We are recently auditing the folder permissions and file permissions for our firm. We basically want to start from scratch. Is there a way that we can set all files and folders to inherit from the main site? So many of our sub document folders have been modified over the years. Thanks!

Select the library, go to settings, document library settings, permissions for this document library, actions, inherit permissions. I think that is what you are looking for.

This won't work fow what he wants to do. Any folders or individual files that have broken inheritance from the Document Library don't regain inheritance whe the Document Library does. Is there a way to do this recursively from the top down?