We demonstrate the capabilities of time-dependent density functional theory (TDDFT) for strong-field, short wavelength (soft X-ray) physics, as compared to a formalism based on rate equations. We find that TDDFT provides a very good description of th
e total and individual ionization yields for Ne and Ar atoms exposed to strong laser pulses. We assess the reliability of different adiabatic density functionals and conclude that an accurate description of long-range interactions by the exchange and correlation potential is crucial for obtaining the correct ionization yield over a wide range of intensities ($10^{13}$ -- $5 times 10^{15}$ W/cm$^2$). Our TDDFT calculations disentangle the contribution from each ionization channel based on the Kohn-Sham wavefunctions.
