USA's debt is so high now that the taxable  income does not cover it.

I am assuming that the interest paid on rental property loan will be bring down by taxable income on rental.

Is that recorded and the finder fee is taxable?

I find that high.Taxable value $200,000.00RatioX0.06Total taxable$12,000.00Millage rateX0.5220Estimated tax for: 2018$6,264.0

If you want go gain access to the income generated from the property, you can take taxable distributions from the 401k or IRA. 

But selling an investment property doing a 1031 and buying an investment property and then later changing that investment property into your primary residence is perfectly fine and does not trigger a taxable event.The article you probably read was probably built around a safe harbor  for allowable personal use of an investment property for your intent to hold for investment (Rev Proc 2008-16). 

Consult a real estate lawyer to assist you.The IRS, eager to raise revenue, has decided that for a loan to be a loan, interest must be paid, and if interest is being paid, someone is making taxable income.That means that a loan will still be included in the value of your estate for inheritance tax purposes, should you die.In order to clarify that the loan is not a gift, the lender should write a memo establishing that you, the borrower, were solvent at the time of the loan.

Currently, my wife and I contribute the yearly maximum to our employer 401K plans to decrease our taxable income.

@Eric Long - the idea being to take a loss on cashflow every month to lower taxable income while banking on appreciation and the favorable tax treatment of long term capital gains when they sell? 

Then, from the net operating income (NOI collected rent - operating expenses), you get to deduct the interest (but not principal) and depreciation to get your taxable income.