diff --git a/lib/ansible/plugins/strategies/free.py b/lib/ansible/plugins/strategies/free.py
index ea894c5bf6..43b6296473 100644
--- a/lib/ansible/plugins/strategies/free.py
+++ b/lib/ansible/plugins/strategies/free.py
@@ -21,6 +21,8 @@ __metaclass__ = type
 
 import time
 
+from ansible.errors import *
+from ansible.playbook.included_file import IncludedFile
 from ansible.plugins.strategies import StrategyBase
 
 try:
@@ -140,6 +142,31 @@ class StrategyModule(StrategyBase):
             results = self._process_pending_results(iterator)
             host_results.extend(results)
 
+            try:
+                included_files = IncludedFile.process_include_results(host_results, self._tqm, iterator=iterator, loader=self._loader, variable_manager=self._variable_manager)
+            except AnsibleError, e:
+                return False
+
+            if len(included_files) > 0:
+                for included_file in included_files:
+                    # included hosts get the task list while those excluded get an equal-length
+                    # list of noop tasks, to make sure that they continue running in lock-step
+                    try:
+                        new_blocks = self._load_included_file(included_file, iterator=iterator)
+                    except AnsibleError, e:
+                        for host in included_file._hosts:
+                            iterator.mark_host_failed(host)
+                        self._display.warning(str(e))
+                        continue
+
+                    for host in hosts_left:
+                        if host in included_file._hosts:
+                            task_vars = self._variable_manager.get_vars(loader=self._loader, play=iterator._play, host=host, task=included_file._task)
+                            final_blocks = []
+                            for new_block in new_blocks:
+                                final_blocks.append(new_block.filter_tagged_tasks(play_context, task_vars))
+                            iterator.add_tasks(host, final_blocks)
+
             # pause briefly so we don't spin lock
             time.sleep(0.05)
 
diff --git a/lib/ansible/plugins/strategies/linear.py b/lib/ansible/plugins/strategies/linear.py
index 6de217f3f1..feac091766 100644
--- a/lib/ansible/plugins/strategies/linear.py
+++ b/lib/ansible/plugins/strategies/linear.py
@@ -194,8 +194,8 @@ class StrategyModule(StrategyBase):
                             if self._take_step(task):
                                 choose_step = False
                             else:
-                                break
                                 skip_rest = True
+                                break
 
                         self._display.debug("getting variables")
                         task_vars = self._variable_manager.get_vars(loader=self._loader, play=iterator._play, host=host, task=task)