How do I Remove the Background Layer or bounding box??
Lyn,
How are you getting your image into Illustrator?
If you use the Place command in Illustrator and directly place the Photoshop file, linked, it will preserve the Photoshop transparency. You can also export a file from Photoshop in any format that preserves transparency, just as PNG. If you Copy-Paste or drag-and-drop, it will not preserve transparency. Most applications don't handle transparency data, so the clipboard format doesn't contain it. JPEG format also doesn't support transparency, and TIFF only supports it by way of clipping paths.
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