Formula not working when criteria cell is populated with a formula

I have a simple logic statement that checks the time and if it is less than a set time it is to display a 1. If the time is greater then display a 2. It works great when I type the times out but when I populate the question cell with Now() formula it no longer works.
How do you get the logic test to look at the value of the cell and not return a "negative" when it sees a formula?