If you have just updated the Sage 50 program from an earlier version you should not have to restore from a backup file. Just open the data file and the program will update the database.

If the old version is prior to 2015 you will have to install the 2015 version first as the data files had significant changes at that time.

Unfortunately we could not open the company as usual. After updating and attempting to open the last company we worked on, we were notified, “This data has been updated to a new file format and is now incompatible with this version of the software." 

I read through Sage support that we could restore with the most recent backup, but the wizard won’t allow me to select the back up file, for some reason. The backup is a few months old (the company has been inactive) but I don’t think a few months should be so outdated that Sage can’t restore.

There is definitely a need to update the program when you get this message.

When opening from a backup there is no way that Sage can tell that the file is too old. What it is indicating is that the backup is from a newer version of Sage and cannot be opened with an older version.

What has not be indicate so far is what version of Sage 50 were you running? what version were you using when the backup was created? and last question for now, what version  have you just installed? This progression will help us determine future steps to try.

Sage 50 (Pro or Premium) 20xx.x for each of the three questions.