| Well, in my opinion you are probably correct in being concerned about the Red Flag issue. But, clearly, you have a duty to your client/friend to deduct what may have been reasonable business expenses. If you think that the client has had a home office and you have confirmed the use is being used exclusively for business purposes, then go ahead and claim what the client believes are reasonable expenses.
The IRS will allow what it considers ordinary, necessary and reasonable expenses pertaining to the Home Office Expense. So, I would go ahead and deduct what seems reasonable and necessary expenses.
Good luck! | 
