My 8 year old, like yours, is in a 5th grade class for math. It is pretty apparent he is ready for pre-algebra and he already is pretty comfortable with basic algebra equations and word problems- his teachers have not expressed any concerns about him hitting algebra too early (although I think it would end up being a year behind your DS). Anyway, there is an 8 year old in our district currently doing Algebra and he is doing great. Like any developmental milestone some kids will get there before others - I do agree with Shari that is would be good to see where he is with the material - there are assessment devices that measure if a child is ready for the "concept" part of algebra I believe.

I think CTY or EPGY or something like that says that kids should generally not start algebra before age 10. But some kids are just ready.