The Insert Text File into Clip item is available via the Insert and Extract Text button on the collection toolbar, except when the Recycle Bin tab is active.
Select the Insert Text File into Clip item to read the contents of a file, and insert those into the text of the active clip. If you want to create a new clip from a file, use the Create Clip from Text File button instead.
AceText can only read plain text files, such as text documents (.txt), HTML files (.html), XML data (.xml), software source code, etc. AceText cannot decode proprietary file formats, such as Microsoft Word documents (.doc), Excel spreadsheets (*.xls) or Acrobat PDF files (*.pdf). To transfer text from such files into AceText, open the file in its corresponding application, and then use copy and paste or drag and drop between that application and AceText. The software will then decode its own proprietary file format, and offer the contents as plain text to AceText.
See Editing Clips and Text to learn how to use AceText.