Block with child terms of a term - how to

Draw me a picture (in words if need be, unless you have a site in progress that shows this). I just want to be sure I understand your request.

Are you using panels? What other modules?

This is a hand-made function that I put in my template.php (nothing to do with TF or any other module). This gets all the terms of the node and lists their children in a block if there are any. Parent terms are turned into h2 titles and children are listed under.

<?php
function child_tree_build() {

  if (arg(0) == 'node' && is_numeric(arg(1))) {
  
    $node = node_load(arg(1));
  
    if (count($node->taxonomy)) {

      foreach ($node->taxonomy as $term) {

        $tchild = taxonomy_get_children($term->tid, 2, $key = 'tid');
	
        if(count($tchild)>3) {
          $items = array();
          $subtree = taxonomy_get_tree(2, $term->tid, -1, 1);

          foreach($subtree as $children) {
            $items[] = l($children->name, "taxonomy/term/$children->tid");
          }

          print "<h2><span>". l($term->name, "taxonomy/term/$term->tid"). "</span></h2>"; 
          print theme('item_list', $items);
        }
      }
    }
  }
}
?>

Then I added a new block which contains:

<?php
print child_tree_build();
?>

You should use PHP-code input type for the block of course. This code does not check if terms are associated with a node or not, so empty terms are also listed.

I hope this might be inspiring.