(A) A landlord may not demand or receive security deposit or prepaid rent or any combination thereof in an amount in excess of one and one-half (1 1/2) months’ rent; provided, however, that rent paid on the first day of the month or upon any other day mutually agreed upon by the parties, due and payable in advance for that month, shall not be construed herein as either security or prepaid rent and therefore shall not be included in the computation of the aforesaid one and one-half (1 1/2) months’ rent.


(B)  The landlord who receives security or prepaid rent from a tenant shall pay interest to the tenant computed from the date of deposit at a rate of four percent (4%) per year, and five percent (5%) per year after January 1, 1976, and within thirty (30) days after the end of each twelve (12) month rental period, pay to the tenant any such interest by cash or credit to be applied to rent due, except when the tenant is in default under the terms of the rental agreement.


(C)  Upon termination of the tenancy, property or money held by the landlord as security or prepaid rent may be applied to the payment of accrued rent and the amount of damages which the landlord has suffered by reason of the tenant’s noncompliance with Section 5–3–4-1 hereof, all as itemized by the landlord in a written notice delivered to the tenant together with the amount due twenty-one (21) days after tenant has vacated his unit.  Any security or prepaid rent not so applied , and any interest on such security due to the tenant, shall be paid to the tenant within twenty-one (21) days after tenant has vacated his unit.


(D)  If the landlord fails to comply with subsection (C) hereof, the tenant may recover the property and money due him together with damages in an amount equal to twice the amount wrongfully withheld and reasonable attorney’s fees.


(E)  This Section does not preclude the landlord or tenant from recovering other damages to which he may be entitled under this Chapter.