Originally Posted by tzfujimino
It's time we left means in effect the time has come when we should leave, which is why you'll hear some speakers use the non-traditional form, D) 'should go'.
After a whole day of hard work I'm very tired. It's time [that] we _____ home.
A) go <see note below>
C) went traditional
D) should go colloquial
"It's time we go home"
<a plan to do something, a "real" condition for a future action.>
"It's time we went home"
<a regret that we haven't done something, more focus on the past non-action, and a wishful thought about the future action that may or may not take place—an "unreal" (or unsure) condition for a future action.>
See Grammar Logs for Sunday, December 9, 2001.