To answer your question with regards to your modification process with ALS it is impossible to do without reading over their process, and having more information about your situation. As for getting your home refinanced, the questions that are relevant are more from a credit perspective.
1. Did you keep your mortgage payments current?
2. Who is your current lien holder
3. Is your credit score intact?
Now, back to the home as a tax deduction. One thing to consider is that if you are writing off unreimbursed business expenses such as a home office, then you have to make sure that when you apply for the loan that you disclose this to the loan officer. This is important because when the bank pulls a 4506 (transcript request from IRS), the adjusted gross income on your tax return will be reported back to the lender. The lender at that point will only be able to use that figure so make sure that let your LO know that this is part of the equation.