This is a tough question to answer. You are an enrolled agent so you are trained to “know better”. That may be the real issue here. As you already know the ultimate responsibility is on the taxpayer. You should at the very least indicate in writing to the preparer and copy the client that you are unsure of the categorizations of the expenses in question and indicate that you have brought this to the attention of the taxpayer. The preparer should review the issues with the client. A more practical concern over the direct action the taxing agency may take, is the issue that may arise with the client if and when she gets audited; resulting in additional assessments and is looking for someone to blame. In short, it does not seem worth your exposure to liability from any source when compared to the amount of profit you can generate from the bookkeeping work.