diff --git a/src/services/refactors/extractMethod.ts b/src/services/refactors/extractMethod.ts
index e4fd0e85dc2..b73613350a8 100644
--- a/src/services/refactors/extractMethod.ts
+++ b/src/services/refactors/extractMethod.ts
@@ -293,14 +293,13 @@ namespace ts.refactor.extractMethod {
             }
 
             let errors: Diagnostic[];
-            let permittedJumps = PermittedJumps.Return;
             let seenLabels: Array<__String>;
 
-            visit(nodeToCheck);
+            visit(nodeToCheck, PermittedJumps.Return);
 
             return errors;
 
-            function visit(node: Node) {
+            function visit(node: Node, permittedJumps: PermittedJumps) {
                 if (errors) {
                     // already found an error - can stop now
                     return true;
@@ -351,7 +350,6 @@ namespace ts.refactor.extractMethod {
                     // do not dive into functions or classes
                     return false;
                 }
-                const savedPermittedJumps = permittedJumps;
                 if (node.parent) {
                     switch (node.parent.kind) {
                         case SyntaxKind.IfStatement:
@@ -402,7 +400,7 @@ namespace ts.refactor.extractMethod {
                         {
                             const label = (<LabeledStatement>node).label;
                             (seenLabels || (seenLabels = [])).push(label.escapedText);
-                            forEachChild(node, visit);
+                            forEachChild(node, child => visit(child, permittedJumps));
                             seenLabels.pop();
                             break;
                         }
@@ -439,11 +437,10 @@ namespace ts.refactor.extractMethod {
                         }
                         break;
                     default:
-                        forEachChild(node, visit);
+                        forEachChild(node, child => visit(child, permittedJumps));
                         break;
                 }
 
-                permittedJumps = savedPermittedJumps;
             }
         }
     }