Fidelity split my NDx put credit spread across two tax years. Are they wrong?

I had a put credit spread on NDX, both legs opened 12/30/2025. NDX settled at \~25,249 that day, both strikes were ITM, both legs were automatically exercised.

Fidelity reported the long leg (gain of \~$50k) on my 2025 1099-B and pushed the short leg (loss of \~$54k) to my 2026 1099-B. Their explanation: the short leg's cash settlement hit on January 1, 2026 (T+1), so they recorded it in 2026.

The net spread was only a \~$3,900 loss (20-point wide spread, both legs fully ITM). But because of the split reporting, my 2025 Form 6781 Box 11 is inflated by \~$54k and I'd be paying tax on income that's immediately offset by a loss next year.

My position:Under IRC §1256(c)(1), gain/loss from a Section 1256 contract terminated "by exercise or being exercised" or "by lapse" is recognized in the year of termination — which is 12/31/2025 for both legs. The T+1 cash transfer on 1/1/2026 is an OCC clearing mechanic, not the termination event. The contract was dead on 12/31. I can also prove both legs terminated on the same date because they independently imply the identical NDX settlement value of 25,249.85 to the penny.

Fidelity's position: Settlement date controls, they won't correct the 1099.

My plan: File with the corrected Box 11 ($3,328 instead of $57,909), attach a Form 8275 disclosure citing §1256(c)(1), mail the return. In 2026, add back the $54k loss from the 2026 1099-B with a matching disclosure.

**Questions:**

1. Is my reading of §1256(c)(1) correct — termination date, not cash settlement date, controls?
2. Has anyone dealt with Fidelity (or any broker) making this same T+1 error on year-end expirations?
3. Any risk I'm missing by overriding the 1099 and filing with the 8275 disclosure?