Photoshop Elements :: How To Copy Rectangle Photo Into Square Picture Frame

On my website, especially when pictures are side by side, I try to make all the same, i.e. square. To me it looks better. I have a picture that is rectangle and obviously cannot resize to a square - distorts the picture. I know there is a way to copy the rectangle picture into a square picture frame which allows the picture to be square while not distorting the rectangle size.
 
But I don't know how to do this. I have watched a video on this but still not clear how to do it.