diff --git a/integration/dockerfiles/Dockerfile_test_issue_1039 b/integration/dockerfiles/Dockerfile_test_issue_1039
new file mode 100644
index 0000000000..f70ec01224
--- /dev/null
+++ b/integration/dockerfiles/Dockerfile_test_issue_1039
@@ -0,0 +1,10 @@
+FROM registry.access.redhat.com/ubi7/ubi:7.7-214
+
+# Install GCC, GCC-C++ and make libraries for build environment
+# Then clean caches
+RUN yum --disableplugin=subscription-manager update -y \
+    && yum --disableplugin=subscription-manager install -y \
+        gcc-4.8.5-39.el7 \
+        gcc-c++-4.8.5-39.el7 \
+        make-3.82-24.el7 \
+    && yum --disableplugin=subscription-manager clean all
diff --git a/pkg/filesystem/resolve.go b/pkg/filesystem/resolve.go
new file mode 100644
index 0000000000..94b62de942
--- /dev/null
+++ b/pkg/filesystem/resolve.go
@@ -0,0 +1,158 @@
+/*
+Copyright 2020 Google LLC
+
+Licensed under the Apache License, Version 2.0 (the "License");
+you may not use this file except in compliance with the License.
+You may obtain a copy of the License at
+
+    http://www.apache.org/licenses/LICENSE-2.0
+
+Unless required by applicable law or agreed to in writing, software
+distributed under the License is distributed on an "AS IS" BASIS,
+WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+See the License for the specific language governing permissions and
+limitations under the License.
+*/
+
+package filesystem
+
+import (
+	"os"
+	"path/filepath"
+
+	"github.com/GoogleContainerTools/kaniko/pkg/util"
+	"github.com/pkg/errors"
+	"github.com/sirupsen/logrus"
+)
+
+// ResolvePaths takes a slice of file paths and a slice of whitelist entries. It resolve each
+// file path according to a set of rules and then returns a slice of resolved paths or error.
+// File paths are resolved according to the following rules:
+// * If path is whitelisted, skip it.
+// * If path is a symlink, resolve it's ancestor link and add it to the output set.
+// * If path is a symlink, resolve it's target. If the target is not whitelisted add it to the
+// output set.
+// * Add all ancestors of each path to the output set.
+func ResolvePaths(paths []string, wl []util.WhitelistEntry) (pathsToAdd []string, err error) {
+	logrus.Info("Resolving paths")
+
+	fileSet := make(map[string]bool)
+
+	for _, f := range paths {
+		// If the given path is part of the whitelist ignore it
+		if util.IsInProvidedWhitelist(f, wl) {
+			logrus.Debugf("path %s is whitelisted, ignoring it", f)
+			continue
+		}
+
+		link, e := resolveSymlinkAncestor(f)
+		if e != nil {
+			err = e
+			return
+		}
+
+		if f != link {
+			logrus.Tracef("updated link %s to %s", f, link)
+		}
+
+		if !fileSet[link] {
+			pathsToAdd = append(pathsToAdd, link)
+		}
+		fileSet[link] = true
+
+		var evaled string
+
+		// If the path is a symlink we need to also consider the target of that
+		// link
+		evaled, err = filepath.EvalSymlinks(f)
+		if err != nil {
+			if !os.IsNotExist(err) {
+				logrus.Errorf("couldn't eval %s with link %s", f, link)
+				return
+			}
+
+			logrus.Debugf("symlink path %s, target does not exist", f)
+		}
+
+		// If the given path is a symlink and the target is part of the whitelist
+		// ignore the target
+		if util.IsInProvidedWhitelist(evaled, wl) {
+			logrus.Debugf("path %s is whitelisted, ignoring it", evaled)
+			continue
+		}
+
+		if !fileSet[evaled] {
+			pathsToAdd = append(pathsToAdd, evaled)
+		}
+		fileSet[evaled] = true
+	}
+
+	// Also add parent directories to keep the permission of them correctly.
+	pathsToAdd = filesWithParentDirs(pathsToAdd)
+
+	return
+}
+
+// filesWithParentDirs returns every ancestor path for each provided file path.
+// I.E. /foo/bar/baz/boom.txt => [/, /foo, /foo/bar, /foo/bar/baz, /foo/bar/baz/boom.txt]
+func filesWithParentDirs(files []string) []string {
+	filesSet := map[string]bool{}
+
+	for _, file := range files {
+		file = filepath.Clean(file)
+		filesSet[file] = true
+
+		for _, dir := range util.ParentDirectories(file) {
+			dir = filepath.Clean(dir)
+			filesSet[dir] = true
+		}
+	}
+
+	newFiles := []string{}
+	for file := range filesSet {
+		newFiles = append(newFiles, file)
+	}
+
+	return newFiles
+}
+
+// resolveSymlinkAncestor returns the ancestor link of the provided symlink path or returns the
+// the path if it is not a link. The ancestor link is the filenode whose type is a Symlink.
+// E.G /baz/boom/bar.txt links to /usr/bin/bar.txt but /baz/boom/bar.txt itself is not a link.
+// Instead /bar/boom is actually a link to /usr/bin. In this case resolveSymlinkAncestor would
+// return /bar/boom.
+func resolveSymlinkAncestor(path string) (string, error) {
+	if !filepath.IsAbs(path) {
+		return "", errors.New("dest path must be abs")
+	}
+	last := ""
+	newPath := path
+loop:
+	for newPath != "/" {
+		fi, err := os.Lstat(newPath)
+		if err != nil {
+			return "", errors.Wrap(err, "failed to lstat")
+		}
+
+		switch mode := fi.Mode(); {
+		case mode&os.ModeSymlink != 0:
+			last = filepath.Base(newPath)
+			newPath = filepath.Dir(newPath)
+		default:
+			target, err := filepath.EvalSymlinks(newPath)
+			if err != nil {
+				return "", err
+			}
+
+			if target != newPath {
