That's a stock dividend.  Usually stock dividends aren't a taxable event, it just affects the basis of the shares.  If you owned 10 shares you paid $100 for, you get a stock dividend of 1 share.  The per share basis goes from $10/sh to $9.09/sh (11 shares/$100).

There are exceptions that can create a taxable event.  Like if the shareholder chooses to receive add'l shares in lieu of cash, or the dividend shares affects the SH proportionate interest and some preferred stock distributions.  Refer to Sec. 305(b).