According to a tweet by MuscleNerd, iOS 5 is jailbroken and the hack is expected to work when the final version of iOS 5 is released in a few months. The jailbreak is currently a tethered jailbreak, requring you to connect your iPad to the computer each time it restarts.
The DevTeam will need to develop an untethered version of the jailbreak, hopefully the jailbreak developers are not playing their hand to early. iOS 5 is still months away and Apple certainly has time to patch the iOS 5 jailbreak exploit.
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