+				last = filepath.Base(newPath)
+				newPath = filepath.Dir(newPath)
+			} else {
+				break loop
+			}
+		}
+	}
+
+	newPath = filepath.Join(newPath, last)
+	return filepath.Clean(newPath), nil
+}
diff --git a/pkg/filesystem/resolve_test.go b/pkg/filesystem/resolve_test.go
new file mode 100644
index 0000000000..a2a7be3a39
--- /dev/null
+++ b/pkg/filesystem/resolve_test.go
@@ -0,0 +1,185 @@
+/*
+Copyright 2020 Google LLC
+
+Licensed under the Apache License, Version 2.0 (the "License");
+you may not use this file except in compliance with the License.
+You may obtain a copy of the License at
+
+    http://www.apache.org/licenses/LICENSE-2.0
+
+Unless required by applicable law or agreed to in writing, software
+distributed under the License is distributed on an "AS IS" BASIS,
+WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+See the License for the specific language governing permissions and
+limitations under the License.
+*/
+
+package filesystem
+
+import (
+	"io/ioutil"
+	"os"
+	"path/filepath"
+	"reflect"
+	"sort"
+	"testing"
+
+	"github.com/GoogleContainerTools/kaniko/pkg/util"
+)
+
+func Test_ResolvePaths(t *testing.T) {
+	validateResults := func(
+		t *testing.T,
+		actualFiles,
+		expectedFiles []string,
+		err error,
+	) {
+		if err != nil {
+			t.Errorf("expected err to be nil but was %s", err)
+		}
+
+		// Sort so that comparison is against consistent order
+		sort.Strings(actualFiles)
+		sort.Strings(expectedFiles)
+
+		if !reflect.DeepEqual(actualFiles, expectedFiles) {
+			t.Errorf("expected files to equal %s but was %s",
+				expectedFiles, actualFiles,
+			)
+		}
+	}
+
+	t.Run("list of files", func(t *testing.T) {
+		dir, err := ioutil.TempDir("", "snapshot-test")
+		if err != nil {
+			t.Fatal(err)
+		}
+
+		defer os.RemoveAll(dir)
+
+		files := []string{
+			"/foo/bar.txt",
+			"/baz/boom.txt",
+		}
+
+		t.Run("all are symlinks", func(t *testing.T) {
+			for _, f := range files {
+				fLink := filepath.Join(dir, "link", f)
+				fTarget := filepath.Join(dir, "target", f)
+
+				if err := os.MkdirAll(filepath.Dir(fTarget), 0777); err != nil {
+					t.Fatal(err)
+				}
+
+				if err := ioutil.WriteFile(fTarget, []byte{}, 0777); err != nil {
+					t.Fatal(err)
+				}
+
+				if err := os.MkdirAll(filepath.Dir(fLink), 0777); err != nil {
+					t.Fatal(err)
+				}
+
+				if err := os.Symlink(fTarget, fLink); err != nil {
+					t.Fatal(err)
+				}
+			}
+
+			t.Run("none are whitelisted", func(t *testing.T) {
+				wl := []util.WhitelistEntry{}
+
+				inputFiles := []string{}
+				expectedFiles := []string{}
+
+				for _, f := range files {
+					link := filepath.Join(dir, "link", f)
+					expectedFiles = append(expectedFiles, link)
+					inputFiles = append(inputFiles, link)
+
+					target := filepath.Join(dir, "target", f)
+					expectedFiles = append(expectedFiles, target)
+				}
+
+				expectedFiles = filesWithParentDirs(expectedFiles)
+
+				files, err := ResolvePaths(inputFiles, wl)
+
+				validateResults(t, files, expectedFiles, err)
+			})
+
+			t.Run("some are whitelisted", func(t *testing.T) {
+				wl := []util.WhitelistEntry{
+					{
+						Path: filepath.Join(dir, "link", "baz"),
+					},
+					{
+						Path: filepath.Join(dir, "target", "foo"),
+					},
+				}
+
+				expectedFiles := []string{}
+				inputFiles := []string{}
+
+				for _, f := range files {
+					link := filepath.Join(dir, "link", f)
+					inputFiles = append(inputFiles, link)
+
+					if util.IsInProvidedWhitelist(link, wl) {
+						t.Logf("skipping %s", link)
+						continue
+					}
+
+					expectedFiles = append(expectedFiles, link)
+
+					target := filepath.Join(dir, "target", f)
+
+					if util.IsInProvidedWhitelist(target, wl) {
+						t.Logf("skipping %s", target)
+						continue
+					}
+
+					expectedFiles = append(expectedFiles, target)
+				}
+
+				link := filepath.Join(dir, "link", "zoom/")
+
+				target := filepath.Join(dir, "target", "zaam/")
+				if err := os.MkdirAll(target, 0777); err != nil {
+					t.Fatal(err)
+				}
+
+				if err := ioutil.WriteFile(filepath.Join(target, "meow.txt"), []byte{}, 0777); err != nil {
+					t.Fatal(err)
+				}
+
+				if err := os.Symlink(target, link); err != nil {
+					t.Fatal(err)
+				}
+
+				file := filepath.Join(link, "meow.txt")
+				inputFiles = append(inputFiles, file)
+
+				expectedFiles = append(expectedFiles, link)
+
+				targetFile := filepath.Join(target, "meow.txt")
+				expectedFiles = append(expectedFiles, targetFile)
+
+				expectedFiles = filesWithParentDirs(expectedFiles)
+
+				files, err := ResolvePaths(inputFiles, wl)
+
+				validateResults(t, files, expectedFiles, err)
+			})
+		})
+	})
+
+	t.Run("empty set of files", func(t *testing.T) {
+		inputFiles := []string{}
+		expectedFiles := []string{}
+
+		wl := []util.WhitelistEntry{}
+
+		files, err := ResolvePaths(inputFiles, wl)
+
+		validateResults(t, files, expectedFiles, err)
+	})
+}
diff --git a/pkg/snapshot/snapshot.go b/pkg/snapshot/snapshot.go
index 59be2f0e0c..90f06564ee 100644
--- a/pkg/snapshot/snapshot.go
+++ b/pkg/snapshot/snapshot.go
@@ -22,8 +22,10 @@ import (
 	"os"
 	"path/filepath"
 	"sort"
+	"strings"
 	"syscall"
 
