To adjust Schedule B for interest received after death in the TurboTax software, 

• Go to Wages & Income, then
• Choose the button "I'll choose what I work on."  There will be a button for "Interest and Dividends" 
• Choose Start or Update next to "Interest on 1099-INT."
• Answer Yes to "Did you receive any interest income?"
• Choose the radio button next to "I'll type it in myself" and select Continue
• Enter the bank name for the interest received, and the Box 1 - Interest Income Amount and select Continue.  This will bring up the screen "Tell us if any of these uncommon situations apply."  
• Check the box next to "We need to adjust the taxable amount." and Continue.
  
• Report your interest adjustment as a positive number to subtract on the next screen and select the radio button for "Other reasons."

Where does the adjustment for interest received after death show up on the Schedule B? We entered it, but don't see it anywhere.

The adjustment amount entered using the steps shown above will show up on the Schedule B in Part 1 - Interest Income.  It will be labeled as Other Adjustments with a negative interest amount reported.  

@billybob40