"He's talked about it. Whether or not it comes to that, I'm not sure. He would do whatever it takes for the kids to stay (with Katherine)," the source said Monday. His supposed willingness to step aside was first reported on People.com.
Joe Jackson, now 80, recently told ABC he wants to help raise the kids so they can "grow up to be strong Jacksons."
A custody hearing scheduled for this week was postponed to Aug. 3 amid reports that lawyers for Katherine Jackson and Debbie Rowe were close to a deal.
Katherine, 79, was named temporary guardian to Prince Michael, 12, Paris, 11, and Blanket, 7, pending the postponed hearing. Michael also named Katherine his first choice in his will.
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