Im making a banner/logo, could legal issues arise from using a picture I found on google in my website as a banner? Thank you
Yes, you could be sued for thousands of dollars. Taking pictures off google is copyright infringement. It's stealing someone else's work. Buy a photo from a place like iStockphoto.com.
am I able to include pictures in my articles hosted on my server or do i have to link it from their site.
You need to have permission from the copyright holder to use any image. Adding a link does not give you permission unless they have told you so. If you use a picture without permission, the photographer can demand a usage fee for using their photo (can easily be thousands of dollars per image) and also force you to take down the image. Even after taking the photo down, you still need to pay. They can also report you to google, which will remove your site from their index and can also get your adsense account banned. Always make sure you have permission to use a photo. All photos and artwork have an automatic copyright - it doesn't matter if it doesn't say copyright.
Don't freak over being sued. If you get an letter saying pull it, them pull it. They have to send you a letter first. People all the time take one image change it to what they want and use it for them self and it's legal. If your that worried go to any office supply store and buy a disc full of art work for $10 dollars. Now don't be stupid and use a company logo like Disney or a movie studio art work. They will be all over you for that. As far as taking a pic off of google and using it. Just be smart about it. Ms. jones is not going to take you to court for using her family picture, but Tom Cruise will. The one thing everybody forgets about the web. if you don't want it stolen don't put it on the net.
That's really stupid advice. They do not have to send you any letter. Once they find the image or artwork, you owe them a usage fee. You are also again wrong. Most celebrities do not own the copyright, the photographer does. Yeah, Tom Cruise won't sue you, the photographer will. And once more you are wrong, using just one photo is NOT legal. Copyright infringement can actually be a criminal offense, and there have people who have gone to jail for several years in extreme cases. In most cases, they are just going to demand you pay them a usage fee. Of course there are companies like Mattel that will sue you no matter what.