+	"github.com/GoogleContainerTools/kaniko/pkg/filesystem"
 	"github.com/GoogleContainerTools/kaniko/pkg/timing"
 
 	"github.com/karrick/godirwalk"
@@ -41,11 +43,12 @@ var snapshotPathPrefix = constants.KanikoDir
 type Snapshotter struct {
 	l         *LayeredMap
 	directory string
+	whitelist []util.WhitelistEntry
 }
 
 // NewSnapshotter creates a new snapshotter rooted at d
 func NewSnapshotter(l *LayeredMap, d string) *Snapshotter {
-	return &Snapshotter{l: l, directory: d}
+	return &Snapshotter{l: l, directory: d, whitelist: util.Whitelist()}
 }
 
 // Init initializes a new snapshotter
@@ -73,12 +76,15 @@ func (s *Snapshotter) TakeSnapshot(files []string) (string, error) {
 		logrus.Info("No files changed in this command, skipping snapshotting.")
 		return "", nil
 	}
+
+	filesToAdd, err := filesystem.ResolvePaths(files, s.whitelist)
+	if err != nil {
+		return "", nil
+	}
+
 	logrus.Info("Taking snapshot of files...")
 	logrus.Debugf("Taking snapshot of files %v", files)
 
-	// Also add parent directories to keep the permission of them correctly.
-	filesToAdd := filesWithParentDirs(files)
-
 	sort.Strings(filesToAdd)
 
