If the daughter is aware her mother is in jail, I'd ask if she would like to go see her mother, encourage them to write each other/talk on the phone, etc. If, for some reason, another reason for her mother's absence has been given, I'd go with that the best I could.

I think knowing one's mother is somewhere like jail, being able to see and experience what that is and how it works might be more helpful to the child than the mystery of some other explanation.