Tax Basis for T/WBD Spin

Yesterday, my shares of  AT&T spun out 0.24 shares of WBD for every T share I held. I wrote an estimate of the adjusted cost basis using a logical approach - basically assuming the spinco value on Day 1 reduced my cost basis of AT&T. 

(I'd purchased AT&T at $24.06 - so assumed by cost basis was 76% of that, or $17.80. The remaining $6.26 of cost-basis was applied to WBD and scaled up for the share count difference.)

I learned today, after all of the dust settled and WBD shares are trading "regular way", that the cost basis of WBD is $0.00 - and my cost basis of T is unchanged.

This has pretty important implications for my decision making on what to do with WBD shares. Long story short, I'm not selling in taxable accounts but plan to sell in non-taxable accounts and roll the proceeds back into AT&T.

My debate on this platform is:

1) Do I treat the account as taxable?

2) Do I treat the account as non-taxable?

3) Do I continue with my adjusted cost-basis approach?

I'm leaning towards #3 since it most matches the ECONOMIC REALITY of the shares and decisions leading up to this AND from here. But because the tax implications are so much different in reality, perhaps I choose #1...