The 19-year-old spent time on loan at Bloomfield Road last season, which culminated in a first-team appearance against Watford in May.
Martin will now travel to Blackpool to discuss personal terms.
Blackpool manager Simon Grayson said: "The lad did ever so well for us last year, even in the one game he played. We saw a lot in the training sessions to realise he would be an excellent addition to the squad.
"He played left-side midfield against Watford and we know he can play at left-back and in the centre of midfield. We want a hungry young player who wants to make a name in the game.
"He has a great attitude and wants to play and learn and hopefully it will be concluded and he will become a Blackpool player."