I normally setup a data access project, setup a business project that has a reference to the data access project, and a web project with references to both the data access and business project. With entity framework, all of the generated classes are in the data access layer. I normally use the repository pattern, which all of my repositories are in the business layer (could be in the data access layer too), and return the entity framework entities to the caller, which is an object in the presentation layer (an MVC controller, or an MVP presenter, or the code-behind of an asp.net web form, depending on what you are using).
HTH