The second year of the deal is a team option that needs to be guaranteed by Orlando before July 1, 2015, a source told Yahoo Sports.
The Magic are working to improve their perimeter shooting and expect Gordon to be a value signing to complement the young backcourt of Elfrid Payton Jr. and Victor Oladipo.
Gordon, 31, played part of the past season with Charlotte before being waived. In 10 NBA seasons with Chicago, Detroit and Charlotte, Gordon has averaged 15.6 points per game.
He was the NBA's Sixth Man of the Year in 2005 with the Bulls.
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