Just got this last week and went to some trails with a lot of water. I didn't think was that deep but after a while the motor would start to bog down and not get power and stall out. Opened airbox and there was a pool in there almost up to the air filter and of course filter was wet. Took out all water and she would dry and then run well till next puddles and would get wet and dye out again. Is there supposed to be a drain on airbox. Is water coming in from lid or from somewhere else? Any help would be appreciated.

The drain's on the bottom of the air box. Water can be coming in from the gasket,air intake or even a split boot. You might want to clean the carb or at least drain it to remove any possible trapped water.Water's not good on cylinder walls and the piston. Can cause problems if it continues.I'd replace the filter also if you haven't done so. Dirt Cheap Yamaha, Honda, Arctic Cat & Polaris OEM Parts & Accessories – Cycle Parts Warehouse

Should the water be going out of the drain and not collecting there? I am new to ATV world and not really mechanically inclined. Is it normal for water to come in from air intake and what is a split boot? What should I be doing to keep it dry in future?

Just look at the air box link I gave you again!! It has a drain cap at the bottom to drain any accumulated oil/water.It's not normal for water to come in,BUT if you are running in water and it splashes up towards the tank, water can get in through the air box air intake tube. Or if you're deep in water it can come in through the lid gasket. Plus if the rubber boot itself has any splits,clamps loose,etc,water can come in.

Ok thanks for link!! New to site and thought it was forum advertisements so didn't notice/ click it, haha!

Would you recommend upgrading stock air filter to something else or using an outerwears prefilter?

You can run the stock filter and pre filter and it should be okay with regular cleaning and replacement. The only after market filter I'd ever put on a two stoke or a four stroke for that matter would be a foam filter such as an UNI. One that you can clean,oil and reuse over and over.Just like the two stroke dirt bikes all you see is a foam air cleaner and it's for good reason. It traps so much more of the fine dirt that can eat up pistons and cylinder walls. Others will say a K&N gauze type filter,but these are less forgiving imo if you don't keep em oiled and maintained properly. Plus I've seen enough damage from ones that weren't.