My daughter is 20 years old, lives on her own, and has a full time job in the state of Indiana she hasn't lived at home for a year, my ex-wife is still collecting child support on her, and I have told her several times to get her taken off, I live a different state, and I've talked to a lawyer up there, and they said my wife has to sign a paper, but if she doesn't want to that is her option, until my daughter is 21. What can I do from a different state?

Eighteen years old with a full-time job, living on her own. Around here, we call that emancipated. I would start with the child support order, probably included within the decree of divorce. Read it carefully. Consult with a competent lawyer.

You should not have to pay, she should drop off almost automatically, What does your actual child support agreement says, most state if the child is over 18 and not in school child support is not payable.

So I don't see why anything needs to be done excpet you just start paying a lower amount

The divorce decree has no age, but I talk to a lawyer in Indiana and the county court house and they said child support law there is 21 years of age, unless the ex-wife will sign a paper, the money is taken directly out of my check weekly.

You will need a lawyer to review the law, not just the agreement. If the 'child' is emancipated, there will be no child support. I have never heard of a 21 year old child, but in Gawga, where I live, one must be 21 to buy beer, which is anti-American in my view.

I just talked to the ex-wife, and she said she has to through paperwork to get daughter emancipated, something longer in order for her collect more money, I wonder if my daughter can have it done?

There is no paper work to emancipate a 21 year old, they are automatically emancipated at 18, but still under child support if covered under your contract. Your ex is lying big time to you, file a motion in court to end your child support, make judge order it.

Check this: DivorceNet - Indiana Child Support FAQ's

George gave you a great link, but to shortcut things this is the relevant info:

What is emancipation of the child?
The child support continues until the child is 21, or when the child is emancipated by the Court. The Court can emancipate a child prior to the 21st birthday if he marries, joins the military, becomes self-supporting, or is over 18 and has not been enrolled in school for more than 4 months.

The key here is that this needs to be done by the court. So you have to file a petition in the court to have the judge rule. That means hiring an attorney in Indiana who can file the petititon for you.