Its VS It's - which is which?

It's a problem. Or is it "its?" Which is the correct version to use?

"It's" is the contraction for "it is."

Examples: "It's cold outside." "I don't think it's worth the money."

"Its" shows ownership.

Examples: "The dog keeps scratching its neck." "Hold it by its handle."

"Its" is the exception to the apostrophe-s ownership rule. An easy way to remember this is the phrase, "the contract with contractions is that there must always be an apostrophe."

"It's" easy!