Get Posts Based on Child Taxonomies of Current Parent Taxonomy

I am currently listing products based on type and basically listing 4 top items per taxonomy. I have multiple taxonomies for each product in a hierarchical format and my current code displays all taxonomies and products when I only want it to display all child (not grandchildren) taxonomy products of the current parent taxonomy.

This is the current format:
Taxonomy Type
Product, Product, Product, Product

Taxonomy Type
Product, Product, Product, Product

Taxonomy Type
Product, Product, Product, Product

I want it to display like:

Parent Taxonomy Type

Child Taxonomy Type
Product, Product, Product, Product

Child Taxonomy Type
Product, Product, Product, Product

Child Taxonomy Type
Product, Product, Product, Product

HERE IS MY CODE THAT CURRENTLY DISPLAYS ALL TAXONOMYS WITH PRODUCTS>>>

[code moderated – please use the pastebin]