You're on Verizon so I'm guessing you are using Sn0wbreeze? The phone should be connected the whole time just iTunes should be closed until you need it. So here is the sequence
Connect phone, close iTunes
Open Sn0wbreeze create your ipsw
Follow instructions to put your phone into DFU mode
Then open iTunes it will say it found a device in recovery mode
hold down the Shift key and click restore
point to your ipsw you created with Sn0wbreeze let iTunes reload the phone