After stitching a panorama using Photomerge, how can I crop out all the empty space on the sides? Seems like there should be a tool for this, but I can't find one in Photoshop.
Pressing "R" (or "C" in older versions) should bring up the crop tool.
It is then self-explanatory. Just use the mouse to select the area you like to crop to. You can use the handles on the sides and corners for that, too.
As explained here, you can go to
File > Automate > Crop and Straighten Photo... and have it done for you.
I don't know what version of Photoshop you're using but in Elements 11, I get a popup after it's finished photomerging asking me if I want Photoshop to automatically fill in the empty space around the edges.
I've never managed it though. I have 8Gb RAM but that's not enough as it chugs away for a while before running out of memory!! :(