Kenmore Water Heater Install

On my new kenmore power miser 12 there is a blue plastic tube all the way up into the cold water inlet, threaded portion. I'm assuming this is the dip tube. Is this suppose to be up that far? And, how do I thread my heat traps into the cold water inlet with that in the way?
Thanks

Is it a hollow plug put there to keep crud out until it was installed?

The dip tube should slide into the threads and still allow you enough room to install your "Heat trap" nipples.

Can someone recommend someone that can install a gas direct vent water heater on the Eastside, Seattle area? I'm sick of working on this