This is the most common question on iTalki.
Let's discuss the difference between the two sentences
1. He is playing the guitar.
2. He plays the guitar.
The first uses a present participle ("p.p."), "playing", as an adjective to describe the subject of the sentence, "he". The verb is "is". As a p.p., "playing" can have an object ("guitar") but it cannot have a subject. To prove that "playing" is an adjective and not a verb, consider these sentences:
(a) Playing the guitar, Jack saw a cat.
(b) Jack, playing the guitar, saw a cat.
(c) Jack saw a cat playing the guitar.
In each sentence, the subject is "Jack" and the verb is "saw". Notice in the third sentence it is the cat, not Jack, who plays the guitar. As an adjective, "playing" clings to and describes the nearest noun. That is how ADJECTIVES behave. In the third sentence, "cat" is the closest noun, so the brilliant cat is the one described as "playing the guitar".
Sentence #2 uses an active verb "plays" whose subject is "he". Active verbs MUST have subjects, whereas participles never have one.
You can think of #1 as a photograph or a painting of a person playing a guitar. That's what p.p. adjectives do. They create images. That is the only thing you need to know about them. You can forget everything you have read in grammar books about them. Without context, they give no information about time frame.
Since a p.p. adjective acts like a photograph, it describes something that continues external to any time frame unless context provides one. #2, on the other hand, is an ACTION. It happens. It accomplishes. It is factual. That is the difference. Use participles as adjectives when you want your listener to imagine something happening. Use active verbs when you want to state facts.