The search for a short-term investment after a home sale

Q: I am selling my home but have not decided where I want to settle next, so this requires me to rent for a while. I'm now considering my options on where to place several hundred thousand dollars of proceeds from the sale. I would like an investment that is secure, gets some consistent return, yet could be accessible in nine months to two years when I'm ready to purchase another home. I don't need to put it all in the same place. So far I've considered putting part of it into laddered bond funds or alternatively into laddered CDs.
G.B., via e-mail

A: For a short-term investment such as you're describing, certificates of deposit make more sense than bond funds, says Joan Most, a certified financial planner in Paramus, N.J. You need an investment with a definite ending date, or one that is without fluctuation of its principal, and those features aren't present with bond funds.

Ms. Most says you also might consider Auction Market Preferred Securities (AMPS). These money- market instruments are generally AAA rated. (But not always, so ask first!) They're available in $25,000 increments, and roll over automatically once a week. There are also tax-exempt versions, which might be suitable if your tax bracket is higher.

The benefit of AMPS, says Most, is that they can be stopped on a weekly basis, without risk to the principal. Speak with an investment adviser to find out whether CDs or AMPS would be best for your situation.

Q: Could you recommend some useful websites or books for basic tax education? I'm looking for sources of information for those of us who aren't CPAs, but would like to have some basic tools at our disposal to make better tax-planning decisions and enrich the communication of our goals to the hired professionals.
J.S., Los Angeles

A: If you want it straight from the horse's mouth, the best source for tax information is www.irs.gov, says W. Thomas Curtis, a certified financial planner in Gaithersburg, Md.

Mr. Curtis also recommends these websites for tax information:

www.taxtopics.net

www.taxsites.com/index.htm

www.funwithtaxes.com

www.newkirk.com/wm_tax.htm

www.cch.com

The problem with some websites that offer tax advice or tax information is that they often charge a "membership" fee or a per-use fee. Consequently, you might have to pay nearly the cost of an hour with a CPA (currently $125 in the Washington, D.C. metro area) to do the research you want, Curtis says.

If you're interested in a book, several professional tax preparation firms publish annual guides that should contain all the latest updates. One good print source Curtis suggests is "J.K. Lasser's Your Income Tax 2006," published by John Wiley & Sons Inc.

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