How do I Send/Receive Faxes in Windows XP?
There are a number of advantages to moving to a Windows XP-based fax system, the main one being no wasted paper. No need to print documents before faxing them. You can read, save, delete, or attach incoming faxes to e-mail—all without using a single piece of paper. Of course, you can print them too.
Microsoft has provided a nice article describing what is need to FAX in Windows XP.
As well as in Vista (Business, Enterprise, and Ultimate only).