If you have Windows XP or Vista, and if your computer is equipped with a fax-modem as many are, and if you can plug your computer into a phone line, you can send and receive faxes at no cost. (You'll pay only for for the phone call.)
Here's how:
Windows XP -
Install the built in Windows XP fax software component. Use the "Start" menu, then select "Control Panel", then "Add or Remove Programs", then "Add/Remove Windows Components". You should then get a screen similar to this screen shot:


Check the "Fax Services" box and then click "Next" to run the Wizard. You should then see the screen above. Select "Printers and Faxes" under the "Start" menu.
Click Start, point to All Programs, point to Accessories, point to
Communications, point to Fax, and then click Fax Console.
In the Fax console, click New Fax or click Send a Fax on the File menu.
Alternately, you can simply select "Fax" as your printer when you print using the print menu. The Microsoft help files at the links listed below offer more help.
Enable and configure the Fax service: support.microsoft.com/kb/306550/
Send a fax in Windows XP: support.microsoft.com/kb/306657/
Fax a document from a Windows program: support.microsoft.com/kb/306661/
Receive a fax in Windows XP: support.microsoft.com/kb/306662/
Fax a scanned document in Windows XP: support.microsoft.com/kb/306663/
Fax With Vista - (Similar To XP Instructions Above)
You can't beat the price! But this solution requires you to tie up your phone line to send or receive faxes.
Take a look at our reviews of Fax Services if you want the convenience of a dedicated fax line without the need to add a second phone line.