Will I lose my guitar or my children’s musical instruments when I file bankruptcy?

No.  (Unless they are really nice).

Let’s say that you own the musical instruments free and clear.  Utah law allows us to exempt (protect) up to $1,000 of their value.  (We can double this to $2,000 for a married couple).

Utah Code Title 78B Chapter 5 Section 506 states that:

78B-5-506. Value of exempt property — Exemption of implements, professional books, tools, and motor vehicles.
(1) An individual is entitled to exemption of the following property up to an aggregate value of items in each subsection of $1,000: …
(c) animals, books, and musical instruments, if reasonably held for the personal use of the individual or the individual’s dependents;

Now what if you are a professional musician, or at least have a garage band which generates a little extra income on weekends?  Then we can protect up to $5,000 of your guitar, amps, etc as tools of your trade.  garage band

The same code section above provides that

(2) An individual is entitled to an exemption, not exceeding $5,000 in aggregate value, of implements, professional books, or tools of the individual’s trade, including motor vehicles to which no other exemption has been applied, and that are actually used by the individual in the individual’s principal business, trade, or profession.

Now finally, let’s say that you have a $10,000 piano, but it’s financed with Summerhays Music.  Then we list it in the bankruptcy, and if you want to keep it, you check a box saying that you’ll reaffirm the debt and keep making payments at the same interest rate, balance, etc.  So long as there isn’t too much equity (as protected above), you can keep the piano.

If you still have musical instruments above and beyond the value of those exemptions above, then you will lose them or have to pay their value to the bankruptcy trustee so that he can distribute the money to your creditors.