Schedule C has line 2 labeled "returns and allowances". Where in turbotax do I enter the value for that?

You would enter it on the income page. On TurboTax Online, then you must first enter some positive income for your business.  Then, when you revisit the income section of your Schedule C, you will see an entry labeled Rebates and refunds under the 'less common income' category where you can check the box and then enter the amount that was refunded.  Be sure to enter it as a positive number

Thank you, I found that.  I didn't realize this was a type of income.  I was looking for it under expenses.