof AST_SimpleStatement && next_index(j) == statements.length)) {
                         changed = true;
                         var exprs = [];
-                        var args = prev_stat ? trim_defns(prev, exprs) : [ i, 1 ];
                         stat = stat.clone();
                         exprs.push(stat.condition);
                         stat.condition = make_sequence(stat, exprs);
                         stat.alternative = make_node(AST_BlockStatement, next, {
-                            body: [
-                                next,
-                                make_node(AST_Return, next, { value: null }),
-                            ],
+                            body: extract_functions().concat(make_node(AST_Return, next, { value: null })),
                         });
-                        args.push(stat.transform(compressor));
-                        statements.splice(j, 1);
-                        [].splice.apply(statements, args);
+                        statements[i] = stat.transform(compressor);
                         i = prev + 1;
                         continue;
                     }
@@ -3703,17 +3688,18 @@ Compressor.prototype.compress = function(node) {
                 return true;
             }
 
-            function extract_functions() {
+            function extract_functions(mode, stop, end) {
                 var defuns = [];
                 var lexical = false;
                 var start = i + 1;
-                var end;
-                if (merge_jump) {
-                    end = statements.lastIndexOf(jump);
-                    if (end < 0) end = statements.length;
-                } else {
+                if (!mode) {
                     end = statements.length;
                     jump = null;
+                } else if (stop) {
+                    end = statements.lastIndexOf(stop);
+                } else {
+                    stop = statements[end];
+                    if (stop !== jump) jump = null;
                 }
                 var tail = statements.splice(start, end - start).filter(function(stat) {
                     if (stat instanceof AST_LambdaDefinition) {
@@ -3723,11 +3709,11 @@ Compressor.prototype.compress = function(node) {
                     if (is_lexical_definition(stat)) lexical = true;
                     return true;
                 });
-                if (merge_jump === 3) {
-                    tail.push(make_node(AST_SimpleStatement, jump.value, {
-                        body: make_sequence(jump.value, jump.value.expressions.slice(0, -1)),
+                if (mode === 3) {
+                    tail.push(make_node(AST_SimpleStatement, stop.value, {
+                        body: make_sequence(stop.value, stop.value.expressions.slice(0, -1)),
                     }));
-                    jump.value = jump.value.tail_node();
+                    stop.value = stop.value.tail_node();
                 }
                 [].push.apply(lexical ? tail : statements, defuns);
                 return tail;
@@ -3758,38 +3744,29 @@ Compressor.prototype.compress = function(node) {
             }
 
             function next_index(i) {
-                for (var j = i + 1; j < statements.length; j++) {
-                    if (!is_declaration(statements[j])) break;
+                declare_only = true;
+                for (var j = i; ++j < statements.length;) {
+                    var stat = statements[j];
+                    if (is_declaration(stat)) continue;
+                    if (stat instanceof AST_Var) {
+                        declare_only = false;
+                        continue;
+                    }
+                    break;
                 }
                 return j;
             }
 
             function prev_index(i) {
                 for (var j = i; --j >= 0;) {
-                    if (!(statements[j] instanceof AST_Var)) break;
+                    var stat = statements[j];
+                    if (stat instanceof AST_Var) continue;
+                    if (is_declaration(stat)) continue;
+                    break;
                 }
                 return j;
             }
 
-            function trim_defns(j, exprs) {
-                var args = [ j + 1, i - j ];
-                var var_defs = [];
-                while (++j < i) {
-                    var stat = statements[j];
-                    stat.remove_initializers(compressor, var_defs);
-                    stat.definitions.forEach(function(var_def) {
-                        if (!var_def.value) return;
-                        exprs.push(make_node(AST_Assign, var_def, {
-                            operator: "=",
-                            left: var_def.name.convert_symbol(AST_SymbolRef, process_to_assign),
-                            right: var_def.value,
-                        }));
-                    });
-                }
-                if (var_defs.length > 0) args.push(make_node(AST_Var, stat, { definitions: var_defs }));
-                return args;
-            }
-
             function eliminate_returns(stat, in_block) {
                 if (stat instanceof AST_Exit) {
                     var mode = match_return(stat, true);
@@ -9618,7 +9595,7 @@ Compressor.prototype.compress = function(node) {
             }
             if (var_defs.length > 0) body.push(make_node(AST_Var, self, { definitions: var_defs }));
             if (body.length > 0) {
-                body.push(self);
+                body.push(self.transform(compressor));
                 return make_node(AST_BlockStatement, self, { body: body }).optimize(compressor);
             }
         } else if (body_exprs && alt_exprs) {
diff --git a/test/compress/if_return.js b/test/compress/if_return.js
index 477e4367..7b6c6977 100644
--- a/test/compress/if_return.js
+++ b/test/compress/if_return.js
@@ -218,8 +218,64 @@ if_return_8: {
     }
 }
 
