We have done time-outs with Sophia, but pretty much when she's gotten so hysterical and out of control that she just needs to calm down. In fact, what I say to her is: "You can come back downstairs when you feel calmer."

One day she was so angry at me that before I said anything, she started stomping up the stairs and yelled: "I'm going upstairs until YOU calm down!"

Ah, but see, that's what I've always though a time out was--a time out or away from whatever situation it is that's frustrating or angering the child (or the parent, for that matter). So yesterday, when N hit Em, I scooped him up and told him that he was going into his room so that he could calm down and talk to his sister rather than hitting her. Kind of like an extreme form of redirection.

With Em, it's now morphed into a real "break" kind of thing rather than as a disciplinary action. When she's all frustrated or crying or whining or angry, I'll ask her if she needs some time to herself so that any continued discussion or interaction will be productive, and she'll often say something like "yeah, I need to get myself calmed down," and she'll go off into her room until she feels better.

I agree that timeouts can be overused, and used improperly. But I actually think it has a lot of utility. Or at least it has for my kids.