VW executives will meet to approve the deal which adds to a $15bn payment already agreed with US environmental bodies and drivers.
Volkswagen said it has agreed a draft $4.3bn (£3.5bn) settlement with US regulators over the diesel emissions scandal which will also see it plead guilty to criminal misconduct.
The agreement, which needs to be approved by VW boards and US courts, would also see an independent monitor appointed to oversee compliance and control at the company for three years.
It adds to a $15bn (£12.3bn) civil settlement with environmental authorities and car owners in America under which it agreed to buy back up to 500,000 vehicles.
The company has now exceeded the €18.2bn (£15.8bn) set aside so far to handle the scandal after it admitted using "defeat devices" to cheat on emissions tests.
Volkswagen reached the latest deal, covering civil and criminal fines, with the US Department of Justice and US Customs and Border Protection.
Top executives at the German carmaker are expected to meet shortly to approve it.
Volkswagen's admission in September 2015 that it had used defeat devices in the US became a worldwide scandal with 11 million vehicles affected globally.
The carmaker is involved in lawsuits in several countries.
This week a UK law firm said 10,000 motorists had signed up to legal action against VW seeking £3-4,000 per car for loss of "inherent value".
The company said it would "robustly" defend the case and that it did not believe customers would lose out as a result of the scandal.