Briefly, you must set your microphone to Mute on Playback and Selected on Record, to do this take the following two steps:
Step 1: Mute Microphone Balance on Playback
Double click on the little yellow "horn" icon on your task bar, up should come the Play Control window. If the Microphone Balance item is shown, make sure it is checked to Mute.
If the Microphone Balance control is not shown select Options and Properties from the Play Control window
In Properties, scroll down in the list of volume controls and make sure Microphone is checked on
Microphone is checked on, so its sound control will show.
Now return to the controls and Mute the Microphone Balance on Playback.
Step 2: Select Microphone Balance on Record
Select Recording on the Properties dialogue and then scroll down to the Microphone and check it ON too so that it is shown in the Record controls.
Select OK on Properties to save your settings.
When Properties disappears, you should be shown the Record Control, and the Microphone Balance should be visible, ensure the the Microphone Balance has the Select checked ON. 
You can now close the Record Control window and run TalkSpace. When you speak into your microphone, the level indicator (colored bars on the bottom right hand corenr of the TalkSpace window) should move up and down with the level of your voice. Remember that you have to press and hold the Ctrl (control) key on your keyboard for your microphone to pick up your voice.
Other issues to do with sound
The "speak to hear" rule
In some cases you will have to speak first in order to receive voice packets back and hear anyone else. If you cannot hear anyone talking in the TalkSpace Client, say something and that could start the stream back to you.
