The Inc checkbox is to mark a Student as Incomplete. This will display the Student as an I on their report card. If you have students that were marked as incomplete until they completed the Assignments, when you recalculate grades, upon save, the Inc checkbox is automatically deselected and the new calculated grade is displayed.

Additionally, if using a hybrid report card, please be sure that your associated grade category has a grade translation selected, as detailed here: Hybrid Report Card is not displaying 'I' for a standard grade that was marked 'incomplete'