If you don't know what you're doing, Merasmus is a tough nut to crack. He's got plenty of HP, wide range attacks, he hides as a prop at half and ~10% health and a short timeout. Where does he hide? What's the best way to deal damage to him while he's vulnerable?
Right now, the single best way to take Merasmus down is as a huntsman sniper. While the relatively measly 16 arrows will have you hunting for ammo quite quickly (nothing a dispenser can't fix, mind you), you can charge your headshots quickly and deal more than a thousand damage every two seconds from any safe range. You won't additionally be causing explosive splash damage on "enemy teammates" who don't know better and are too close to Merasmus.
As for prop hunting, here is a possibly inexaustive list of places to check: (overhead image taken from tf2portal.de)
After a few hours of watching Mesmarus fly away at 3% hp I figured I'd put together a short guide on a a very effective strategy to kill Mesmarus every time he spawns.