This is a follow-on post to “Apostrophe Abuse.”
English treats its and it’s differently than other words. For the word “it” and only the word “it,” ignore the rule about an apostrophe meaning possession. Its (without the apostrophe) indicates possession.
This means that the following is correct: Look at that dog. Its tail is wagging.
The wagging tail belongs to the dog and the second sentence could be rewritten to say “The dog’s tail is wagging.”
When we write it’s (with the apostrophe), we mean “it is” as it’s is a contraction (just like don’t, wasn’t, and I’m).
Using both forms correctly in the same sentence can look something like this: It’s clear that the dog likes playing with its tail.
The sentence could be rewritten as: It is clear that the dog likes playing with the tail belonging to it.
How do you know when to write its and when to write it’s? One way is to focus on whether you are showing that something belongs to something else (in the example sentences the tail belongs to the dog). Another way is to read the sentence by replacing its/it’s with “it is” in your head as you read it to yourself. If the sentence sounds correct when you read “it is” in your head, then “it’s” is the correct choice. If “it is” produces a nonsensical reading, then “its” is the correct choice.