A common mistake, and one that drives teachers of all levels crazy, is the mix-up between the words "its" and "it's." While the difference may not seem significant to the average writer, using the words correctly can help you appear more intelligent and educated. Many people form first impressions simply by reading someone's writing, so you want your writing to be as accurate as possible.
"Its" is a possessive adjective — sometimes also considered a possessive pronoun — meaning "belonging to it." The confusion arises because if you don't substitute the pronoun "it" for the noun, an apostrophe is used. For example, the bone belonging to the dog is "the dog's bone." The eraser on the pencil is "the pencil's eraser." Both examples use an apostrophe plus an "s" in order to attribute ownership.
When "it" is used in place of the noun, however, an apostrophe is no longer used. Instead of "a rabbit's cage," you might say "its cage." Instead of "the house's window," you would say "its window." This tends to confuse people who are used to apostrophes denoting possessives. Other examples of the possessive "its" could include the dog burying its bone in its backyard and the table which has its leg broken off and its tablecloth in need of ironing.
"It's" is a contraction. A contraction is when a new word is formed from two or more separate words. In English, an apostrophe is used to acknowledge the missing letters. "Don't" is a contraction of "do not," and "shouldn't" is a contraction of "should not." "It's" is short for "it is," or less frequently, for "it has."
Any time "it's" includes an apostrophe, the writer should be able to substitute "it is" or "it has" and have the sentence still make sense. "It's going to be my birthday tomorrow," is correct because it can be changed to "It is going to be my birthday tomorrow." "It's been two hours since I've eaten," can be verified since changing it to "It has been two hours since I've eaten," is still correct.
Therefore, it's easy to get the two words mixed up, because English does not always follow its own rules!