service layer in MVC application

If you're using EF then that sort of abstraction is not really needed, but if you want it, then you create a DLL, do your EF mappings in there, and place all your model classes in there, too, as they will map to your DB. I think it's messy, but you can do it that way, and just provide all the code that changes the DB through EF inside that DLL.

Really, EF is doing that for you, it provides database access through strongly typed model classes and hides the DB layer from you.