Another thing you can do, and it's something I do.
Whenever people say I'm a fag, or a nigger or wtfe, AGREE WITH THEM. These people are so simple minded that if you AGREE to everything they say you are/do, they eventually stop because it isn't funny anymore.
I remember this one time the guy went on with about 10 different things about what I am/do and I kept agreeing.
"Oh you're Canadian, you're a fag"
"That's right! I'm the biggest Canadian fag there is! I take it up the ass all the time!"
"I bet you do fag!"
"You have no idea, sometimes I take TWO things up the ass"
And repeat until they stop, and when they do stop, remind them of how stupid they are. :D