diff --git a/source3/lib/secdesc.c b/source3/lib/secdesc.c
index b7c9fc5..7ae231d 100644
--- a/source3/lib/secdesc.c
+++ b/source3/lib/secdesc.c
@@ -602,7 +602,7 @@ NTSTATUS se_create_child_secdesc(TALLOC_CTX *ctx,
 		if (!container) {
 			new_flags = 0;
 		} else {
-			new_flags &= ~SEC_ACE_FLAG_INHERIT_ONLY;
+			new_flags &= ~(SEC_ACE_FLAG_INHERIT_ONLY|SEC_ACE_FLAG_INHERITED_ACE);
 
 			if (!(new_flags & SEC_ACE_FLAG_CONTAINER_INHERIT)) {
 				new_flags |= SEC_ACE_FLAG_INHERIT_ONLY;