After a stock dividend, how do you calculate holding periods for capital gains taxes?

Question

The scenario is: You own a stock for six months, and then the company issues a stock dividend — the business splits into two entities.

Can you sell both stocks after 6 months and a day after the stock dividend, or do you have to wait another year to get long term capital gain treatment?

Answer 1

Stock acquired through a (non-taxable) stock dividend has the same holding period as the stock on which the dividend was paid.