A blended payment is an amount made up partly of capital and partly of interest or some other type of income. You may not be able to easily identify the interest and capital parts. Treat as interest on a debt obligation the part that can be reasonably considered to be interest. Report this amount in the same way you would report any other interest.

We do not consider a payment to be a blended payment if:

• the interest or income element is definitely known
• the amount is received either as an annuity payment or in satisfaction of the recipient's rights under an annuity contract
• the payment is from certain obligations issued at a discount