 	// Add files to the layered map
@@ -149,19 +155,42 @@ func (s *Snapshotter) scanFullFilesystem() ([]string, []string, error) {
 	)
 	timing.DefaultRun.Stop(timer)
 
+	filesToResolve := make([]string, 0, len(memFs))
+	for file := range memFs {
+		if strings.HasPrefix(file, "/tmp/dir") {
+			logrus.Infof("found %s", file)
+		}
+		filesToResolve = append(filesToResolve, file)
+	}
+
+	resolvedFiles, err := filesystem.ResolvePaths(filesToResolve, s.whitelist)
+	if err != nil {
+		return nil, nil, err
+	}
+
+	resolvedMemFs := make(map[string]bool)
+	for _, f := range resolvedFiles {
+		if strings.HasPrefix(f, "/tmp/dir") {
+			logrus.Infof("found again %s", f)
+		}
+		resolvedMemFs[f] = true
+	}
+
 	// First handle whiteouts
 	//   Get a list of all the files that existed before this layer
 	existingPaths := s.l.getFlattenedPathsForWhiteOut()
+
 	//   Find the delta by removing everything left in this layer.
-	for p := range memFs {
+	for p := range resolvedMemFs {
 		delete(existingPaths, p)
 	}
+
 	//   The paths left here are the ones that have been deleted in this layer.
 	filesToWhiteOut := []string{}
 	for path := range existingPaths {
 		// Only add the whiteout if the directory for the file still exists.
 		dir := filepath.Dir(path)
-		if _, ok := memFs[dir]; ok {
+		if _, ok := resolvedMemFs[dir]; ok {
 			if s.l.MaybeAddWhiteout(path) {
 				logrus.Debugf("Adding whiteout for %s", path)
 				filesToWhiteOut = append(filesToWhiteOut, path)
@@ -170,7 +199,7 @@ func (s *Snapshotter) scanFullFilesystem() ([]string, []string, error) {
 	}
 
 	filesToAdd := []string{}
-	for path := range memFs {
+	for path := range resolvedMemFs {
 		if util.CheckWhitelist(path) {
 			logrus.Tracef("Not adding %s to layer, as it's whitelisted", path)
 			continue
@@ -181,19 +210,11 @@ func (s *Snapshotter) scanFullFilesystem() ([]string, []string, error) {
 			return nil, nil, fmt.Errorf("could not check if file has changed %s %s", path, err)
 		}
 		if fileChanged {
-			// Get target file for symlinks so the symlink is not a dead link.
-			files, err := filesWithLinks(path)
-			if err != nil {
-				return nil, nil, err
-			}
-			logrus.Tracef("Adding files %s to layer, because it was changed.", files)
-			filesToAdd = append(filesToAdd, files...)
+			logrus.Tracef("Adding file %s to layer, because it was changed.", path)
+			filesToAdd = append(filesToAdd, path)
 		}
 	}
 
-	// Also add parent directories to keep their permissions correctly.
-	filesToAdd = filesWithParentDirs(filesToAdd)
-
 	sort.Strings(filesToAdd)
 	// Add files to the layered map
 	for _, file := range filesToAdd {
@@ -221,27 +242,6 @@ func writeToTar(t util.Tar, files, whiteouts []string) error {
 	return nil
 }
 
