Reports out of the US suggest the 35-year-old will be announced as early as tomorrow as coach of Toronto after former Ipswich town and England striker Paul Mariner was fired.
Nelsen is contracted to English Premier League side Queens Park Rangers until the end of the season but reports suggest he will ask for a release and retire from playing.
It is conceivable he could be a player-manager but this has rarely been a success and Nelsen might feel that with no previous coaching experience he needs to devote all of his energies to managing.
Toronto are going through considerable change under new president Kevin Payne, who was in charge at DC United during Nelsen's spell there which included an MLS title in 2004 and is an unabashed Nelsen fan.
Nelsen will reportedly take over from Mariner, who has been under pressure at the club after they finished with the worst record in the league last season - they went winless in their last 14 games - and have yet to make the playoffs in their six-year history.
Nelsen has tried to water down speculation but QPR manager Harry Redknapp doesn't expect his skipper to stay. "He has been offered a job in America and I think there is every chance he might want to go," Redknapp told reporters after QPR's 1-1 FA Cup draw with West Brom.
Redknapp said it would be a blow to QPR but it would be an even bigger one to New Zealand's chances of qualifying for consecutive World Cups. He was a large factor in the All Whites going unbeaten in South Africa in 2010 and, even at his age, is still the best player in the squad.
His influence extends beyond what happens on the pitch and teammates gain confidence by just having him around. The All Whites are in the box seat to qualify for November's intercontinental playoff with the fourth-best team from North and Central America.
