Actually, your description of your cut-off function, sounds like you have the 'late style' of model 1896 lever.

If you explore older threads on the KCA Forum, you will find discussions of  Krag magazine function problems and suggested things to look for and remedies.

Attached photo shows model 1892 cut-off lever and a late model 1896 cut-off.
The later cut-off lever function was changed, so that the lever is 'up', to feed cartridges from magazine.

Attached sketch shows function of an early model 1896 lever and how the cut-off shaft blocks cartridge-feed..

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