-func filesWithParentDirs(files []string) []string {
-	filesSet := map[string]bool{}
-
-	for _, file := range files {
-		file = filepath.Clean(file)
-		filesSet[file] = true
-
-		for _, dir := range util.ParentDirectories(file) {
-			dir = filepath.Clean(dir)
-			filesSet[dir] = true
-		}
-	}
-
-	newFiles := []string{}
-	for file := range filesSet {
-		newFiles = append(newFiles, file)
-	}
-
-	return newFiles
-}
-
 // filesWithLinks returns the symlink and the target path if its exists.
 func filesWithLinks(path string) ([]string, error) {
 	link, err := util.GetSymLink(path)
diff --git a/pkg/snapshot/snapshot_test.go b/pkg/snapshot/snapshot_test.go
index 67b70b9c51..cd9a0a4ff0 100644
--- a/pkg/snapshot/snapshot_test.go
+++ b/pkg/snapshot/snapshot_test.go
@@ -63,19 +63,24 @@ func TestSnapshotFSFileChange(t *testing.T) {
 		fooPath: "newbaz1",
 		batPath: "baz",
 	}
-	for _, dir := range util.ParentDirectoriesWithoutLeadingSlash(fooPath) {
-		snapshotFiles[dir] = ""
-	}
-	for _, dir := range util.ParentDirectoriesWithoutLeadingSlash(batPath) {
-		snapshotFiles[dir] = ""
-	}
-	numFiles := 0
+
+	// Their parents didn't change so they shouldn't be included
+	//for _, dir := range util.ParentDirectoriesWithoutLeadingSlash(fooPath) {
+	//        snapshotFiles[dir] = ""
+	//}
+	//for _, dir := range util.ParentDirectoriesWithoutLeadingSlash(batPath) {
+	//        snapshotFiles[dir] = ""
+	//}
+
+	actualFiles := []string{}
 	for {
 		hdr, err := tr.Next()
 		if err == io.EOF {
 			break
 		}
-		numFiles++
+
+		actualFiles = append(actualFiles, hdr.Name)
+
 		if _, isFile := snapshotFiles[hdr.Name]; !isFile {
 			t.Fatalf("File %s unexpectedly in tar", hdr.Name)
 		}
@@ -84,8 +89,8 @@ func TestSnapshotFSFileChange(t *testing.T) {
 			t.Fatalf("Contents of %s incorrect, expected: %s, actual: %s", hdr.Name, snapshotFiles[hdr.Name], string(contents))
 		}
 	}
-	if numFiles != len(snapshotFiles) {
-		t.Fatalf("Incorrect number of files were added, expected: 2, actual: %v", numFiles)
+	if len(actualFiles) != len(snapshotFiles) {
+		t.Fatalf("Incorrect number of files were added, expected: %d, actual: %d", len(snapshotFiles), len(actualFiles))
 	}
 }
 
@@ -155,17 +160,20 @@ func TestSnapshotFSChangePermissions(t *testing.T) {
 	snapshotFiles := map[string]string{
 		batPathWithoutLeadingSlash: "baz2",
 	}
-	for _, dir := range util.ParentDirectoriesWithoutLeadingSlash(batPath) {
-		snapshotFiles[dir] = ""
-	}
-	numFiles := 0
+
+	// The parents haven't changed so they shouldn't be in the tar
+	//for _, dir := range util.ParentDirectoriesWithoutLeadingSlash(batPath) {
+	//        snapshotFiles[dir] = ""
+	//}
+
+	foundFiles := []string{}
 	for {
 		hdr, err := tr.Next()
 		if err == io.EOF {
 			break
 		}
 		t.Logf("Info %s in tar", hdr.Name)
-		numFiles++
+		foundFiles = append(foundFiles, hdr.Name)
 		if _, isFile := snapshotFiles[hdr.Name]; !isFile {
 			t.Fatalf("File %s unexpectedly in tar", hdr.Name)
 		}
@@ -174,8 +182,11 @@ func TestSnapshotFSChangePermissions(t *testing.T) {
 			t.Fatalf("Contents of %s incorrect, expected: %s, actual: %s", hdr.Name, snapshotFiles[hdr.Name], string(contents))
 		}
 	}
-	if numFiles != len(snapshotFiles) {
-		t.Fatalf("Incorrect number of files were added, expected: 1, got: %v", numFiles)
+	if len(foundFiles) != len(snapshotFiles) {
+		t.Logf("expected\n%v\nto equal\n%v", foundFiles, snapshotFiles)
+		t.Fatalf("Incorrect number of files were added, expected: %d, got: %d",
+			len(snapshotFiles),
+			len(foundFiles))
 	}
 }
 
diff --git a/pkg/util/fs_util.go b/pkg/util/fs_util.go
index afd20e65b8..39edc7d856 100644
--- a/pkg/util/fs_util.go
+++ b/pkg/util/fs_util.go
@@ -83,6 +83,10 @@ type FSConfig struct {
 
 type FSOpt func(*FSConfig)
 
+func Whitelist() []WhitelistEntry {
+	return whitelist
+}
+
 func IncludeWhiteout() FSOpt {
 	return func(opts *FSConfig) {
 		opts.includeWhiteout = true
@@ -358,8 +362,12 @@ func ExtractFile(dest string, hdr *tar.Header, tr io.Reader) error {
 }
 
 func IsInWhitelist(path string) bool {
-	for _, wl := range whitelist {
-		if !wl.PrefixMatchOnly && path == wl.Path {
+	return IsInProvidedWhitelist(path, whitelist)
+}
+
+func IsInProvidedWhitelist(path string, wl []WhitelistEntry) bool {
+	for _, entry := range wl {
+		if !entry.PrefixMatchOnly && path == entry.Path {
 			return true
 		}
 	}