Is Gateway contribution required in this case?

[AKconsult]

Plan document states that profit sharing formula is cross -tested. However, in fact employer can't pass cross testing so employer is allocating contribution pro-rata compensation - not cross tested. Employer also allocates a safe harbor nonelective contribution. Typically, the gateway requirement would kick in. However, must I give the gateway in this case since the plan didn't actually use cross testing, even though the document shows cross-tested allocation? Thanks!

[Mike Preston]

I have never seen a document that "states that profit sharing formula is cross-tested". What does it actually say?

[Tom Poje]

ignoring everything else and simply focusing on the statement

"The plan allocated a contribution pro-rate baaed on compensation

I assume you mean everyone received the same % of pay.

the gateway rules are satisfied if all NHCEs receive 1/3 the rate of the HCEs, but since they received the same %, so even if you had to worry about the gateway rules you would have satisfied them.

is a formula actually stated in the document or does it simply say 'it is cross tested', which is (in my humble opinion poor language) if it is meant to imply 'everyone is in their own group, or something similar.