I have a neighbor who proclaims and is reputed to be a martial arts practitioner. This individual has a habit of parking his commercial truck so that it protrudes into my driveway. Being fed up over this, I requested this individual to move his clunker out of my driveway. Immediately he advanced toward me in a nose-to-nose stare-down and muttered a threat that he would kill me. I calmly replied "that's good to know" then called him a "punk ass little bitch" saying "I'll bounce around you around like a rubber ball". This guy is a known 5150 and a convicted felon. I also told him "back off butt-head" while he spewed incoherent expletives. My question is: how close can a belligerent, hostile, known mental case approach you?
I answered a question that was similar to this before, which you might want to read:
That answer deals with an aggressor who attempts to stand face to face with you, violating your personal space but not actually throwing the first punch. A situation like that is best seen through the lens of psychology, and understanding the aggressor's psychology would help you determine what to do.
You didn't help yourself by saying what you said back to him. In general, I think the best response to this situation is to stand your ground and stare at him until he gets bored and leaves. Backing down or escalating things are choices that will tend to lead to a bad outcome, in my opinion.
When you call him names and egg him on, you're aggravating the situation. You're encouraging him to attack you. It's not a good strategy. It's especially bad since, as you apparently have learned somehow, he's a convicted felon, and the police consider him to be a crazy guy with a short fuse. Even if he's smaller than you, a guy like that could easily mess you up, especially since he knows where you live. Bad idea to taunt him. Now you'll need to watch out whenever you come home. It's not a good way to live.
You asked how close someone like that can approach you. First of all, legally you're probably in a grey area until you get a restraining order filed against him. Until then, the laws will vary.
I encourage you to file a police report whenever an aggressive individual threatens you even just verbally and/or violates your personal space. You want to have a record of everything for when things go really bad, and you and the other guy are taken into police custody after your neighbors call the police to come investigate a domestic disturbance.
You may not need a lawyer, by the way. Just head to the police station and ask to talk with someone about it. That's what they're there for.
The best thing to do legally is to have a restraining order filed against him. A judge will review your situation and will present options to you. Sometimes this involves just a general order for both of you to stay away from each other (by a specific distance or in more general terms). If you mention the part about him trespassing on your driveway, then that will also get made into the restraining order.
And whenever the restraining order is violated, you need to report it. It's up to the police and the courts to figure out whether the violation warrants an arrest.
Which brings me back to my advice: Don't say anything to him. Don't attempt to escalate the situation. You want to make this as easy as possible for the police and the courts. When you involve yourself as an actor in the fight between you two, the judge won't know who is the aggressor and who is the victim.
Also, if you can, get a witness. If you know your crazy neighbor is going to be there at a certain time when you're also there, and you know from past history that he's going to be threatening, then have a witness with you. And maybe have the witness record it on video for you as discreetly as possible. Even just knowing he's being recorded will likely set him off.
That's my advice. Hope that helps! And from now on, be mindful about your surroundings. Watch out for anything that doesn't seem right.