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I use PS7, but I would imagine it's the same process. Type out your text in black, then choose Select, then Color Range and click on your letter (or just use the Magic Wand). This will select your text, then choose Inverse Selection, switch to your layer that you want to cut your letter out of, then hit the delete key. This should leave a cutout of your text.
I also just read about the Control + g method, but I haven't tried that out yet, so I'm not entirely sure how that one works.
HTH!!
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