There are many versions of Linux suitable for hard disk install (Knoppix is not really one of them for most users). If I were doing this I would install the current "testing" version of Debian.

If you are planning on reinstalling Windows and Linux, I would suggest that you not install Linux first. Windows does bad things to an existing Linux install during it's install, but Linux generally gets along just fine with Windows if space is left for it when Windows is installed and then Linux is installed later. It will even take care of the dual booting for you.

If your most pressing Windows need is tax software, then you might want to consider just installing Linux and then running Windows in a virtual machine under Linux. This isn't really a viable solution for some things like on-line gaming, but should work well for tax software and, in fact, would be a lot more secure than a Windows install.