diff --git a/lib/compress.js b/lib/compress.js
index 28ac7f48c2..150b554ee5 100644
--- a/lib/compress.js
+++ b/lib/compress.js
@@ -1963,6 +1963,7 @@ merge(Compressor.prototype, {
                         } else if (candidate instanceof AST_VarDef) {
                             replaced = !compressor.exposed(def) && def.references.length == def.replaced;
                         }
+                        value_def.last_ref = false;
                         value_def.single_use = false;
                     }
                     if (replaced && !remove_candidate(candidate)) statements.splice(stat_index, 1);
diff --git a/test/compress/collapse_vars.js b/test/compress/collapse_vars.js
index 36cba2a55b..071ee16284 100644
--- a/test/compress/collapse_vars.js
+++ b/test/compress/collapse_vars.js
@@ -9030,3 +9030,30 @@ issue_4868: {
     }
     expect_stdout: "PASS"
 }
+
+issue_4874: {
+    options = {
+        collapse_vars: true,
+        evaluate: true,
+        reduce_vars: true,
+        toplevel: true,
+        unused: true,
+    }
+    input: {
+        var a;
+        a = null;
+        (function(b) {
+            for (var c in b = b && b[console.log("PASS")])
+                console;
+        })(a = 42);
+    }
+    expect: {
+        var a;
+        null;
+        (function(b) {
+            for (var c in a && a[console.log("PASS")])
+                console;
+        })(a = 42);
+    }
+    expect_stdout: "PASS"
+}