Since you sold the property at a gain, and the Fair Market Value is higher than the donor's adjusted basis, you need to use the donor's adjusted basis, which would be 12,000, as your basis .
You will need to claim 12,000 as your basis for the sale, unless you made improvements and/or unless your in-laws paid gift tax when they gifted it to you, which is possible but unlikely. The gain on the sale will be reported as long term capital gains.
IRS Pub 551
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