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answers:

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I am trying to save an SSIS package on a sql server running 2005. The issue I have is that I am using SQL Server Management Studio 2008 on my local machine to do this and it won't let me save the package in on the server because its not compatible with 2008. Is their some kind of compatibility option in management studio that I don't know about?

+1  A: 

The short answer is no: the 2005 and 2008 package formats are different, and 2008 packages can't be downgraded to 2005.

The best solution is probably just to install the 2005 tools alongside the 2008 ones and use them for designing your packages.

Pondlife
Never design in a newer version than the production machine can use. Amazing how few people seem to understand this.
HLGEM