Note that whatever amount you gave to your sister-in-law is a gift from you to your sister-in-law. It is not anything that sister-in-law inherited. You were the one who inherited these funds to do with as you choose and you chose to gift a portion to your sister-in-law. If the amount that you gifted to your sister-in-law in 2025 is more than the 2025 gift exclusion of $19,000, you must file a 2025 Form 709 Gift Tax Return.
