Authorities in Santa Barbara County had been preparing for tens of thousands of fans to descend on the 2,500-acre ranch after media reports that a public viewing would take place later this week.
But the person, who is not authorised to speak for the family and requested anonymity, said nothing is planned for Neverland at least through to Friday.
The person said it appears more likely a funeral and burial will take place in Los Angeles. The family has the final say.
A private memorial service for family and friends could take place at the ranch, most likely after the funeral.
The person said billionaire Thomas Barrack, who owns Neverland in a joint venture with Jackson, sought an exemption to bury the singer at the ranch. But the person says it's a complicated process and it couldn't be done for a burial this week.
"The family is aware a Neverland burial is not possible. They are expected to make decisions about whatever funeral and memorial service" will take place, the source said.
It was not possible to rule out that Jackson's body might return to the ranch, either for the private service or a burial sometime in the future, if the family can get the go-ahead from state and local officials.
Asked about the possibility that Jackson could be cremated and the remains brought to the ranch, the person said, "That's not the plan."
The family would need to get permission from local land-use officials to bury Jackson on private property, then submit an application and paperwork with the state Cemetery and Funeral Bureau.
The state application would then need to be approved by the funeral board, a process that could take anywhere from seven to 30 days.
Kim Brown, a spokeswoman for the Department of Consumer Affairs, could not confirm any application had been filed by Jackson family representatives unless the certificate had been approved.
Heavy construction equipment and workers were seen passing through the wrought-iron gates of Neverland on Tuesday. The property is about 120 miles northwest of Los Angeles.
At once a symbol of Jackson's success and excesses, Neverland - nestled in the hills of Santa Barbara County's wine country - became the site of a makeshift memorial after his death.
