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Like many of you, we have been waiting very impatiently for the upgrade to iOS 5. Between iCloud and the new notification system, it just seems like a really cool new thing with some awesome new stuff to keep my life even better organized.

So, like at least a few of you, we were dismayed when—after waiting all day and obsessively clicking the “check for new updates” button in iTunes—the new version arrived only to be unable to be installed because of a restoration error. Fortunately though, we found a solution.

For whatever it’s worth, the solution itself is very simple to execute, but be forewarned, you will end up having to completely rearrange all of your apps, resync all of your audio, video, and photos, and endure the headache that will inevitably come with that. That said, here is what you need to do to make iOS 5 happily install on your device:

1.) Sync and then disconnect your iphone without attempting to install iOS 5.

2.) In iTunes preferences (press cmnd+, to get to preferences while iTunes is open), go to ‘devices’ and select the iDevice you are wanting to install iOS 5 on. Now delete that backup file.

3) Take a manual Backup for the device.

3.) On your iDevice go to settings, then to general settings, and go down to the bottom to find the reset button. Click that and select ‘erase all content and settings’.

4.) Now reconnect your iPhone. Your computer should think it’s a new device: one you’ve never used before and as far as it cares, one it’s never seen before. Now try clicking the update button again in iTunes. It should work with no problems.

5) Now after updating to the latest release, restore your old settings by selecting Restore from Backup.

As we said, the downside of this is that you have to pretty much set up your iDevice all over again, but it seems like it should be worth it. Let us know whether or not this works for you. If it does, awesome. If it doesn’t I’ll do whatever I can to get to the bottom of the issue.