Unknown Padding on Containing Element

Question

There is what appears to be a 2px bottom padding on the image to the containing element. I am able to resolve this by removing the z-index. I need the z-index arrangement however to provide an inset box shadow on the image.

It can be seen here: http://jsfiddle.net/JkLAP/

Answer 1

just add .photo{display:block}

demo: http://jsfiddle.net/JkLAP/2/