How will returning to your PhD advisor as a post-doc affect future career options in academia? I am currently in a joint teaching/research post-doctoral position at a university that is different than where I obtained my PhD.  There may be an opportunity in the future for me to return to my old PhD advisor and be hired on as a post-doc once my tenure is up here.  I don't really NEED the job as I have decent job security teaching where I currently am.  It will, however, keep the door open for sustaining good research, publishing, and gaining grant-writing skills... the latter being something that my current post-doc advisor has never offered me...  And yes, personally I would like to go back and work for them again (for a variety of professional related reasons).

I understand this will be a lateral move at best but I am trying to gain sufficient understanding on how this will affect future career options in academia.  I've been told that this type of situation can cause people to simply overlook you when applying for faculty positions at higher-ranked schools.  I'm not really interested in joining some "Top 50" research university either but I'm not willing to join a pure undergraduate research program just yet either.

Please advise.
It really depends on what country you are working, and what are your final goals. Most European academic institutions do tend to hire for tenure people who got their PhD in the same institution. I personally believe it is indeed an insular, unwritten policy, that is detrimental for professional development, and impoverishes the institutions research. Contrarily, most USA institutions take for granted your willingness to explore beyond your comfort zone. 
As far as it concerns you personally, you see where I am heading by the language I am using :)