Drag the green block straight down. Note that you must drag it past the 3rd blue block before the placeholder will appear. Return the green block back to the top.
Change to "Tab 2". Drag the green block straight down once again. Note that now you only need to drag the green block past the 1st blue block before the placeholder appears. The length of the hidden tab is *exactly* the length that you must drag the green block down before you can drop it.
You can also experiment by dragging the blue blocks onto or off of the tabs in order to lengthen/shorten the height on either tab. In all cases, the height of the hidden tab ALWAYS dictates how far down you must drag the green block before being allowed to drop. You could, alternatively, experiment by dragging the green block 2-3 inches to the right before dragging it down. This also avoids the phantom tabs overlay.