I think stopping the time outs wasn't helpful, because it's made her life at your home less consistent.

What supports does the school have to help support her? I think it is ridiculous that they are already considering kicking her out. There are lots of behaviour issues at the school I teach at - we have a LOT of children in foster care and a lot who are from very abusive homes. Our school spends a lot of time, where the child is removed from the classroom for a time and helped. But expelling them due to it? No, that won't help them at all.

Can you buy a special teddy bear and tell her it's her "Talk To Teddy" where she can tell and whisper all her feelings and thoughts to him? Sometimes that can help children calm themselves. You can suggest that the teacher use something similar in her classroom - for all the students to use. Our kindergarten class has one and it really helps the kids once they understand the concept.

Spanking is NOT the way to go! Especially not as a regular form of discipline and certainly not for a child who has been abused and traumatized.

Every time she gets into trouble, remind her that you love her and don't think that she is a bad person, but that she made a bad choice and did something that was wrong. Kids have a really hard time separating the two - when they get into trouble they think they are a bad person, and that reallllly just makes things worse.