Indiana allows the deduction of all interest on US Govt obligations- on the IT-40- Schedule 2 line 4 but there is no place to enter that in Turbo tax or is there?

When you enter the 1099-INT on the federal return, be sure to check, "my form has more info than in just box 1". This will open up 12 new boxes, including one for "Savings bonds and treasury int(erest)".

Add your Treasury interest here (even if it duplicates box 1), because this will allow states like Indiana to treat this interest differently than the federal return.

You enter the info (identify the interest/dividends as being from US Govt securities) in the federal section, of TT,  and it automatically transfers to the state return.

That's why there is no place in the state interview to enter it.