I'm having a small problem with the way that IE displays my favicon.ico. I used photoshop CS5 to create an image with transparency then used the photoshop plugin to export the file as an ico file.
Below is an image of what the icon looks like in IE. As you can see there is a white background or piece of paper with a folded corner.
I've provided a link to the image below. When you follow the link the image will be in the upper left hand corner.
[edited by: bill at 4:29 am (utc) on Jun 7, 2012]
[edit reason] removed example link [/edit]