Pwn Dev-Team has released Ac1dSn0w beta 2 removing the copyright protected code from the tool. In addition, the new hacker camp has fixed problems related to (black screen), and have removed boot logo. The team member @imrel0ad confirmed to have fixed legal issues with the tool on twitter.
#Ac1dSn0w V1.0 beta 2 is now available! Legal issues fixed! Get it here cl.ly/CKe6
The jailbreaking community can now safely download the tool to tether jailbreak iPhone 4, iPhone 3GS, iPod touch 4G, and iPad on iOS 5.0.1 and iOS 5.0. Right now the tool does not support jailbreaking A5 powered iOS device such as iPhone 4S or iPad 2.
Since Ac1dSn0w is a tethered jailbreak, make sure that your battery doesn’t drains out. In case your iOS device battery depletes after the jailbreak, then you will have to reconnect your iPhone, iPad or iPod touch to a computer and use the Ac1dSn0w utility to reboot it.
How to Jailbreak iOS 5.0 / 5.0.1 using Ac1dSn0w Beta 2
Step 1: Download Ac1dSn0w BETA 2 for Mac OS X (Here and Mirror)
Step 2: Follow steps (2-7) from the guide posted here. Your device should now be jailbroken with Cydia installed.
Step 3: For semi-tethered jailbreak, follow the instructions posted here (just skip step 1).
After jailbreaking you device with Ac1dSn0w, you need to install afc2add in order to access your root filesystem via USB.
As a quick refresher, Acidsn0w jailbreak utility packs other advance features such as Tethered Boot, Pwned DFU mode, and Exit Recovery that helps in getting your iOS device out of Recovery Loop.
In case you face any kind of issue while jailbreaking iOS 5 or iOS 5.0.1 or face any instability issue like app not working, sound off in the comments!