Inherited IRA and NJ Transfer Inheritance tax

[fanfare]

Here's the situation:
A niece inherited an IRA from her uncle living in NJ.
She paid NJ Transfer Inheritance Tax.

She takes an RMD yearly.

However, NJ has this little known rule which states as follows.

"The [niece] can exclude from Income Tax the amount
which is the value determined for Transfer Inheritance Tax purposes."

Therefor, until the RMDs add up to the inherited amount,
the RMD is not NJ taxable.

Unlike previous years, in 2019 her income including the RMD is below $10,000.
Therefor she does not have to file an NJ return and the NJ tax is zero.

The question is:
Does the RMD for 2019 get subtracted from the value determined for Transfer Inheritance tax purposes, or not?
I don't think it should be, since there is already no tax on that RMD.

[Critter]

Call a local tax pro in NJ to confirm but I think the transfer tax is only paid once when the account is transferred so all the RMD would be tax free in NJ. 

[fanfare]

I expect that the "amount which is the value determined for Transfer Inheritance Tax purposes"

will be less than the RMDs as the IRA is anticipated to grow significantly.

The earnings on the IRA have already made back the 15% Transfer Inheritance Tax.