Israel is set to get about $38 billion over 10 years, according to Congressional and administration sources, up from the approximately $30 billion decade-long deal that expires in 2018, CNN reported.
The Memorandum of Understanding sealing the arrangement will be signed on Wednesday at the State Department.
Talks to reach an agreement took months, unfolding behind closed doors at a time when US-Israel ties were strained by tensions between President Barack Obama and Prime Minister Benjamin Netanyahu and Israeli frustration over the nuclear pact with Iran.
"It's an important message to the region that nobody should misread the differences between the US and Israel when it comes to Iran or policy differences when it comes to the Palestinians," said David Makovsky, Director of the Project on the Middle East Peace Process at the Washington Institute for Near East Policy.
"At the core, the US remains very committed to Israel's long-term security."
Israeli perceptions that sanctions relief provided as part of the nuclear deal would allow Tehran to wreak greater havoc in the region drove Jersusalem's argument that the deal should be much larger than previous packages. Regional unrest in Syria and Iraq deepened Israeli concerns, CNN added.
New York Representative Nita Lowey, the highest-ranking Democrat on the House Appropriations Committee, said in a statement on Tuesday that the agreement would put Israel "in a better position to address turmoil and instability in the region and therefore be able to better protect its citizens and secure its borders".