Does severing joint ownership of a rental property count as a taxable disposition for each owner?

It can, depending on the specific transaction. Severing joint ownership of a rental property, for example converting a joint tenancy into a tenancy in common, or carrying out a formal partition between owners, can trigger a taxable disposition for each owner if the change is considered to alter their ownership interest in a way that constitutes a disposition for tax purposes, potentially triggering a capital gain or loss, or affecting CCA and UCC calculations, at that point.

This isn't a simple yes-or-no question, because whether a particular severing transaction actually counts as a disposition depends heavily on exactly what changes and how. Some ways of severing joint ownership may not meaningfully alter each person's underlying proportionate economic interest, while others can effectively involve owners exchanging or reallocating interests in a way that does trigger disposition treatment. Because the tax consequences can be significant if a disposition is triggered unexpectedly, and because the answer genuinely turns on the specific mechanics of how the severance is carried out, this is an area where the particular transaction needs a careful, individualized look before assuming either that nothing changes for tax purposes or that a full disposition automatically results.