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I work in St. Kitts and am on vacation in India. I plan to go back to St. Kitts with my wife and daughter. We have a C1 visa which is valid till November 2021. I will take Air India from Delhi to New York on 6th Jan, then on the same day the next flight from New York which arrives at 11:45 pm in Puerto Rico(SJU). My next flight depart the next day 7th jan 11:00am and is to St. Kitts. I have an 11h 15m layover in San Juan.

Can I go out and book a hotel room for one night? Or if the airport is open 27*7 can I stay in the airport?

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A C1 transit visa is for "immediate and continuous transit" through the US. From your itinerary it sounds like you qualify. It is normal for transit passengers to stay overnight when they arrive at night and leave the next morning. You are not staying longer than reasonable. You can stay in the airport or stay in a hotel room; both of those are reasonable for overnight transit. What you cannot do is use your transit status to do other things like visit friends or do sightseeing during your stay. Make sure you have enough time between your flights in New York because that is where you will go through immigration and customs.

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    "What you cannot do is use your transit status to do other things like visit friends or do sightseeing during your stay": does that mean that it's not allowed to have dinner with a friend in San Juan or to go into town and see some sights while waiting for the flight?
    – phoog
    Commented Dec 17, 2020 at 19:12
  • @phoog: That might be pushing it. I would think that if you meet friends in your hotel where you were going to stay anyway, or see the outside from your hotel, that might be okay, but I don't know where exactly the line is. 9 FAM 402.4-4(b) says "If the alien seeks layover privileges for purposes other than for transit through the United States, such as to visit friends or engage in sightseeing, the alien will have to qualify for the type of visa required for that purpose."
    – user102008
    Commented Dec 17, 2020 at 19:24
  • Hm. I think I've read something more permissive than that. I will try to find it online. You know, the maximum duration of a transit under a C-1 visa is 29 days. If the next flight to some small airport is really 2 days after your arrival (which is surely rare but not unheard of), I don't think there's any benefit to making you stay in your hotel.
    – phoog
    Commented Dec 17, 2020 at 19:29
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    I believe you are allowed to do sightseeing or visiting on a C1, provided transit is the primary purpose. So if you arrive one day and leave on the first reasonable flight after that you can sightsee while you wait. Your primary purpose is still transit, you are just doing other incidental stuff as well. If you delayed your departure in order to do more sightseeing then your primary purpose has changed and you would require a B visa. Also, to be practical about it, how are they going to know?
    – DJClayworth
    Commented Dec 17, 2020 at 22:42

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