Some older fax machines won't work on a VoIP line, although many modern machines will. However, whether or not you have VoIP, you may be able to save money by doing away with the fax machine altogether. Sending a fax over a landline often incurs long distance charges, and receiving faxes uses paper and printer ink.
Most documents that are faxed can be sent more cost effectively and just as easily as e-mail attachments. If the original document was created electronically, attaching it to an e-mail message is a simple click-click operation. If not, you can scan it and send it.
Some people with whom you do business may insist on a fax instead of e-mail. Recently, a Merrill Lynch advisor refused to accept a form via e-mail because it contained personal information, even though I offered to encrypt it. However, I was able to send it using a free Web faxing service called FaxZero. The catch? They put an ad on the cover sheet. If you prefer not to have the ad, you can pay $1.99 to send the fax. If you send only a few faxes a year, this makes more since than maintaining a fax machine.
If you have people who insist on sending you faxes rather than e-mail attachments, you still don't have to deal with the expense of a landline, fax machine, paper, and ink. There are low-cost Web-based services for incoming faxes, such as Packetel that allow you to get a fax number and receive incoming faxes for $3.95 per month.