Gareth Southgate will be offered a new contract with a significant pay rise to remain England manager beyond 2020.
Southgate has two years remaining on his current deal but the FA want to reward his success in leading England to the semi-finals of the 2018 World Cup.
The performance in Russia is likely to see Southgate attracting interest for club jobs when they become available next season, and the FA believes it makes sense to offer him a new contract now.
Talks will begin next week when Southgate returns from his holiday.
Any new deal is likely to take him through to the 2022 World Cup in Qatar.
0:53 Southgate said England's performance at the World Cup made millions of people happy
FA chief executive Martin Glenn says England have unfinished business under Southgate and they want to become one of the top four countries in the world.
England’s semi-final appearance in Russia was their best performance in a major tournament for 28 years, but Southgate said his side were “not a top-four team yet”.
He has been shortlisted for The Best FIFA Men’s Coach of 2018 alongside the likes of Manchester City’s Pep Guardiola and Liverpool ‘s Jurgen Klopp.
Southgate was initially appointed interim manager when Sam Allardyce’s 67-day reign as England boss came to an end, but was given the job on a four-year deal in November 2016 after two wins and two draws in temporary charge.
He signed a contract reportedly worth up to £2m a year.
The FA has also confirmed it is preparing a bid for England to host the 2030 World Cup.
FA chairman Greg Clarke said “feasibility work” will now be carried out but no final decision will be made until 2019.
One option is for a joint bid with the other home nations, while the UK government has said it will support a joint bid led by England.