diff --git a/frontends/ast/genrtlil.cc b/frontends/ast/genrtlil.cc
index fd242fe2e..87e8379e9 100644
--- a/frontends/ast/genrtlil.cc
+++ b/frontends/ast/genrtlil.cc
@@ -520,6 +520,11 @@ struct AST_INTERNAL::ProcessGenerator
 			log_error("Found wire declaration in block without label at at %s:%d!\n", ast->filename.c_str(), ast->linenum);
 			break;
 
+		case AST_PARAMETER:
+		case AST_LOCALPARAM:
+			log_error("Found parameter declaration in block without label at at %s:%d!\n", ast->filename.c_str(), ast->linenum);
+			break;
+
 		case AST_TCALL:
 		case AST_FOR:
 			break;
diff --git a/frontends/ast/simplify.cc b/frontends/ast/simplify.cc
index 6cda7235e..24e96f074 100644
--- a/frontends/ast/simplify.cc
+++ b/frontends/ast/simplify.cc
@@ -1013,7 +1013,7 @@ bool AstNode::simplify(bool const_fold, bool at_zero, bool in_lvalue, int stage,
 
 		std::vector<AstNode*> new_children;
 		for (size_t i = 0; i < children.size(); i++)
-			if (children[i]->type == AST_WIRE) {
+			if (children[i]->type == AST_WIRE || children[i]->type == AST_PARAMETER || children[i]->type == AST_LOCALPARAM) {
 				children[i]->simplify(false, false, false, stage, -1, false, false);
 				current_ast_mod->children.push_back(children[i]);
 				current_scope[children[i]->str] = children[i];
@@ -1865,7 +1865,7 @@ skip_dynamic_range_lvalue_expansion:;
 		}
 
 		for (auto child : decl->children)
-			if (child->type == AST_WIRE)
+			if (child->type == AST_WIRE || child->type == AST_PARAMETER || child->type == AST_LOCALPARAM)
 			{
 				AstNode *wire = child->clone();
 				wire->str = prefix + wire->str;
@@ -1896,7 +1896,7 @@ skip_dynamic_range_lvalue_expansion:;
 			}
 
 		for (auto child : decl->children)
-			if (child->type != AST_WIRE)
+			if (child->type != AST_WIRE && child->type != AST_PARAMETER && child->type != AST_LOCALPARAM)
 			{
 				AstNode *stmt = child->clone();
 				stmt->replace_ids(prefix, replace_rules);
diff --git a/frontends/verilog/verilog_parser.y b/frontends/verilog/verilog_parser.y
index 09748eba4..863fee599 100644
--- a/frontends/verilog/verilog_parser.y
+++ b/frontends/verilog/verilog_parser.y
@@ -963,7 +963,7 @@ simple_behavioral_stmt:
 
 // this production creates the obligatory if-else shift/reduce conflict
 behavioral_stmt:
-	defattr | assert | wire_decl |
+	defattr | assert | wire_decl | param_decl | localparam_decl |
 	non_opt_delay behavioral_stmt |
 	simple_behavioral_stmt ';' | ';' |
 	hierarchical_id attr {
diff --git a/tests/simple/task_func.v b/tests/simple/task_func.v
index 9b8e26e51..36ac768ea 100644
--- a/tests/simple/task_func.v
+++ b/tests/simple/task_func.v
@@ -68,7 +68,7 @@ endmodule
 
 // -------------------------------------------------------------------
 
-module task_func_test03( input [7:0] din_a, input [7:0] din_b, output [7:0] dout_a);
+module task_func_test03(input [7:0] din_a, input [7:0] din_b, output [7:0] dout_a);
 	assign dout_a = test(din_a,din_b);
 	function [7:0] test;
 		input [7:0] a;
@@ -80,3 +80,32 @@ module task_func_test03( input [7:0] din_a, input [7:0] din_b, output [7:0] dout
 		end
 	endfunction
 endmodule
+
+// -------------------------------------------------------------------
+
+module task_func_test04(input [7:0] in, output [7:0] out1, out2, out3);
+	parameter p = 23;
+	function [7:0] test1;
+		input [7:0] i;
+		parameter p = 42;
+		begin
+			test1 = i + p;
+		end
+	endfunction
+	function [7:0] test2;
+		input [7:0] i;
+		parameter p2 = p+42;
+		begin
+			test2 = i + p2;
+		end
+	endfunction
+	function [7:0] test3;
+		input [7:0] i;
+		begin
+			test3 = i + p;
+		end
+	endfunction
+	assign out1 = test1(in);
+	assign out2 = test2(in);
+	assign out3 = test3(in);
+endmodule