Here's a great site I found that explains it.
I've copied the information below... enjoy!
It's is a contraction for it is or it has.
Its is a possessive pronoun meaning, more or less, of it or belonging to it.
And there is absolutely, positively, no such word as its'.
A simple test
If you can replace it[']s in your sentence with it is or it has, then your word is it's; otherwise, your word is its.
Another test
Its is the neuter version of his and her. Try plugging her into your sentence where you think its belongs. If the sentence still works grammatically (if not logically) then your word is indeed its.
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