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Every day I flag some posts... I've only recently started doing that, and I noticed that my flag number 1) resets every day, 2) increases by one for some reason.

My best guess would be that each time a moderator finds the question actually needing of moderator attention, all people that flagged it will get "rewarded" with trust, i.e., more flags.

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    \$\begingroup\$ I think just generally making good flags = you get to make more flags. There was a time I was earning no reputation, flagging a lot, and getting a higher flag limit. There is definitely a reward mechanism there. \$\endgroup\$ – doppelgreener Aug 17 '12 at 11:40
  • \$\begingroup\$ I sure I've read somewhere, but I'm not sure where (so if someone finds it they can make an official answer) That if you flag something correctly you get the flag you used back. \$\endgroup\$ – SpartanDonut Aug 17 '12 at 12:53
  • \$\begingroup\$ Probably, @ToddersLegrande, but I get more back. \$\endgroup\$ – jcora Aug 17 '12 at 16:05
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This answer (assuming its still accurate) describes how flag count works quite well.

https://meta.stackexchange.com/a/80117/183356

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