The Welsh international departed the Hammers in the summer, writing an extended letter to supporters to express his thanks for sticking by him during his time at the club.
Collison fell out of favour last season, spending time on loan at Bournemouth and FA Cup semi-finalists Wigan Athletic.
The midfielder spent time training with QPR in July but now appears poised to sign for Mick McCarthy's Ipswich Town.
Collison featured for the Tractor Boys' under-21 side against Sheffield Wednesday earlier this week, playing 90 minutes in the match.
The Ipswich Star report: "A deal for free agent Jack Collison could be completed next week."
Collison is one of the more intriguing free agents left on the market, with 17 international caps to his name and Premier League experience with the Hammers.
Just a fortnight ago McCarthy told BBC Radio Suffolk: "He's certainly got real quality. He wanted to get himself fit."
"He lives half an hour away, I told him to come and train with us. Who knows? Something might come of it, or something might not."