I would write some advice for questions to ask your lender, but you will be better served by doing some searches on refinancing and BRRR.Paying double the amount of principal in interest at that rate sounds about right.

To take advantage of the low interest rates you could do a streamline refinance to lock in a lower rate to lower your current mortgage payment on the outstanding principal you already owe and then get a low interest HELOC from a local bank or credit union at a lower interest rate than what you would be paying for the mortgage.

I don't want to pay taxes on my loan principal so I don't title the notes/dots in a business. 

This is a radical example (and I will come back to less radical examples in a minute) but an investor could sponsor a $5mm commercial real estate investment, have high net worth key principals in the deal, put no money down, collect the $1mm down payment from passive investors and take a 30% ownership interest (among other possible compensation...origination fee, management fee, disposition fee).  

Tax calculation considers interest and expense but not principal pay down.

The expenses seem too high and I believe principal and/or interest payments are included in your total expenses.  

Also my PITI does include Principal so you could back that out of the equation.  

The problem is what the IRA is invested in.The tax sheltering provided by an IRA allows you to accrue more capital over time, since taxes are not reducing the principal along the way.  

You have to be evaluating with all the information possible and the historical numbers for this rental are a must.My assumption is her expenses do not include the principal interest tax and insurance payment (PITI) that comes with a mortgage. 

First off, only the interest component of your payment is an expense; the reduction in principal is not (it's reflected in cash flows from financing activities in the cash flow statement).Your interest expense belongs "below the line" of NOI (net operating income), along w/ depreciation.On a side note, IMO you may be dangerously close to mixing personal and business activities, which makes it easier for others to pierce the corporate veil.