How do you make object backgrounds transparent in Illustrator?

[xarzu]

Hello Forum.
How do you make the background of an object transparent in Adobe Illustrator?
I have been having issues with using the Magic Wand tool in Adobe Illustrator as well as the lasso tool.
Basically, I am trying to put a small graphic into a new Illustrator file.
The first thing I tried to do is to use the magic wand tool. But I found out that this did not work on a jpeg image since it did not have any individual objects to select.
So I tried something new. I opened the file in Adobe Photoshop and used the lasso tool to select an area. Then I coped this area. Then I tried to paste it into Adobe Illustrator. But the background was not transparent for the pasted image.
How do I make the background transparent.
I made this small video to show what I am talking about:

I noticed that the background is a layer in the image I made in photoshop. I tried turning it off or making it invisible, but that did not help.
http://i67.photobucket.com/albums/h292/Athono/hidebackground_zps0338ed4b.png
http://i67.photobucket.com/albums/h292/Athono/backgroundinphotoshop_zps04ea33fd.png

 

[1nstan7]

just use the magic want tool on the white and hit delete. Or make it easy and just send the file