Comments can't be voted but we can put a note here that this is solved.
Regarding cost basis, if your child becomes a professional musician and gets self-employment income (is treated as an independent contractor, at least for some jobs, and files a schedule C) they can depreciate the instrument at that time. The basis for depreciation is either their cost basis, or the fair market value when placed in service, whichever is lower. The class life is 7 years, and this will reduce their taxable income for those years. Of course, if they sell later, they have a gain, but because of the economic concept of "present value of money" it is usually better to take the deduction now even if you have to pay it back later (paying the deduction back with future money costs less in the long run because of inflation.)
Here is a longer answer I wrote on the same subject
https://ttlc.intuit.com/questions/3409228-should-i-deduct-entire-amount-or-depreciate-musical-instru...
We also haven't discussed the fact that the Lifetime Learning credit is 20% of the first $10,000 of tuition. If your child pays more than that, you won't get anything even if you do list the instrument.
All in all, I think you will be better off not trying to take the instrument as an education expense; that will preserve your child's ability to depreciate it as a business expense if they turn pro.
