The difference between its and it's is as tiny as a single apostrophe, and yet the punctuation is fraught with so much meaning. The words are said the same way, they're pretty much spelled the same way and they appear in just about every book. But writers still get them mixed up all the time.
Apostrophes, No Rules Edition
There's a reason that its and it's are confusing, and one culprit is to blame: the apostrophe. Sure it looks benign, inviting even, but when it comes to its and it's the apostrophe breaks all of its own rules.
Oftentimes, the apostrophe shows up to give possession to something. If I buy a purse, that purse is Jade's. But apostrophes serve a different function in it's: they represent a missing i. And when it comes to possession in it? There's no apostrophe at all.
It's actually means it is or it has. It is a pretty common expression, but it is sounds a little formal in some narration and dialogue so many writers change it is and it has to it's. The apostrophe is there to represent the letters which aren't being spoken.
Looking at the word its is enough to make you fearful. It looks like the plural of it, and suggests that its are going to start leaping out at you from everywhere. But its is a word that's unique unto itself in that it breaks a grammar rule simply by existing. See, its is actually the possessive of an object's ownership. There's no apostrophe, and that's why its is so very dreadful.
Think of its as the neutral version of his and hers. It gives possession, ownership, to any object (or animal or person) that has no known gender. A few examples:
She balanced the pencil to stand on its own tip.
He brushed the leaves off its face to reveal the neglected watch.
Maybe the money wandered off on its own.
Knowing the Difference
It's not easy to tell when to use its and it's, so double-check them every time. Know what the sentence means, and read its and it's as it is and it has to see if they make sense. Remember that you're really using two words every time you put the apostrophe into it's, and just one word when no apostrophe is there.