Where exactly is Anytown, USA, you ask? Well, it's everywhere.
See, Max's whole world revolves around his school and his home, so we never find out where the story takes place beyond this little world. That could be frustrating, sure. But it also allows us to imagine the events going down wherever we want to picture them. Yep, this story could take place anywhere. And that anywhere includes where you're sitting right now. Helps you relate a little better, right?
Max isn't from Australia—how cool would that be, though?—but he does live in the down under. Also known as a basement. For Max, it's a safe place, unlike the rest of the world:
I like it in the down under, got the place all to myself and no fear of Gram sticking her head in the door and saying Maxwell dear, what are you doing. (2.1)
Staying in the down under means never shedding his status as an outcast. His grandparents have tried to make it as nice as possible, but heck, it's still a basement and he's still totally removed from the world—and even from his family.
But remember, Max imposes this isolation on himself. What is he hiding from?
Max's family lives in the "good" part of the town, but we know that there's another side of town to think about—the New Tenements. Most people call this place the New Testaments, which, as Grim tells Max, "has nothing to do with the bible" (11.1). Max isn't allowed to go to that neck of the woods, so what does he do? He goes. Duh.
The New Testaments are a major contrast to Max's safe space of the down under and the world his grandparents have tried to build for him. There, he is confronted with his parents' past through the characters of Iggy and Loretta. But his reaction to the place—feeling completely uncomfortable—confirms that he's nothing like his dad.