Form 8881 and form 3800

I have a client who has an S corp and he owns 70% and his wife owns 30%. He created a pension plan for his wife and contributed $35k and had startup costs of $1000. His wife has a sole proprietorship and did not make any pension plan contributions. When I do form 8881 from the S corp side, I only get a $500 credit on the software. When I do it from the personal return side, I somehow get $8k? I'm not sure I fully understand how this works. I googled it and it says this situation will not get any credits. So I'm a bit confused. Anyone has any experience with this?