Departing Liverpool star Steven Gerrard will join the LA Galaxy on an 18-month contract, a source close to the deal told ESPN FC's Jeff Carlisle.
The defending Major League Soccer champions will add the midfielder after the Premier League season ends on a pro-rated deal worth $6 million (3.9 million pounds) a year. The Washington Post earlier reported details of the contract.
The MLS Board of Governors approved the deal because the league will pick up $750,000 of Gerrard's deal, the source said.
An MLS representative told ESPN FC the league is "not able to provide additional insight into a potential player agreement."
Gerrard will help fill the void in the Galaxy midfield left by longtime Galaxy star Landon Donovan, who retired last month after LA won the MLS Cup.
While MLS operates under a salary cap structure, each club has three Designated Player spots which they can use to sign high-priced stars. The Galaxy already have Republic of Ireland striker Robbie Keane and U.S. defender Omar Gonzalez as two of their DPs, but the third slot came available when Donovan retired.
MLS pays a portion of all clubs' Designated Player salaries. Last year, that charge was $387,500 per player.
Gerrard, 34, will remain with Liverpool until the end of the English football season in May. He would then be eligible to join the Galaxy once the MLS summer transfer window opens in July, according to FIFA regulations.
He confirmed in a video on Liverpool TV earlier Saturday that he will leave the Premier League to move to the United States, but said he had yet to complete a deal with a specific team.
"I'm not over the line with any team just yet," Gerrard said. "I'm close and as soon as I know, I'll make the announcement, I'll do the bits and bobs that I need to do."
Gerrard has spent his entire career with Liverpool, making his first-team debut in 1998, and has won trophies including the Champions League, UEFA Cup and two FA Cups.
He might only have six months left at the Merseyside club, but Gerrard still wants more success before he moves to Los Angeles: "I think, where I'm sitting at the moment, realistically, we've still got a chance of finishing in the top four and that's the most important thing for the club, for obvious reasons. That would be a great achievement after the start we've made in the league.
"But from a selfish point of view, it's always a trophy and it's always medals, for me. That's what people remember and that's what the club is all about. It's about success and history. The day you make your debut for this club, the pressure and the responsibility is on your shoulders to keep delivering trophies to add to that wonderful history.
"I've lived with that for so long and I'll live with it for another six months and try my best to add one or two more."
He underlined his desire to return to Liverpool in another capacity one day, if the opportunity arises.
"I think that's more in hope [coming back]," he explained. "I'll only come back and serve the club if I feel as if I can help. I'll always be a fan, of course, no matter what happens in the future. But I think that's something I'll have to consider.
"I think when you've been part of a club like this for so long and you've contributed in the way I've tried to, I'd always want that to stay the same in the future. I wouldn't like to come back just to be Steven Gerrard the player and just be around. I'd like to help in whatever capacity that may be.
"If I sit down with the people who are running the club at that time and they see a role for me where I can help the team or help young kids to become players, of course I will consider it because, as you say, it's been such a big part of my life."