I am building one kind of system, which simply creates dynamic image from other image. I use:
$im = imagecreatefromstring(file_get_contents("clown_avatar.png"));
//$bg = imagecolorallocate($im,0,0,0); doesn't effect
The reason for this is that you are discarding the alpha layer. By doing so, the otherwise invisible parts of the image now become visible.
What you instead want to do, is load the original PNG image with alpha, and copy it onto a desired image (that is solely the background color) using