Reed suffered the latest in a long line of concussions last year and failed to appear in a game for the Washington Football Team. After the veteran was released this offseason, there was speculation he could retire.
The 30-year-old's extensive concussion history includes seven documented head injuries in the NFL and two more in college.
He'll reunite with 49ers head coach Kyle Shanahan, who was Washington's offensive coordinator from 2010 to 2013.
Star George Kittle is atop the 49ers' tight end depth chart, but the team needs more experience behind the Pro Bowler.
In seven seasons in Washington, Reed racked up 329 catches for 3,371 yards and 24 touchdowns.