remove the unit and mount the TV to the right of the Fireplace, at eye level when seated.

NO Shiplap! add a nice mantel (replace the tile if budget allows.

Thank you! Replace the tile with what?

I'm rearranging the couch by myself; my husband is not home. I feel like there's a lot of wasted space.

The section behind the couch in the photos is where we wanted to place our bar but now it feels crowded with this set up.

This is the original way I had it.
I understand why the TV would be better placed on the cabinet once the bookcase is removed, but my sofa looks weird
Please help

First off - very nice room! I'm wondering if the entire wall would benefit from a new built-in wall unit that includes cabinetry, shelving and a new surround for the fireplace.

It certainly would. I just don't know how to design it. We don't want to spend too much on this project, as we have a list of things to fix. We’re new homeowners.
The sofa is modular, so that's good news:)

looks great in the photo you posted... now put the TV pn the lower unit, DONE.

if it is a separate shelf piece, you could hang it somewhere else in your home?

whats the plan with the bar???

@Lyn Nielson
I finally updated it. Now what?

The TV is still too high.

eye level center of TV (about 41" off the floor) . Do you need a mantle above the fireplace?

a shorter, simple mantle for your modern space.

Add an area rug under the sectional.

do you NEED cabinets?

I need cabinets because we don't have a lot of storage. I'm thinking of painting them or the wall. Another idea is to switch out the handles and stain them the same color as the mantle.
We want to add a rug and advice on color?

I like the long mantle. The TV sits at 43”. We’re ok with that.

What about somthing like this?

That works but try it without the far left cabinet and with same length of open mantel on each side of the fireplace if that makes sense.

I thought the last mockup was by the OP.

Move the sofa back further from the TV.. Then maybe you squeeze in chair and ottoman at an angle to watch TV?

Here is my mockup, the burgundy cube is the ottoman even if no chair for it.

2 bronze medallions. A wood bench for the speaker. Art in three black frames, and coffee table books on the shelf. Black lamp shades less glare when watching TV.

Get a larger coffee table. Play with the scale of these pieces, this is just a mockup concept using decor.