- It is allowed to own alts.
Yes, it is. Many reputable forum members have alternative accounts for different purposes. So as long as you are not using them for bad practices, you should be good. It's even better if you declare that you have an alt account so that everyone can see how you use the other account.
- How many alts will one own and it will become a farm?
The term "farming accounts" refers to the act of creating and growing multiple accounts preferably for the purpose of joining multiple signature or bounty campaigns to earn more money than you can earn while having just one account enrolled. So it doesn't refer to the amount but the act being done. You are farming accounts even if you have just one alt that you are growing with your main account and will get it enrolled in a signature campaign later when it's ready.
- Are farm accounts without merit sharing, cheating campaigns or contests allowed?
You mean alt accounts, right? Yes, you are allowed to have alt accounts if you are not farming them to cheat campaigns or contests making them have different identities and hiding from the community that it is you behind those alt.