Whatever format you capture your original image in (jpeg, raw, tiff) you should keep that image as your digital negative. To edit your image you should only work on a copy.
The best format in which to store your working copy is the format of your image-editing program (PS, PSP, etc.). That format will store all the extra info (layers, undo steps) associated with editing.
When you've got your final image you can save in whichever format will be best for the final purpose - normally jpeg - with the quality depending on the final display medium.
With the low price of storage nowadays it makes sense to keep all three images (digital negative, editing file, final output).
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Frank Hollis
Canon 2oD owner
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