Basics for connecting PC to stereo

I am only using CDs to listen to music on my stereo. I would like to start to use my computer to be the source of my music for both convenience and I have some music only in mp3 or wav due to the unavailability of the music in CD format (example dj spooky remixes).

I have yet to find a basics guide on how to do this but I am hoping I have been looking in the wrong places and some of you know where it is.

I have a low budget stereo for an audiogon user (which is high budget for the general public), no standalone DAC, and am hoping to make the transition for under $1000, but willing to go $1500.

Any information would be greatly appreciated.
As a follow up I did find this:

I like to do a lot of research so I am looking for more.
Must be at least 10-20 threads already on this site alone.
One other favorite is:
I can't help you w/details about the best digital formats or software for storing music on your computer hard drive -if that is what you mean but listening from a computer is pretty easy. I'm just using an ASUS netbook. Kimber cable w/USB from netbook to Mobile Fidelity V-DAC. RCAs from V-DAC to pre-amp inputs. Warm up the amp, pull up Pandora on the netbook and listen. Can also listen to downloaded music files. Got the V-DAC & Kimber cable from Audio Advisor. Got the Asus from Amazon. Everything for around $700, if I recall. (Other computer/DAC combinations might give you better interconnect options; some folks don't like USB.)
Before you get started, you should understand that following the right advice here is critical. You can avoid a lot of work re-ripping your CD's later. The ripper and the playback software is critical to getting good sound quality. Depending on whether you are using PC or Mac, here are some tips:

The other important aspect of digital audio is that the MASTER CLOCK is the most important part. This is buried inside your CD player and also inside any computer audio interface that you use, including USB to S/PDIF converters, AppleTV, Airport Express, Sonos, Squeezebox Touch, Roku and others. The quality of this clock or clocks makes or breaks the audio quality. If you want it to match or beat the quality of your CD player, then dont spare the expense on the computer interface with the master clock in it.

If you just want a taste of what computer audio can do, and dont want to spend much, then get the Logitech Touch. This has a half-way decent clock.

Steve N.
Empirical Audio
Depends on your OS and mobo audio outs. I'll use (Arch) Linux + OSS4 as as example. Because OSS4 does not provide support for onboard S/PDIF out and because USB support is still experimental, you will need a soundcard (e.g. Xonar ST) with S/PDIF (coax/TOSLINK) out. Using S/PDIF coax as part of the example, connect a digital coax cable from soundcard coax output to the coax input of your chosen standalone DAC. If you have active speakers, simply connect your speakers to the DAC via available output methods (typically RCA, or XLR). If you have powered speakers, connect the DAC to your amp. Done. Linux + ALSA/PulseAudio? You can go straight USB out from your mobo.