Add-On Cost Button upon Checkout

Site URL: https://violet-marlin-xtyn.squarespace.com/config/commerce

Hi, I am looking to add a button or option to the checkout, where customers can add a gift bag for an extra cost to their cart. Please help!

There's a feature to offer follow-on products on product pages, but if you want to do this on the cart page, you'll need some custom code. Note that you won't be able to add this to the checkout page (mentioned in your question title).