Hello, My Name is Chad.
The property is currently titled in your name.
Your daughter and her husband plan on obtaining a mortgage with a bank and use the proceeds from the mortgage to pay you back.
Once you are paid back, you will then transfer the title to your daughter or your daughter and her husband.
The excise tax is a tax on the transfer of the title. I'm in New York where the tax is two dollars for each $500.
For example: on a property with a sale price of $200,000 the excise tax would be $800.
If I understand you correctly the title transfer/sale price will be:
1) what you paid for the land Plus, your cost. Labor, materials, etc.
The transfer price should be far less then the fair market value since your daughter and husband have put their own money and labor into the project. You can't avoid the excise tax, unless your state doesn't have it, but you can minimize the tax.
This applies if you are receiving your return of capital only. If the bank is paying you the full loan to value amount directly then keep good records for your taxes.
With the information given, I think you did a good job of limiting the excise tax while also limiting your liability, but make sure you document everything.
Before your daughter and son in law finalize the mortgage agreement with the bank, I would make sure I understood the how the settlement check will be written and processed.
If you have any follow up questions please let me know.