I am two months in and already much better with tinnitus that has been very slowly fading in (it started as severe 8/10 tinnitus that covered everything 60 dB and below at 14 kHz, it's now at a mild, barely audible 1/10, 3 days ago it was still at a 4/10 moderate level), the severe onset (as in, I want to kill myself, I can't think, I can't read, I can't sleep... tinnitus) lasted for 23 days before it reached moderate levels, 20 of which I was utterly depressed and suicidal, the good news is, it does get better, albeit slowly, the ears take a long time to heal and provided you protect those, your tinnitus is likely to fade within 2 years.
Habituation itself is another process that takes in between 6 to 18 months and makes the noise less noticeable and less intrusive (it's still there but you don't care as much, if at all), this is a physiological process, and while it happens for most, it does not happen to everyone, because every brain is different, it is also blocked as long as you perceive the noise as a threat, (the noise is then processed by the amygdala which never fades in perception and keeps feeding a negative, stress induced feedback loop), once the noise is no longer perceived as a threat, it becomes an annoyance and is then processed through the nucleus accumbens, which does decrease (as in, physically decreases over time as it's receptors get over stimulated) and is what allows for habituation itself. I am not there yet, but considering my tinnitus is finally fading, it is likely to be gone or unnoticeable earlier than it would take for the effects of habituation to show up.
So, the good news is, it does get better, as long as you keep protecting your ears and you may be entirely tinnitus free in a few months.
The bad news is, this means you will probably have to deal with your tinnitus for the months to come as it gradually fades in, and you will need to remain over protective of your ears for at least 6 months (this means wearing ear protection anywhere where noise is louder than 70 dB), or risk a (potentially permanent) relapse, should you expose yourself to loud noises during that period, it also means you will need to keep being mindful of your ears for the rest of your life, even if your tinnitus is gone, your ears have been damaged and are more prone to further damages than someone else's with a healthy pair of ears, this means avoiding headphones (especially the first months), avoiding earbuds (for life), avoiding very loud activities (even with ear protections), for life.
I would also start to get a positive onset, negativity has never helped anyone, the least of all, yourself, sadly it took me 20 days to figure out that much for myself, though I'd like to think that's less than most. If I could change my state of mind from being suicidal to positive while undergoing 20 days of severe debilitating tinnitus, so can you. I won't lie, it's the hardest thing I've ever done and I did not know I had it in me, it takes a strong will, but little by little I started having more positive thoughts and getting my life back, the noise was still there, but I did everything to get my mind out of it, and not letting it control my life, 3 days later it started fading to moderate levels. Could I have kept going on like this had it stayed severe? I don't know and I certainly hope I never find out.
In my demise, I was somewhat lucky, I have experienced hell and got back from it, now that I know how bad it can get, I am never risking a relapse ever again, no matter how well my ears feel, I will never take that chance, because I've had a taste of hell and I know how it is.
Another advise is to lay off the meds, they won't bring you any good and only give you short term relief, especially the Xanax, but even melatonin can be dangerous if taken chronically, try to find sleep another way, such as meditation, bimodal neuro stimulation sounds, having a shower or a bath before sleep... The hard part for me wasn't falling asleep, I was so tired that eventually the noise didn't matter and I just passed out, the hard part was staying asleep as my tinnitus would spike and wake me up in between sleep phases.
Unfortunately I have no advise/remedy for that, other than attempting to get back to sleep the best you can, though that's something I couldn't achieve myself, so I usually just found something else to do to keep my mind off the noise, you also want to get to bed earlier so that you may experience slightly longer sleep before being awakened by the noise.
Eventually, a couple of weeks after my tinnitus got to moderate levels, I got to experience full nights again, which greatly improved my quality of life.
My advice is that time is on your side, so long as you take care of your ears and not take your earing for granted, something, I am sure you are well aware of now. Tinnitus can be a traumatizing experience, but that's something you can get through and learn lessons from.
Should it get better, and there is no reason to believe it won't, don't make the mistake of believing that once tinnitus fades you can get back to your old, care free life, a lot of people on this forum did and ended up regretting it, once it fades you can get to live your life again and in silence, as long as you keep being mindful that your ears are prone to damages and need care and protecting, this means you will need to do everything to avoid exposure to loud noises so long as you live, or risk relapse, that's the harsh reality of our condition and until an actual effective cure for hearing loss turns up, that's how it'll have to be.