what does 'in transit' mean in the US ESPA form?
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Nope, transit generally means you're just in the airport - continuing on to another place, so you won't be at any address within the US.
That's why if you say yes, you don't need to give details of an address, because you're not leaving the airport, you're just 'on your way'.
You're actually visiting the US though, before visiting Canada, and as such, you'll have addresses there that you can and should complete.
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