diff --git a/src/compiler/parser-decl-symb-init.bas b/src/compiler/parser-decl-symb-init.bas
index 8a86c8748..8a5f7b9ac 100644
--- a/src/compiler/parser-decl-symb-init.bas
+++ b/src/compiler/parser-decl-symb-init.bas
@@ -633,6 +633,7 @@ function cInitializer _
 	'' [x] top level -> allow up-casting
 	'' [x] nested UDT initialization -> do not allow up-casting
 	'' [ ] array element initialization -> allow up-casting
+	'' [x] NEW() -> allow up-casting
 
 	'' No override in options?
 	if( (options and FB_INIOPT_NOUPCAST) = 0 ) then
@@ -641,8 +642,10 @@ function cInitializer _
 		if( ctx.last_ctx = NULL ) then
 			ctx.options and= not FB_INIOPT_NOUPCAST
 
-		'' anything else, assume no upcasting
-		else
+		'' up-casting not explicitly enabled?
+		elseif( (options and FB_INIOPT_UPCAST) = 0 ) then
+
+			'' then anything else, assume no up-casting
 			ctx.options or= FB_INIOPT_NOUPCAST
 
 		end if
diff --git a/src/compiler/parser-quirk-mem.bas b/src/compiler/parser-quirk-mem.bas
index 03c584387..0021348c1 100644
--- a/src/compiler/parser-quirk-mem.bas
+++ b/src/compiler/parser-quirk-mem.bas
@@ -190,7 +190,7 @@ function cOperatorNew( ) as ASTNODE ptr
 					lexSkipToken( )
 				end if
 			else
-				initexpr = cInitializer( tmp, FB_INIOPT_ISINI or FB_INIOPT_NOUPCAST, dtype, subtype )
+				initexpr = cInitializer( tmp, FB_INIOPT_ISINI or FB_INIOPT_UPCAST, dtype, subtype )
 				if( initexpr = NULL ) then
 					errReport( FB_ERRMSG_EXPECTEDEXPRESSION )
 				end if
diff --git a/src/compiler/parser.bi b/src/compiler/parser.bi
index 2937fbe39..d38aa4406 100644
--- a/src/compiler/parser.bi
+++ b/src/compiler/parser.bi
@@ -227,6 +227,7 @@ enum FB_INIOPT
 	FB_INIOPT_ISINI             = &h00000001  '' initializer (not an expression)
 	FB_INIOPT_ISOBJ             = &h00000002  '' object with constructor
 	FB_INIOPT_NOUPCAST          = &h00000004  '' don't allow upcasting (base types initialized from derived types)
+	FB_INIOPT_UPCAST            = &h00000008  '' allow upcasting (as used by NEW() to reset the recursion checks)
 end enum
 
 '' cProcHeader() flags