If you tell her no, she might shoot you, then make it look like a fight.  The police might accept that, but it's still a crime.  

Lots of unanswered questions; but the intent seems pretty clear.... I'd refer her to another preparer...

Did she actively try to rent it - did she run ads in the paper, Facebook, on cartons of milk next to the pictures of missing kids?  If not and she wants to take the deduction, listen to what the other two posts say.

Why would you refer her to someone else? 

Are you going to sign your name to a return that reports a loss for which the client isn't entitled?

No reason to refer her to another preparer unless she demands that you show the loss.

I have had clients who showed a loss on a rental, but they were retirees whose tax was zero anyway without the loss.  It might be helpful to explain how little (if any) she "loses" in tax by doing it the correct way.  

Your statement "The last 5 years her old preparer had her take a loss without any income but advised the IRS might not accept that."  let me to believe that she was pushing the preparer to an improper (at best) filing....

You're correct, I wouldn't refer her to someone else... I just simply pass.

Your statement "The last 5 years her old preparer had her take a loss without any income but advised the IRS might not accept that"  led me to believe that might be the reason she was looking for a new preparer.  

Available to rent is the key as stated above. And proof as stated (ads, etc.).  but if the property didn't have an occupancy permit, problems.  I had one client, storm tore off the roof. Client said it was available to rent. Maybe if someone accepted a rental property with no roof, but an umbrella, but nah.

I believe that would be advertised as "Apartment for rent - airy with great moon views."

OK, what is everyone's go to: "I am sorry that I cannot take you on as a client" phrasing?

I'll go first:

"Sorry, but I value my license more than I value your pittance of a fee."

Your turns.

I have never used it, but I like the more direct approach that the founding father of the firm I started out with once used.  "Don't let the door hit you in the a$$ on the way out".  

Oh, you mean the DLTDHYITAOTWO response!