The Heat will trade guard Josh Richardson to the Sixers as part of the agreement, according to ESPN. Butler will sign a four-year, $142 million maximum contract with the Heat.
The Chicago Bulls originally picked Butler in the first round (No. 30 overall) in the 2011 NBA Draft. He was a three-time All-Star selection with the Bulls before being traded to the Minnesota Timberwolves during the 2017 off-season.
After helping the T-Wolves reach the postseason during the 2017-18 campaign, Butler demanded a trade last fall. Minnesota eventually dealt the 30-year-old guard to the 76ers in exchange for forwards Robert Covington and Dario Saric in November.
In 65 combined contests with the Timberwolves and 76ers this season, Butler averaged 18.7 points, 5.3 rebounds, four assists and 1.9 steals per game. The 76ers reached the Eastern Conference semifinals but lost to the eventual NBA champion Toronto Raptors in seven games.
NBA free-agent contracts can't be officially signed until July 6.