What should a preparer do if a client insists on unsupported vacation home losses?

The preparer should explain the law, request the records needed to support rental treatment, and document the client's response. If the facts do not support the loss, the preparer should decline to prepare that position.

If the client insists that the return include a known unsupported deduction, the preparer should not sign or submit that return. The professional boundary is not based on whether the IRS is likely to notice. It is based on whether the return position has support.