The contract will also include up to $2.5 million in active and roster bonuses, according to Nightengale.
Hanrahan, 33, has not pitched in the majors since May 2013 because of an elbow injury. The Tigers signed him to a one-year deal last offseason and he earned $1 million despite not pitching in 2014.
Prior to his injury, Hanrahan had a 9.82 ERA over nine appearances with the Boston Red Sox in 2013. In his last full season, he had a 2.72 ERA with 36 saves and 67 strikeouts in 59.2 innings with the Pittsburgh Pirates in 2012.
Hanrahan has a 3.85 career ERA in seven Major League seasons.
- Brad Rowland