The Brazilian is due to undergo a medical on Monday after leaving Real Madrid and returning to the Serie A side he left four years ago on a free transfer until 2015
Following long negotiations into the early hours of Monday morning in the Spanish capital between Adriano Galliani and Kaka’s representatives, a deal was struck that sees the Brazilian arrive in Italy on a free transfer.
According to the club's official website, the Brazilian has signed a contract until 2015, with only performance-related incentives due to Madrid.
The 31-year-old will earn €4 million (£3.3m) net per season at Milan and is set to fly to Linate Airport on Monday morning to undergo a medical.
Kaka previously wore the Milan jersey from 2003 until 2009, winning one Serie A title as well as the Champions League during his first spell at the club.
The former Sao Paulo youngster then left the club for Real Madrid but never managed to live up to the high expectations at the Liga giants as he mainly warmed the bench at the Santiago Bernabeu.
He announced last week that he wanted to leave Madrid this summer and has now gotten his desired transfer back to Milan.