Joint tenants enjoy right of survivorship. There would not be an inheritance tax on the portion of the house that belonged to you, and will now belong to your grandchild. However, if you have not already entered into this arrangement there are things to consider. If you add your grandchild to your home as a joint tenant, that constitutes making a gift to them of their portion of the value of the home. For 2022 the annual gift exclusion is $16000. As it is likely that your home is worth more than $32000, you would be required to file a gift tax return, and use part of your lifetime estate and gift tax exemption to eliminate any tax on the gift.
There would be a step up in basis on the portion of the asset that was inherited from you, but not on your grandchild's original portion. This new basis would be used to calculate capital gains tax if your grandchild sold the home.
