With today's cameras I would imagine you have plenty of resolution so as to avoid pixelization.
First, I would make sure the picture is 300dpi. It is done through a dialog box, Image->Image Size, I believe. When you change the dpi, the dimensions will change for the image, but you are not losing any pixels.
If the image is exactly what you want, then you can use the same dialog box to set the dimensions and you should be done.
If not, next I would turn on the rulers to use as a reference, since the passport photo needs to be a specific size. If you know how to drag down guidelines from the rulers do that (it's easy, just click in the ruler and drag into the document. A line should appear, but it will not be part of the true picture).
Then you should shrink the picture to fit into the correct dimensions. You can shrink it either by using the transform function (Ctrl-T) or using Image->Image Size. You can crop the picture if it makes it look better. The pixelization should not be a problem.
Easy... (assuming this is a High Res Photo)... with the crop tool selected, at the top (under your menu) there should be some areas where you can input numbers... Type in the width in inches (example: 3 in) and height (in inches) that your picture need to be. And in DPI (or resolution) type 300.
Then crop the image, making sure your head is where it is supposed to be and it will shrink it down.
You need to follow certain directions for passport photos, that you can get from the US government website. Just search "passport photo instructions"