not sure by what you mean creates an inherited IRA - but in NY after 59 1/2 (on the first day of the year)

NY has a pension/IRA exclusion of $20,000 per taxpayer. It can come from a regular or inherited IRA, 401K or pension. It all goes to one line on the tax return. 

This exclusion is per year. Any amount over the $20K in the same year is taxable.