The Portuguese boss is enjoying one of the best spells on his career, as United continue to fire on all fronts this season.
The Red Devils are unbeaten in all competitions this term and sit joint-top of the Premier League with neighbours Man City.
And according to The Sun, Mourinho is ready to put pen to paper on the five-year deal, worth £65m.
The United chief and his City counter-part Pep Guardiola are the joint-highest paid managers in world football, earning £250,000-a-week.
Mourinho will still earn the same amount on his new deal but his incentive package for trophies and league positions will be heavily increased.
The final details are still to be agreed.
Mourinho initially signed a three-year deal in the summer of 2016 and the former Chelsea boss wants to make his tenure at Old Trafford the longest of his career.
He has never lasted longer than three seasons at a club but has struck up a strong relationship with the United faithful.
The two-time Champions League winner claimed two major honours in his first season, lifting the EFL Cup and Europa League.
The 54-year-old takes his side to Anfield this weekend, as United look to continue their strong form against arch-rivals Liverpool.
