High-temperature DFT
First if all, I appreciate you and thank you for putting up such a good question.



One thing I will request you to note here is the definition of temperature. Temperature, in broad sense, is defined as the average kinetic energy (for equilibrium conditions, I hope you are speaking of that) of a system. The contribution mostly arises from translational kinetic energy, and the fluctuation in temperature is proportional to $\frac{1}{N-1}$. (I don't remember if it has some power or something.) In other words, a particle has infinite temperature fluctuation. So if you want to do finite temperature DFT calculations, you will need an ensemble of particles, and it will only add the cost.

In case you have infinite computational power (or at least enough to support no of molecules in the order of Avogadro number), you can, in principle, go for DFT at a finite temperature.



If you are worried about occupation of the higher states, you can calculate the higher states using Kohn-Sham Hamiltionian (these are just eigenfunctions of the Hamiltionian), and then calculate the occupation at a temperature using the formula for the concerned ensemble. Since the states of the KS hamiltionian are its eigenstates, these should not change if you have a static distribution of electrons. The eigenstates mean that these are decoupled by the same KS Hamiltonian, and in principle, you are not allowed to take an electon from one state to other without external purturbation that couples the states.



However, at a given temperature, everything is dynamic. This invokes that the states have finite lifetime, which from Uncertainty principle, imposes broadening in energy, i.e. it is not an eigenstate anymore. This imply there can be coupling between different states, and hence electrons can jump between states without external perturbation. You can externally add broadening to the states using broadning matrix, that mimics the temperature to some extent.



For TDDFT, you actually introduce an alternate electric field, and then this purturbation is used to calculate coupling between the concerned states. Thus, TDDFT calculates the excitation using light. It has nothing to do with the temperature.



Please let me know in comments if you have further doubts. 

Greetings from India. जय हिन्द. Jai Hind.