From cooking a meal to finding a route to a destination, many real life decisions can be decomposed into a hierarchy of sub-decisions. In a hierarchy, choosing which decision to think about requires planning over a potentially vast space of possible decision sequences. To gain insight into how people decide what to decide on, we studied a novel task that combines perceptual decision making, active sensing and hierarchical and counterfactual reasoning. Human participants had to find a target hidden at the lowest level of a decision tree. They could solicit information from the different nodes of the decision tree to gather noisy evidence about the target’s location. Feedback was given only after errors at the leaf nodes and provided ambiguous evidence about the cause of the error. Despite the complexity of task (with 107 latent states) participants were able to plan efficiently in the task. A computational model of this process identified a small number of heuristics of low computational complexity that accounted for human behavior. These heuristics include making categorical decisions at the branching points of the decision tree rather than carrying forward entire probability distributions, discarding sensory evidence deemed unreliable to make a choice, and using choice confidence to infer the cause of the error after an initial plan failed. Plans based on probabilistic inference or myopic sampling norms could not capture participants’ behavior. Our results show that it is possible to identify hallmarks of heuristic planning with sensing in human behavior and that the use of tasks of intermediate complexity helps identify the rules underlying human ability to reason over decision hierarchies.