What an adorable house!

Are you absolutely committed to a sofa? If you chose two armchairs instead your problem would be solved: TV above fireplace, two chairs facing it, table between the two chairs. And you wouldn't lose much seating since it's rare for three people to line up on a sofa. You might even have room for a small bench under the window.

Is it correct that if you put a sofa against the wall, it will not be centered in front of the fireplace? Are those screen-covered bookshelves or radiators flanking the fireplace?

It's tricky because of traffic flow, but you could try a loveseat or small sectional directly in front of the fireplace leaving a walkway behind it for people coming in the front door. They would have to maneuver a bit to get to the kitchen. Then the tv would go above the fireplace as Lindsey suggested. Otherwise, you could put reclining chairs on each side of the fireplace with an ottoman/coffee table in front of the fireplace and the tv on the large empty wall.

Strangely enough, I've never considered armchairs! I always thought a sofa is much more comfortable for lounging, but it's true that it's rare for three people to sit on a sofa.

Centering a sofa on the wall against the fireplace would block the stairs :( Small tiny house.

I appreciate the suggestions! I think the combination or arm chairs/recliners on each side of the fire place and TV on the opposite wall will work with the traffic flow.

Thank you!!!