re: Best way to handle multiple Xbox’s in the same house?

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can both accounts be online at the same time?

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Yes.

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Would each account need Xbox live? Also, can I use gamepass games on both Xboxes?

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If the account you are using has Xbox Live and/or Game Pass, then both Xboxes should have access to Xbox Live and/or Game Pass using the method I outlined earlier in this thread.

Your Xbox Live/Game Pass-enabled account can access Xbox Live/Game Pass from any machine you're logged into. Additionally, the "home" console for that account will always be able to access these features. This is why you make the secondary console the "home" console and just log in to the primary console.