diff --git a/crates/ruff/resources/test/fixtures/flake8_return/RET504.py b/crates/ruff/resources/test/fixtures/flake8_return/RET504.py
index 92bd411d8d..ea156549cd 100644
--- a/crates/ruff/resources/test/fixtures/flake8_return/RET504.py
+++ b/crates/ruff/resources/test/fixtures/flake8_return/RET504.py
@@ -260,3 +260,23 @@ def nonlocal_assignment():
         nonlocal X
         X = 1
         return X
+
+
+def decorator() -> Flask:
+    app = Flask(__name__)
+
+    @app.route('/hello')
+    def hello() -> str:
+        """Hello endpoint."""
+        return 'Hello, World!'
+
+    return app
+
+
+def default():
+    y = 1
+
+    def f(x = y) -> X:
+        return x
+
+    return y
diff --git a/crates/ruff/src/rules/flake8_return/visitor.rs b/crates/ruff/src/rules/flake8_return/visitor.rs
index d8be89bdb6..9750730901 100644
--- a/crates/ruff/src/rules/flake8_return/visitor.rs
+++ b/crates/ruff/src/rules/flake8_return/visitor.rs
@@ -66,8 +66,26 @@ impl<'a> Visitor<'a> for ReturnVisitor<'a> {
                     .non_locals
                     .extend(names.iter().map(String::as_str));
             }
-            StmtKind::FunctionDef { .. } | StmtKind::AsyncFunctionDef { .. } => {
-                // Don't recurse.
+            StmtKind::FunctionDef {
+                decorator_list,
+                args,
+                returns,
+                ..
+            }
+            | StmtKind::AsyncFunctionDef {
+                decorator_list,
+                args,
+                returns,
+                ..
+            } => {
+                // Don't recurse into the body, but visit the decorators, etc.
+                for expr in decorator_list {
+                    visitor::walk_expr(self, expr);
+                }
+                if let Some(returns) = returns {
+                    visitor::walk_expr(self, returns);
+                }
+                visitor::walk_arguments(self, args);
             }
             StmtKind::Return { value } => {
                 self.stack