+if_return_9: {
+    options = {
+        booleans: true,
+        conditionals: true,
+        if_return: true,
+        sequences: true,
+    }
+    input: {
+        !function() {
+            if (console.log("foo"))
+                return 42;
+            var a = console.log("bar");
+        }();
+    }
+    expect: {
+        !function() {
+            var a;
+            return console.log("foo") || (a = console.log("bar"), void 0);
+        }();
+    }
+    expect_stdout: [
+        "foo",
+        "bar",
+    ]
+}
+
+if_return_10: {
+    options = {
+        booleans: true,
+        conditionals: true,
+        if_return: true,
+        sequences: true,
+    }
+    input: {
+        !function() {
+            if (console.log("foo"))
+                return 42;
+            if (console.log("bar"))
+                return null;
+            var a = console.log("baz");
+        }();
+    }
+    expect: {
+        !function() {
+            var a;
+            return console.log("foo") || !console.log("bar") && (a = console.log("baz"), void 0);
+        }();
+    }
+    expect_stdout: [
+        "foo",
+        "bar",
+        "baz",
+    ]
+}
+
 if_return_cond_void_1: {
     options = {
+        conditionals: true,
         if_return: true,
     }
     input: {
@@ -242,6 +298,7 @@ if_return_cond_void_1: {
 
 if_return_cond_void_2: {
     options = {
+        conditionals: true,
         if_return: true,
     }
     input: {
@@ -504,14 +561,88 @@ if_var_return_4: {
                 return v();
             var a = w();
             if (x())
-                return y();
+                return y(a);
             z();
         }
     }
     expect: {
         function f() {
-            return u() ? v() : (a = w(), x() ? y() : (z(), void 0));
             var a;
+            return u() ? v() : (a = w(), x() ? y(a) : (z(), void 0));
+        }
+    }
+}
+
+if_var_return_5: {
+    options = {
+        conditionals: true,
+        if_return: true,
+    }
+    input: {
+        function f() {
+            if (w())
+                return x();
+            var a = y();
+            return z(a);
+        }
+    }
+    expect: {
+        function f() {
+            var a;
+            return w() ? x() : (a = y(), z(a));
+        }
+    }
+}
+
+if_defns_return_1: {
+    options = {
+        conditionals: true,
+        if_return: true,
+        sequences: true,
+        side_effects: true,
+    }
+    input: {
+        function f() {
+            if (u())
+                return v();
+            function g() {}
+            if (w())
+                return x(g);
+            var a = y();
+            z(a);
+        }
+    }
+    expect: {
+        function f() {
+            var a;
+            return u() ? v() : w() ? x(g) : (a = y(), void z(a));
+            function g() {}
+        }
+    }
+}
+
+if_defns_return_2: {
+    options = {
+        conditionals: true,
+        if_return: true,
+    }
+    input: {
+        function f(a, b, c) {
+            if (v())
+                return a();
+            if (w())
+                return b();
+            if (x()) {
+                var d = c();
+                return y(d);
+            }
+            return z();
+        }
+    }
+    expect: {
+        function f(a, b, c) {
+            var d;
+            return v() ? a() : w() ? b() : x() ? (d = c(), y(d)) : z();
         }
     }
 }
@@ -1759,7 +1890,8 @@ issue_5584_1: {
         function f(a) {
             switch (a) {
               case 42:
-                return console.log("PASS") ? FAIL : void 0;
+                if (console.log("PASS"))
+                    return FAIL;
             }
         }
         f(42);
@@ -1899,6 +2031,7 @@ issue_5586: {
 
 issue_5587_1: {
     options = {
+        conditionals: true,
         if_return: true,
     }
     input: {
@@ -1921,6 +2054,7 @@ issue_5587_1: {
 
 issue_5587_2: {
     options = {
+        conditionals: true,
         if_return: true,
     }
     input: {