There were reports earlier in the day which claimed that the Italian was Farhad Moshiri's first choice for the managers job, and this recent development has confirmed that news.
Ancelotti prime target for Everton
Things went downhill for Ancelotti in his previous job at Napoli, where he was sacked by the club despite guiding the Naples outfit to the knockout stages of the Champions League.
As such, the 60-year-old veterans name has been in the news at a time when Arsenal too are looking out for a man to replace the axed Unai Emery.
Although, it looks as if the Gunners have zeroed in on former Everton player Mikel Arteta as their prime candidate for the managerial hot-seat, which has given the Toffees a clear run at securing Ancelotti's services.
Marco Silva was relieved of his duties as he failed to stop the rut that Everton found themselves in; the Goodison Park outfit were languishing in the relegation spots after a humiliating defeat at the hands of bitter rivals Liverpool.
Since the Portuguese's departure, club legend Duncan Ferguson has taken over as interim coach and has guided Everton to a win and a draw against Chelsea and Manchester United respectively in the past couple of weeks.
Ferguson's appointment has helped reestablish a link between the players and the Goodison Park faithful, whilst the positive results have given the top brass some breathing space and time to get the next appointment right.
It is believed that if Ancelotti is appointed as Everton manager, Ferguson will remain a part of the Italians first-team coaching staff.