As far as the question of Xanax being habit-forming, the answer is yes--all benzos are. But you can taper off of them. Edit: You CANNOT go cold turkey off of them. Or, at least, you really, really shouldn't.

I completely understand how you feel about meds. I have to be on them; I was diagnosed with depression at 14 and at this point they're calling it medication-resistant. It's that pervasive. It's either meds or ECT. (Which, incidentally, is a non-medication alternative to explore.) I opted to try one last-ditch effort with meds before going the ECT route. And I am choosing to be on as few meds at the lowest therapeutic dose possible--I started kind of high (i.e. while I was in-crisis in the hospital) and I've slowly been backing down to the lowest doses. Would you be willing to try something like that? I don't really know your situation, I just know mine. I've had waaaaaay too much experience with meds.