PNG is best, because it's small, and other ones like JPG make you lose clarity.
Look at the attached picture.
The one on the left was saved as a JPG.
The one on the right was saved as a PNG.
Save it and zoom up on it and you'll see what I mean about the clarity.
pngjpg.png
- JPG on left, PNG on right.
- (2.7 KiB) Downloaded 85 times
SuyoEDIT:
Pretty long, but interesting post about image formats. agent's post was basically a tl;dr version of it.