Simply put, the inciting incident is the moment everything changes. Often this is passive: your character might not have the goal to end up where he/she does when they embark on this journey, but his/her actions took them that way regardless.
What a character must do, is react to the inciting incident. If there’s no reaction, there’s no story.
As for my initial comment that a story often has two inciting incidents: the first one is the one that changes everything, which is usually found in the first 10% of the book, and the second one is where things change again. What is it that makes everything go to hell? The moment that raises the stakes? Again, this will spark a (strong) reaction from your character(s). You can refer to that as your second inciting incident. Both are ‘plot points’ in your story.
Let’s look at a few stories and their inciting incidents.
In The Hunger Games (Suzanne Collins) everything changes when Prim’s name gets called, and Katniss volunteers to take her place. This, as we know, leads to her surviving the games, but she didn’t set out to be a winner. She was simply protecting her sister.
In Something Strange and Deadly by Susan Dennard, it’s when Eleanor is at the train station to wait for her brother—except he never arrives, and she encounters The Dead, which then changes everything for her, too. In Truthwitch, also by Susan Dennard (read it, people!), Safi and Iseult’s heist goes all wrong, causing the girls to flee. Had this heist gone right, they would’ve continued to live in Veñaza City, and the story would’ve been very different (and potentially boring, although I doubt that’s possible with these girls!)
In Throne of Glass (Sarah J. Maas) Celaena Sardothien’s life changes from the mines of Endovier to the King’s Champion because she accepts his offer. She wants her freedom, and competing is the only way to get there.
In my own stories:
Megan dreams of Keith in Starstruck. While she struggles with her empathic ability in daily life, her dream with Keith is silent. This sparks her curiosity, and she sets out to meet him. She fails, but her life has changed regardless.
In Under The Dark Clouds, April is a storm chaser. A tornado has just touched down when she sees a drunk girl on the side of the road—Flower, my other main character—and April saves her from the approaching tornado. If Flower had not been there, April would’ve continued chasing as she always does. The girls would never have met, and I wouldn’t have had a story (or an agent).
So when you start your story, make sure you have your inciting incident clear. It will help you find the right beginning, because it will show you where to start.