Ince, 22, joined the Tigers during the summer after his deal with the Seasiders expired but, due to his age, Blackpool were entitled to recoup a fee for the England Under-21 international.
The two clubs were understood to be attending a tribunal last week in order to determine how much Ince would cost Hull and Blackpool confirmed on their official Twitter feed that a subsequent package had been agreed.
They said: "The club can confirm that a compensation package has been agreed with @HullCity for Tom Ince, without the need of a tribunal.
"The Tigers will pay up to Â£2.3m for the 22-year-old, who moved to the KC Stadium on a two-year deal in the summer."
Ince, who is the son of ex-England captain Paul Ince, began his career at Liverpool but moved to Blackpool in the summer of 2011
The winger started Hull's first three league games of the season this year but was loaned out to Nottingham Forest in November and has struggled to make an impact since returning to East Yorkshire.
Source : PA