How do I make jpeg image background transparent?

[steve.ledger]

The point is, you can knock out the background from this JPEG in several ways as mentioned earlier before bringing it into Illy or simply do it all in Illy.
As the OP asked "Anyone know how I could do that either with Photoshop or Illustrator?" then either method is a valid answer for him/her.

You can try to tell us all that we're all doing it wrong, working back-to-front, inside out or upside down (in my case as I'm in Australia) and that there's just "one correct answer" by which time we've all finished the task while you're still talking