Bogus emails

My hotmail account has been hacked. I receive bogus emails from many sources that seem similar to genuine contacts including hmrc. How can I stop these? I have also received an email sent from one of my contacts who is deceased which was very upsetting but more worrying as it was from his genuine email address so how do I know that any of my emails received are now genuine? I am also worried that my computer is now sending this virus to my contacts and infecting their computers. I have changed my password but should I just close this account and start again? i have scanned my computer with the latest Norton but it finds nothing. Please help