Section 6049(b)(2), relating to information returns, tells us

(2)Exceptions
For purposes of subsection (a), the term “interest” does not include—
(A)interest on any obligation issued by a natural person,

Are there any practitioners here who are preparing 1099-INT forms for clients making payments on seller-financed mortgages?

IRS has been aware of the problem since 1991, when GAO issued a report ponting out that “Federal law does not give IRS the authority to require buyers to provide sellers’ SSNs, nor does IRS require buyers to send sellers a notice that IRS is aware of the interest payment made to them.”

https://www.gao.gov/assets/ggd-91-38.pdf

Maybe there has been legislation to change that. We all know how friendly Congress is to IRS requests for additional enforcement powers. You can try to find it. Or you can call their bluff.