Yes. It may be preferable and less open to loss or degradation. Important paper documents may be scanned as digital PDF files and stored on a computer. Those files may be tagged or otherwise marked up with notes without compromising the actual document.

While the IRS is OK with digital records, it reminds taxpayers that they must able to be reproduced “in a legible, readable format” and that retention requirements for paper records also be applied to digital records.

Please feel free to post any additional details or questions in the comment section.