Install a ¼ in. level starter strip under the first course of lap siding. Overlap courses at least 1 1/4 in.
Butt lap siding against vertical trim pieces at inside corners. Wood or PVC 2x2s can be used, but vinyl inside corner trim, similar in profile to a W valley flashing, is designed for use with fiber cement. The use of vinyl eliminates corrosion issues.
If possible, join lap siding over a stud. Stagger each butt joint at least a stud or two from the one below If a joint falls between studs, use an off-stud joiner plate.
Regardless of where joints fall, back them up with joint flashing splines. These can be made by cutting 6-in wide pieces of housewrap or aluminum coil-stock. If using coil-stock, bend the top edge 90-degree so it can hook over the top of the siding panel. This allows it to be installed without nails and to move with the panel.