diff --git a/internal/checker/nodebuilderimpl.go b/internal/checker/nodebuilderimpl.go
index 21cc1b67b6..a6dcdb9781 100644
--- a/internal/checker/nodebuilderimpl.go
+++ b/internal/checker/nodebuilderimpl.go
@@ -411,6 +411,13 @@ func (b *nodeBuilderImpl) tryReuseExistingNonParameterTypeNode(existing *ast.Typ
 	if annotationType == nil {
 		annotationType = b.getTypeFromTypeNode(existing, true)
 	}
+	if annotationType != nil && b.ch.isErrorType(annotationType) {
+		// allow "reusing" type nodes that resolve to error types
+		// those can't truly be reused but it prevents cascading errors in isolatedDeclarations
+		// for source with errors there is no guarantee to emit correct code anyway
+		// Since tryReuseExistingTypeNodeHelper is not yet implemented, directly return the existing node
+		return existing
+	}
 	if annotationType != nil && b.typeNodeIsEquivalentToType(host, t, annotationType) && b.existingTypeNodeIsNotReferenceOrIsReferenceWithCompatibleTypeArgumentCount(existing, t) {
 		result := b.tryReuseExistingTypeNodeHelper(existing)
 		if result != nil {
@@ -2006,6 +2013,15 @@ func (b *nodeBuilderImpl) serializeTypeForDeclaration(declaration *ast.Declarati
 		t = b.ch.getOptionalType(t, false)
 	}
 
+	// Try to reuse existing type annotation if present
+	if declaration != nil && declaration.Type() != nil {
+		typeAnnotation := declaration.Type()
+		reused := b.tryReuseExistingTypeNode(typeAnnotation, t, declaration, addUndefinedForParameter)
+		if reused != nil {
+			return reused
+		}
+	}
+
 	restoreFlags := b.saveRestoreFlags()
 	if t.flags&TypeFlagsUniqueESSymbol != 0 && t.symbol == symbol && (b.ctx.enclosingDeclaration == nil || core.Some(symbol.Declarations, func(d *ast.Declaration) bool {
 		return ast.GetSourceFileOfNode(d) == b.ctx.enclosingFile
diff --git a/testdata/baselines/reference/submodule/compiler/isolatedDeclarationErrorTypes1.js.diff b/testdata/baselines/reference/submodule/compiler/isolatedDeclarationErrorTypes1.js.diff
deleted file mode 100644
index bec6aaca54..0000000000
--- a/testdata/baselines/reference/submodule/compiler/isolatedDeclarationErrorTypes1.js.diff
+++ /dev/null
@@ -1,20 +0,0 @@
---- old.isolatedDeclarationErrorTypes1.js
-+++ new.isolatedDeclarationErrorTypes1.js
-@@= skipped -11, +11 lines =@@
-
- //// [isolatedDeclarationErrorTypes1.js]
- "use strict";
--// https://github.com/microsoft/TypeScript/issues/60192
- Object.defineProperty(exports, "__esModule", { value: true });
- exports.foo3 = exports.foo2 = exports.foo1 = void 0;
- const foo1 = (type) => { };
-@@= skipped -12, +11 lines =@@
-
-
- //// [isolatedDeclarationErrorTypes1.d.ts]
--import { Unresolved } from "foo";
--export declare const foo1: (type?: Unresolved) => void;
--export declare const foo2: (type?: Unresolved | undefined) => void;
-+export declare const foo1: (type?: any) => void;
-+export declare const foo2: (type?: any) => void;
- export declare const foo3: (type: Unresolved) => void;
\ No newline at end of file
diff --git a/testdata/baselines/reference/submodule/compiler/isolatedDeclarationErrorTypes1.types.diff b/testdata/baselines/reference/submodule/compiler/isolatedDeclarationErrorTypes1.types.diff
deleted file mode 100644
index f3d9de6296..0000000000
--- a/testdata/baselines/reference/submodule/compiler/isolatedDeclarationErrorTypes1.types.diff
+++ /dev/null
@@ -1,20 +0,0 @@
---- old.isolatedDeclarationErrorTypes1.types
-+++ new.isolatedDeclarationErrorTypes1.types
-@@= skipped -6, +6 lines =@@
- >Unresolved : any
-
- export const foo1 = (type?: Unresolved): void => {};
-->foo1 : (type?: Unresolved) => void
-->(type?: Unresolved): void => {} : (type?: Unresolved) => void
-+>foo1 : (type?: any) => void
-+>(type?: Unresolved): void => {} : (type?: any) => void
- >type : any
-
- export const foo2 = (type?: Unresolved | undefined): void => {};
-->foo2 : (type?: Unresolved | undefined) => void
-->(type?: Unresolved | undefined): void => {} : (type?: Unresolved | undefined) => void
-+>foo2 : (type?: any) => void
-+>(type?: Unresolved | undefined): void => {} : (type?: any) => void
- >type : any
-
- export const foo3 = (type: Unresolved): void => {};
\ No newline at end of file