Extra Inbox
I still have “Local Folders” with “Inbox, Drafts, Templates, Sent, Archives, Junk, Trash and Outbox” and those folders are duplicates and not used. There is no way to collapse the folder or delete it.
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I notice this is a follow on question to this https://support.mozilla.org/en-US/questions/1323803
The 'Local Folders' mail account by default will have these folders: 'Junk', 'Trash' and 'Outbox' 'Trash' is required just in case you need to delete anything in 'Local Folders'. The 'Outbox' is used by all mail accounts in the event you use 'Send Later', so cannot be removed as thunderbird program needs it.
The other eg: Inbox, Sent etc was obviously created when a duplicate set for an account was created. Not sure why, but it may have occurred if you were attempting to set up a pop mail account as a deferred account ie: use 'Global Inbox'.
The 'Sent', 'Drafts' etc may also have been created because you have set up an additional identity within one your accounts - a second email address with settings eg: 'Copies & Folders', 'Junk Settings' etc to use eg: 'Sent on Local Folders.
Check each mail account to see if you have set up an additional identity which is using those 'Local Folders' folders. Right click on mail account name in Folder Pane and select 'Settings' bottom right - click on 'Manage Identities' You should have one per account - the email address - as default entry. But do you have two listed? Select the additional one and click on 'Edit' Check the 'Copies & folders' tab to see if it is sending to Local Folders account.
If you do not need or want the additional identity, then select it and click on 'Remove' click on 'Close'
Please confirm there are no additional identities using 'Local Folders'. Please confirm none of the mail accounts settings are set up to store anything in 'Local Folders'.