diff --git a/crates/red_knot_python_semantic/resources/mdtest/assignment/annotations.md b/crates/red_knot_python_semantic/resources/mdtest/assignment/annotations.md
index 1e912f7f248b3..923fca96ac53b 100644
--- a/crates/red_knot_python_semantic/resources/mdtest/assignment/annotations.md
+++ b/crates/red_knot_python_semantic/resources/mdtest/assignment/annotations.md
@@ -22,3 +22,13 @@ x: int = "foo"  # error: [invalid-assignment] "Object of type `Literal["foo"]` i
 x: int
 x = "foo"  # error: [invalid-assignment] "Object of type `Literal["foo"]` is not assignable to `int`"
 ```
+
+## PEP-604 annotations not yet supported
+
+```py
+def f() -> str | None:
+    return None
+
+# TODO: should be `str | None` (but Todo is better than `Unknown`)
+reveal_type(f())  # revealed: @Todo
+```
diff --git a/crates/red_knot_python_semantic/src/types.rs b/crates/red_knot_python_semantic/src/types.rs
index b953f2865119f..d445b694be249 100644
--- a/crates/red_knot_python_semantic/src/types.rs
+++ b/crates/red_knot_python_semantic/src/types.rs
@@ -211,7 +211,13 @@ fn declarations_ty<'db>(
     let declared_ty = if let Some(second) = all_types.next() {
         let mut builder = UnionBuilder::new(db).add(first);
         for other in [second].into_iter().chain(all_types) {
-            if !first.is_equivalent_to(db, other) {
+            // Make sure not to emit spurious errors relating to `Type::Todo`,
+            // since we only infer this type due to a limitation in our current model.
+            //
+            // `Unknown` is different here, since we might infer `Unknown`
+            // for one of these due to a variable being defined in one possible
+            // control-flow branch but not another one.
+            if !first.is_equivalent_to(db, other) && !first.is_todo() && !other.is_todo() {
                 conflicting.push(other);
             }
             builder = builder.add(other);
@@ -292,6 +298,10 @@ impl<'db> Type<'db> {
         matches!(self, Type::Never)
     }
 
+    pub const fn is_todo(&self) -> bool {
+        matches!(self, Type::Todo)
+    }
+
     pub const fn into_class_literal_type(self) -> Option<ClassType<'db>> {
         match self {
             Type::ClassLiteral(class_type) => Some(class_type),
diff --git a/crates/red_knot_python_semantic/src/types/infer.rs b/crates/red_knot_python_semantic/src/types/infer.rs
index f726caffea106..d2d307b7b49b9 100644
--- a/crates/red_knot_python_semantic/src/types/infer.rs
+++ b/crates/red_knot_python_semantic/src/types/infer.rs
@@ -3471,6 +3471,17 @@ impl<'db> TypeInferenceBuilder<'db> {
                 Type::Todo
             }
 
+            // TODO PEP-604 unions
+            ast::Expr::BinOp(binary) => {
+                self.infer_binary_expression(binary);
+                match binary.op {
+                    // PEP-604 unions are okay
+                    ast::Operator::BitOr => Type::Todo,
+                    // anything else is an invalid annotation:
+                    _ => Type::Unknown,
+                }
+            }
+
             // Forms which are invalid in the context of annotation expressions: we infer their
             // nested expressions as normal expressions, but the type of the top-level expression is
             // always `Type::Unknown` in these cases.
@@ -3482,10 +3493,6 @@ impl<'db> TypeInferenceBuilder<'db> {
                 self.infer_named_expression(named);
                 Type::Unknown
             }
-            ast::Expr::BinOp(binary) => {
-                self.infer_binary_expression(binary);
-                Type::Unknown
-            }
             ast::Expr::UnaryOp(unary) => {
                 self.infer_unary_expression(unary);
                 Type::Unknown